Published: November 05, 2018

More than $735 million in office sales were made in Adelaide over the past year, Savills Australia says, with strong interest from local and foreign investors.

The total, which accounts for all transactions worth more than $5 million, was down on last year’s sales, which reached $819 million.

However, Savills said the market was still healthy in Adelaide.

Associate director for capital strategy and research, Shrabastee Mallik, said the company’s latest Adelaide Office Briefing showed a pick up in economic activity was drawing domestic and foreign investors to the market.

“Business confidence in South Australia was the highest in Australia of all states nationally in September … according to the Roy Morgan Business Confidence index,” Ms Mallik said.

“This clearly illustrates to us that Adelaide’s office markets are going to continue to grow in terms of attractiveness throughout the next two to three years.”

Labour market statistics were also strong, with a 1.3 per cent employment growth in the year to September.

“Professional job advertisements grew by 14.0 per cent in the same annual period, pointing to ongoing strength in Adelaide’s office markets,” Ms Mallik said.

“We are also going to see significant positive flow-on effects to the South Australian economy, with ongoing Federal Government spending on the new shipbuilding program expected to create thousands of direct and indirect jobs.”

Peter Isaksson, a capital transactions director for Savills, said investors were noting the potential of Adelaide offices, as SA was the only state with no stamp duty on commercial property sales.

“We are seeing more and more evidence ... of a notable increase in inquiries from foreign investors, as they look for yield outside of the east coast office markets,” Mr Isaksson said.

“Savvy Singaporean investors have been particularly active, as they look to diversify beyond the east coast.”

Article by Michelle Etheridge, originally appeared in The Advertiser, 5 November 2018