New research from Colliers has found that offshore investment from the US into Australia has increased by 58% in the 12-month period to June 2024, compared to the same period in 2023 (from USD $1.10 billion, or AUD $1.6 billion, to USD $1.74 billion, or AUD $2.55 billion). 

The majority (38%) of US investment went into the industrial sector, with strong investment also into the land lease community (20%) and residential (19%) segments of the market. 

Additionally, in positive signs for the recover of transaction volumes, H1 2024 saw total offshore investment across all asset classes totaled USD $3.076 billion (AUD $4.52 billion), up by USD $726 million (AUD $1.07 billion) when compared to H1 2023, totaling a 31% increase overall. The majority of this has come from an uptick in offshore investment in office space, which represents 42% of Australia’s total offshore capital.

Colliers’ Global Capital Flows Report | H1 2024 also highlights that the wider Asia Pacific region was home to four of the top 10 global cross-border capital sources in the first half of 2024 – Singapore, Hong Kong, Japan and China. 

When it came to global capital targeting standing assets, Japan and China were in the top five destinations globally, with Australia also representing the APAC region within the top 10, according to the Report.

“Improving fundamentals are set to create new investment opportunities in the months ahead, with global rate cuts signaling positivity for real estate markets,” Chris Pilgrim, Colliers’ Managing Director of Global Capital Markets, Asia Pacific, said. “While 2024’s market gains will be moderate, 2025 will see a much greater spread to yields emerge, opening up more of the market to buyers and vendors as valuations adjust.

“Most major global economies have put the idea of recession behind them, with GDP rates improving year-on-year. Importantly, GDP growth forecasts for developed economies show a general improvement in 2025 and again in 2026, no doubt supported by subsequent rate cuts. For major developing economies such as China and India, the growth picture remains very robust, but points to a gradual normalisation of GDP growth rates over the same period.

“For global investors, the Asia Pacific region offers strong economic growth, attractive returns compared to more developed regions and an opportunity to diversify their investment portfolios within the region’s dynamic, varied and emerging markets.

“APAC is a powerhouse of economic activity, offering diverse investment opportunities across traditional sectors such as residential, commercial and industrial and logistics as well as growing specialized sectors like data centers and cold storage.”