· In 2016, the average site area purchased was 21,045 square metres – increasing more than 18 times from 2012
· In 2016, Australian development sites purchased by Chinese developers and investors averaged a potential 502 dwellings per development site – 13% up from one year ago
8 February 2017, Malaysia – Knight Frank’s latest report, The Rise of Chinese Developers in Australia – Market Insight: January 2017, found that Chinese developers and investors purchased a total US$1.8 billion (AU$2.4 billion) worth of disclosed Australian residential development sites in 2016, amounting 38% of total sales. This is up by 12% in comparison with 2015, and up by 36% from 2012.
As Chinese developers gain confidence in the Australia market, diversify and move towards lower density developments, the sites transacted have increased significantly in average size – at least more than 18 times since 2012, to average 21,045 sq m in 2016.
The report also found the average development site purchased by Chinese developers and investors could yield 502 potential dwellings, a 13% rise from 444 potential dwellings from 2015 sales.
Nicholas Holt, Head of Research for Knight Frank Asia-Pacific, says, “China has very much led the globalisation of development activity over the last five years, with Australia, along with the US and the UK, the major target markets. Growth opportunities, diversification and brand building have been key push-factors encouraging this wave of outbound capital, with a significant number of top-tier developers now active overseas.
“Going forward, the increasingly stringent capital controls enforced by the Chinese authorities could put a brake on some activity, although given Australia’s solid fundamentals, we expect the major state capitals to continue to be targeted over the coming years.”
Michelle Ciesielski, Head of Residential Research for Australia, “Long-term strategies must now be devised to allow for the Chinese government tightening the ease of outbound capital flow, and local lenders limiting funding to control their liquidity and satisfy Australian Prudential Regulation Authority requirements. But one thing is clear – Chinese developers are determined to succeed in Australia, and, for many generations to come.
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Notes to Editors
Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank has more than 13,000 people operating from over 400 offices across 59 countries. These figures include Newmark Grubb Knight Frank in the Americas, and Douglas Elliman Fine Homes in the USA. The Group advises clients ranging from individual owners and buyers to major developers, investors and corporate tenants. For further information about the Company, please visit www.knightfrank.com.
Knight Frank has a strong presence in Malaysia with its headquarters in Kuala Lumpur as well as branches in Penang, Johor and Kota Kinabalu. The company offers high-quality professional advice and solutions across a comprehensive portfolio of property services and is registered with the Board of Valuers, Appraisers and Estate Agents. The Company is licensed to undertake property, valuations / consultancy, estate agency and property management and is also on the panel of all leading banks and financial institutions. For further information about the Company, please visit www.knightfrank.com.my.