Aussie Commercial Property Upcycle May Look Different This Time -- Market Talk

Dow Jones10-21

2326 GMT [Dow Jones]--Upcoming revaluations of Australian commercial property will be positive but less exuberant than previous cycles, reckons Morgan Stanley. It analyzed cap rate spreads versus the 3-year swap curve over the past 20 years for major real-estate sectors. This informed how cap rates could compress from here. "We think upward asset revaluation in the medium term will be driven by 50/50 cap rate compression/rent growth," said analyst Simon Chan. That would be a different outcome to the 61/39 split in the 2012-22 property upcycle, MS says. It's hard to foresee that cap rates would compress by as much as 230 bps, which reits experienced across 2012-22, the bank adds. (david.winning@wsj.com)

(END) Dow Jones Newswires

October 20, 2025 19:33 ET (23:33 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.

At the request of the copyright holder, you need to log in to view this content

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment