Australia's economic growth lays far beyond capitals

While Australia is often viewed as a collective economy, an expert said each city and state can possess a wide range of different opportunities and characteristics for future growth.

Speaking to Financial Standard, Wingate Group co-head of private wealth Joel Rosen explained the current dynamics between different locations across the nation. Although Sydney and Melbourne continue as powerhouses for entrepreneurship and investments, other states are slowly catching up.

He added it is very rare to have several cities or states across a country that have "so much embedded wealth".

"... how we view Australia as a country compared to these cities, is that people have realised each city has their own unique story and they're booming for very different reasons. It's unique that none of them are similar to the other, which is quite interesting," he said.

"If we use the example like Perth, which is a huge resource-driven economy, you'd be observing a host of economic activity based on a very resource-driven space. Whereas, moving to the likes of Sydney, not only have you seen a real estate boom, but you're also seeing the AI explosion and a tech entrepreneur boom."

Rosen said closing the gap will require more collaboration between local governments and the private sector across other states and territories, as well as increasing investment appeal for lesser-known locations.

"Internationally, the best outcomes have been achieved through public-private partnerships - it's got to be a joint initiative," Rosen said.

"When big industry players couple with local and state governments, and market the country as a safe haven, all these things historically has worked really well."

He noted that there are organic movements for Brisbane, attributed by the upcoming Olympics.

"... all this infrastructure spend, and they've had positive property growth... They need to take more of that narrative and push it out to the global audience to position themselves out of just Melbourne and Sydney when foreigners or the global markets are looking into Australia."

MA Financial chief executive Julian Biggins agrees but noted foreign investors are traditionally more tentative to engage with the capital cities.

The recent research from Knight Frank supports this, noting Sydney has become one of the favourite cities for commercial real estate among foreign investors, drawing almost half of the entire nation's cross-border investment in 2025 for the asset class.

"Foreign capital really wants to be in the big capital cities, while Brisbane and southeast Queensland are attracting a lot of domestic capital, there's only been a bit of foreign capital come in," Biggins said.

"New South Wales will always have a strong heartbeat because of the nature of the city... We've seen quite a few transactions happen in the last 12 months where you've seen foreign capital, whether it's South Korea, Japanese or Singaporean, it's mainly capital from around Asia now."

"But Melbourne is getting an overlay where the stamp duty, foreign tax, and the economic performance of the state have been pretty weak for a while."

Australia is seen as one of the top priorities for foreign investors, particularly across Asia, given the current uncertainty and volatility coming out of the US, Biggins added.

"Australia has climbed the ladder in terms of where it sits in conversations for Asian investors," Biggins said.

"And that's been demonstrated in real estate transactions that we've been involved in..."

For this, Rosen said it is now the time for other cities to shift the general perception of Australia to really capitalise on the attention drawn.

"And taking a couple of the pages out of the box of what got Sydney and Melbourne popular over the years, and what other cities are doing internationally to bring in focus, is what they need to do," Rosen continued.

"Because there's a key opportunity where we've got this window at the moment, where the whole world is looking into Australia, that if they are able to differentiate themselves, it will be a key opportunity to bring in this foreign direct investment."