Invesco chief Mick O’Brien would invest his money in Chinese office buildings if he suddenly had $400 million to invest, attendees to a Breakfast with the CEOs presentation heard yesterday.
ING investment manager Grant Bailey said he’d take a punt on Middle East office buildings. “There are more cranes in Dubai than Shanghai,” he said. Bailey said he would also endeavour to buy bad stocks in Australia and hope that a private equity buyer would buy them out.
nabCapital’s chief John Hooper said he would invest in Australian coastal property and infrastructure.
Seven CEOs were included in the panel which discussed the outlook for 2007. The consensus was that there was no reason to expect something terrible would happen, but returns were not likely to be as high as previous years. O’Brien said that a worrying trend was that private equity players were buying at twice the price they could have paid a couple of years ago.
“The Australian market is not going to enjoy the same returns in the next couple of years and investors need to look at the other alternatives of achieving alpha, minimising tax and other strategies,” O’ Brien said.
According to NSW Treasury Corporation CEO Stephen Knight we’re in the middle of boom times. “There is so much liquidity everywhere you look,” he said. “Cycles do occur and while I don’t want to be all doom and gloom, liquidity may dry up.”
Massive shifts into domestic equities will not change dramatically, according to Challenger chief executive Rob Adams. “There may be a much broader opening up of alternative investments. Institutions may change definitions of alternatives and may make contributions to private equity,” he said.
“One thing we are seeing from sophisticated investor is significant allocations to direct property portfolios.”
