Australia real estate market insight Q2 2019: success relies on strong asset management
The success of key national healthcare programs will rely on better asset management and visibility of construction supply chain.
Rising inflation puts pressure on asset owners
Our real estate market insight report for Q2 points to rising inflation in construction costs as major infrastructure and real estate projects come online, placing pressure on asset owners to stay on budget. Cost escalation in construction is reported to rise to 5 percent in Victoria in 2019 and 3.5 percent in New South Wales.
Infrastructure projects drive cost escalation
Major transport infrastructure projects key drivers behind cost escalation in the current market, with the likes of Sydney Metro, the Cross River Rail project in Queensland and the Gold Coat airport terminal expansion putting pressure on the availability of skilled labour and resources.
Asset management vital for healthcare project success
Infrastructure investment has a bearing in healthcare spend, which will rely on the same construction resources. Within the next four years, federal and state governments are embarking on a huge capital expenditure program for health including $1.3 billion from the federal government on health infrastructure and community health programs.
Ensuring value for money for the billions of dollars that will be outlaid on these projects, will rely on good asset management.