The Property Council’s all property index, run by IPD, showed a total return of 12.4% for the June year, from an 8% income return & 4.1% capital growth.
The total return for the year to December was 8.8% (8.1% income, 0.6% capital growth), and 9.2% for the year to last June.
IPD’s executive director for Australia & New Zealand, Anthony de Francesco, said a 2.3% increase in capital return lifted the total return for cbd offices to 14.7% and raised the return across the whole office sector by 1.2%.
Dr de Francesco said listed property entities outperformed other asset classes over the June year, achieving an annualised return of 15.9%. Equities were the closest competitor at 14.7%. Over the last 5 years, direct property returned 5.7%, listed property 8%, bonds 9.5%, equities -0.2%.
He said the latest results showed the commercial property market was continuing its post-global financial crisis recovery: “The ongoing improvement in returns for New Zealand property investment is consistent with strengthening macroeconomic fundamentals such as employment demand & retail trade. The index results suggest property investment returns should continue to rise above the long-run average return throughout the remainder of 2013 and into 2014.”
IPD has $12.1 billion of assets owned by 26 funds in its index database.
Attribution: Property Council release.