The effects of the international credit crisis have well and truly hit home, with the recent battering of Australian Real Estate Investment Trust’s (A-REITs) and the downturn of many direct property assets.
With this misfortune comes opportunity for the cashed up investor to take advantage of distressed assets and short-term market turbulence.
Property Fund Manager Vaughan Hayne of WHK Horwath Securities Limited (WHKSL) and his team have been liaising with industry professionals to gain a feel for opportunities in the property market.
Mr Hayne believes the cycle has returned to an environment where investors are seeking transparent, plain vanilla products, with low gearing and a focus on yield.
“In times of market crisis, the philosophy “Cash is King” is evident through A-REITs raising capital to both strengthen the balance sheet and allow for strategic acquisition opportunities," said Mr Hayne.
“Capitalisation rates softening across all property asset classes has created opportunities for cashed-up buyers to acquire quality assets which would seldom reach the market, and are now selling at bargain prices," said Mr Hayne.
Mr Hayne claimed the positive feedback retrieved from industry participants, combined with the decline in interest rates has provided an opportunity for his organisation to launch new products in 2009.
“Our new products will take property investing back to basics where the investor clearly knows the underlying asset(s) and attributable income component," said Mr Hayne.
“Stringent risk management policies will be adhered to with an investment committee appointed to approve decisions," Mr Hayne said.
In times of market turmoil, a wise investor who can identify sound undervalued investment opportunities can create a strong investment portfolio for the medium to long term.
“This will be a big step for WHKSL in this current environment, however the support of investors will ultimately determine the success of these products," said Mr Hayne.
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