Investors turning to commercial property

ING Direct believes that low-interest rates, soaring house prices and tighter residential investor lending conditions have created a strong appetite for commercial property.

“With investors increasingly turning to commercial property, there will likely be a complementary surge in demand for professional support to help navigate the market and negotiate on commercial loans,” Mark Woolnough, ING Direct’s head of third-party distribution explained to Smart Property Investment's sister publication, The Adviser.

“In the past 12 months our commercial business has grown strongly through supporting residential brokers who have been actively looking for opportunities to diversify,” Mr Woolnough said.

Leading the team, as national partnership manager, is John Kolyvas.

“Commercial property is becoming increasingly attractive to private investors, particularly simple-term lending, and anecdotally we know that these investors rely on their advisers, be they brokers or accountants, to help them navigate the commercial market,” Mr Kolyvas said.

The decision by ING Direct follows a year in which the Australian Prudential Regulatory Authority initiated tightened lending standards for residential property, prompting many lenders to increase interest rates for residential property investors or raise LVR requirements.

APRA's directives did not apply to commercial real estate investment. 

Investment in Australia commercial property reached a new record in the last financial year, with overall investment in retail, industrial and office sectors increasing by 19 per cent to $28.88 billion, according to Colliers International.

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