Upswing comes to the party It's the first week since the Coalition parties were elected into power and it seems the party in property may just be starting. In the past seven days there has been more talk of sales, either listed or tenders being prepared, and initial public offerings than at any time in the past year. While it's not the opening of the floodgates, there is a spring in the collective step of the commercial real estate market. Leasing remains tough and the most recent employment figures for August were sobering for any government. But if all the speculation of deals comes to pass, then the direct property and real estate investment trust (REIT) sectors will be happy. The trigger, aside from the change of government, is anticipation of the abolition of various taxes and the knock-on effect. Abolishing the carbon tax and mining and resource rent tax would reignite the mining sector, so the theory goes, leading to higher demand for workers in offices. Of course, any change of government, particularly to the Coalition, also means paring back the number of public servants, so the next few months will be a roller coaster for office landlords. But as the dust settles and super funds look for higher returns than the 2.5 per cent cash rate, large deals are expected to hit the headlines. Of those talked about is the possible sale of the NSW Police headquarters at Parramatta, for about $240 million. CBRE says that in capital markets there had been a strong start to investment activity in the Sydney CBD for the new financial year, with 16 deals worth about $862.2 million. Of course, foreign investors still drive much of the activity, according to CBRE's latest Office MarketView report, with solid investor interest in the higher quality assets. Sales included 400 Kent Street, sold by Charter Hall to Credit Suisse for just more than $58 million and 130 Elizabeth Street from GE to Blackstone for about $50 million. Australian and offshore-based investors are the purported combination of buyers of the $175 million Sydney Water Board site, also at Parramatta. The yields have also reflected the improving conditions, particularly for assets in good locations and with strong covenants. Yields have tightened from 7.5 per cent to 7.3 per cent in the prime office market. Secondary yields remained relatively flat over the first half of the year at 8.7 per cent. As the spread between prime and secondary yields increased, the perceived risk associated with non-core direct real estate also rises. But let's not forget that as markets improve, potential new floats are never far away. First to be touted is a $200 million offering by Fife Capital, owned by former Grant Samuel director Allan Fife. The assets are likely to include some office and industrial, with the funds raised being used to help with the planned 383 George Street residential and retail project. Businessmen Geoff Dixon and John Singleton, together with Mark Carnegie, have started the preliminaries for a float of the Australian Pub Fund, with the Riversdale Group's portfolio of pubs. All the market needs is for the starter whistle to blow.