Asian investors are increasingly being attracted to Australia because of the potential favourable returns on offer.
CBRE's Asia-Pacific head of research Dr Henry Chin explained offshore investors are keen to look at alternative markets to the US and Japan.
He explained the average office yields in Sydney are at 6.7 per cent, while returns in Melbourne are 6.1 per cent - more favourable than other Asia Pacific markets.
Investors have also been attracted by the recent fall in interest rates, the weakening of the Australian dollar and the potential rental growth expectations.
CBRE city sales director Mark Wizel added more than $3.1 billion has been invested in the central area of Melbourne over the past two years - largely coming from Asian-based investors.
"While the pioneers have been the privates, this is giving confidence to the institutional investors to follow suit and attention is shifting to core and value-add assets," Mr Wizel said.
Posted by Steve Douglas