The housing market has been rocked by a series of negative developments, including a drop in property values and rising rents.
Key points: The BHP’s new investment in Perth is expected to make it a top 10 property investment in Australia by 2019The Perth-based company’s Perth office was sold to Chinese investors in OctoberThe Australian Federal Government is trying to rein in property speculationThe property market has already seen two major property market downturns, which led to massive house price falls and a housing bubble.
The BHP Property Group, which owns Perth’s Pangea Road and the Perth International Airport, has recently been expanding its Perth office.
Pangea has been a favourite of foreign investors, particularly Chinese, who are attracted to the high-end property market.
The property company is now planning to open a new office in Perth, bringing it into the top 10 properties in Australia, according to property market researcher Domain Capital.BHP’s Perth-listed property portfolio is valued at more than $US10 billion ($10.7 billion) and has an average annual turnover of more than US$1.3 billion.BHP is investing in new property projects, particularly at its Perth headquarters.
Pangaea has seen a drop of more then 50 per cent in its value, with the Perth office being sold to a Chinese investor in October.BHB said it was “confident” that Pangeas office would remain in Perth.
“Our Perth office will remain in the Perth market as we continue to grow the company and strengthen our operations and the community,” the company said in a statement.
“The office is part of our strategy to build the business and grow the business in Perth and we continue our drive to become a top property investment destination in Australia.”
The Perth office is owned by the Pangean Group and was purchased from the BHPs predecessor, the Pangaea Group, for about US$3.8 million in November.
The Pangeans Perth office opened in 2011 and was later sold to the Chinese company, with a $US1.7 million price tag.
The Perth offices office was purchased by Chinese investors from the PANGAAN group.PANGAIA was bought for about $US5.4 million in December and sold to China’s Beijing Investment Corporation, which is an investment company owned by state-owned China Construction Bank.
In November, the Perth-owned Pangeaa office was also sold to private equity firm the Pango Group, with its value increasing to $US7.4 billion.
The move comes as the Australian Federal Governments (AFL) is attempting to rein up property speculation and curb speculation on the countrys housing market.
In the wake of the BHB announcement, the Federal Government announced it would be putting more pressure on property developers to hold down house prices, as well as on foreign investors and foreign buyers, by banning foreign investment in new properties.
But the Government has been criticised for not doing more to stop speculation.
“It is important that we continue the dialogue with property developers, especially foreign buyers who may be interested in purchasing new properties in Perth,” Prime Minister Scott Morrison said.
“We also need to maintain a focus on keeping the housing market in Perth as a sustainable asset.”
The Federal Government has also announced it will be bringing in stricter laws on foreign investment, and will allow more local governments to buy land.
Topics:housing-industry,housing-market,business-economics-and-finance,property-industries,prince-abbott-2154,bhp-2135,perth-6000,boulder-3030,wattleup-3820,wimmerup-3380,warwickshire-4870,barnell-3328,pembroke-4740,southern-australiaContact Ashley McBrideMore stories from Western Australia