October 7, 2014
Sentinel’s purchase of strategically located retail properties, such as our latest property Menai Central, has been undertaken with the expectation that a housing recovery will see these properties re-rated in the future.
This opportunistic approach is now being vindicated with several leading Australian economic forecasters, including BIS Shrapnel, now confidentially forecasting the start of a new boom in residential housing construction.
Off a low base of under-building in recent years, we are now looking at a significant jump in the construction of new residential housing in coming years.
This renewed residential construction activity will be a major driver of domestic economic growth, with the retail sector to be one of the major beneficiaries.
The Australian economy is also set to benefit enormously from the recent election of a new Federal Coalition Government, which has already declared that “Australia is under new management and open for business again”.
A return to stability at the Federal Government level is widely expected to deliver a surge in new investment and business activity and overall confidence. This fresh post-election domestic boom is supported by strong future GDP growth forecasts as people realise our resources boom is far from over and still has a long way left to run.
These very positive fundamentals for the Australian economy provide a solid platform for continued rental growth and return on investment across the Sentinel property portfolio.