The Property Council has welcomed Treasurer Jim Chalmers' announcement that the government is considering automatic FIRB approvals for established global investors with proven track records, a move that will unlock significant new investment in Australian property.
"Time kills deals, and right now we need as many investment partners as we can find for Australian companies to build the assets our growing cities need," said Property Council Chief Executive Mike Zorbas.
"Global institutional investors accounted for 29 per cent of all investment into Australian property in the last ten years and routinely support local businesses building the best new buildings and precincts across Australian cities.
"Streamlining approvals for established, low-risk investors will remove regulatory burdens that hold back global capital, which routinely has a better risk appetite for supporting domestic projects.
"In a time of systemic state debt, we need other people's money more than ever to build our offices, logistic hubs, shopping malls and much-needed new homes.
"The Property Council has consistently called for streamlining requirements for FIRB approval processes and application costs to encourage more investment into Australian cities."
The government will release a consultation paper today that will consider ways to unlock further global investment into Australia, including automatic approvals for non-controversial investors such as pension funds.
"However, while the Australian Government actively works to attract global investment, state governments continue to undermine those efforts. Victoria's punitive surcharges on international investors have resulted in a 53 per cent drop in institutional property investment in three years," Mr Zorbas said.
Yesterday, a new Mandala Partners report commissioned by the Property Council showed institutional investment into commercial and large-scale residential property developments has dropped significantly, with Victoria now attracting around 40 per cent less global investment per capita than NSW.
The report examines the impact land tax surcharges have on large investors, like American pension funds who invest in large-scale housing developments, not individuals from overseas who buy a family home.
The report revealed scrapping land tax surcharges on global investors nationwide could unlock $8.1 billion in investment, create 8,400 jobs and grow the country's GDP by $3.6 billion by 2030.
