Attracting international capital

Global investment makes up 29% of institutional investment in the property sector and has increased access to credit, boosted investment and supported Australian jobs

Australia has historically relied on international investment to bridge the gap between domestic savings and capital requirements, with international investors providing 29% of institutional property investment over the past decade, approximately $1 in every $3. This capital has been essential for building cities, funding infrastructure, and supporting employment across the country.

The United States dominates as the source of this investment, providing over 60% of global institutional capital flowing into Australian property. This investment has traditionally centred on New South Wales (50% of all foreign investment) and office assets (45%), though it spans all property types from industrial facilities to student accommodation.

Taxes imposed on global institutional investors in Victoria and Queensland are deterring investment

Victoria and Queensland have introduced additional taxes specifically targeting global institutional investors that go beyond what other states impose. The consequences are stark. Victoria has experienced a 53% decline in global institutional investment since 2022, falling from $10 billion to $5 billion. Queensland shows no growth despite strong economic tailwinds. Both states now receive 40% less foreign investment per capita than New South Wales. The report documents real casualties: a 201-bed student accommodation project in Melbourne indefinitely postponed, industrial investors exiting Victoria entirely, and millions redirected to overseas markets.

Removing taxes on global institutional investors will unlock $8.1B in investment, add $3.6B to GDP and support 8,400 Australian jobs

Economic modelling reveals that removing these surcharges would generate substantial returns:

• $8.1 billion in additional investment from 2026 to 2030
• $3.6 billion added to GDP nationally
• 8,400 jobs supported across the economy

The benefits far outweigh the costs. Victoria could see up to $10 in gross state product for every $1 of foregone tax revenue, with the state capturing $5.7 billion in investment and supporting 5,900 jobs. Queensland would gain $1 billion in investment and 1,000 jobs. To put this in perspective, the economic impact equals 6.2 times the annual contribution of the Australian Open to Victoria and would support 1.4 times the jobs created by the West Gate Tunnel Project.

Read and download the full report here.