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Office vacancies tighten as demand from businesses increases

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THE Property Council of Australia’s latest Office Market Report, released today, shows the office vacancy rate on the Sunshine Coast decreased by 2.7 per cent over the last twelve months, dropping to 9.2 per cent.

Queensland Executive Director of the Property Council, Chris Mountford, said a combination of increased demand in 2015 and withdrawal of space from the market has maintained the Sunshine Coast’s significantly lower office vacancy rate than the Gold Coast or Brisbane.

“There was a solid increase in demand for B-Grade office space over 2015, with very little new space added to the market last year,” Mr Mountford said.

“Throughout 2016, however, the vacancy rate is expected to increase with an additional 23,400sqm of space due to come online.”

“While this additional space will increase vacancy overall on the coast, currently the largest contiguous space available in the key markets of Kawana and Maroochydore is 300-400sqm.

“Therefore this additional supply may create an opportunity for larger tenants looking to relocate to the coast or local businesses who need to expand.”

The longer term outlook is less clear for the Sunshine Coast with very little new office space in the pipeline beyond mid-2016, and Council’s vision for a new CBD still several years away.

“As a relatively small market of circa 150,000 square metres, any stock additions or withdrawals have the potential to significantly impact on the overall health of the commercial market,” Mr Mountford said.

“The Property Council’s first event of 2016, being held at The Lakehouse on 26 February, will explore the impact that major projects, such as the CBD, will have on the future of the Sunshine Coast’s various property markets.”

Originally Published On: http://www.sunshinecoastdaily.com.au/

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Abacus Offloads Novotel Twin Waters for $88.5 Million

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novotel twin waters
Abacus Property Group has sold the Novotel Twin Waters for $88.5 million to Melbourne-based asset trader Shakespeare Property Group.

The four-star, 361-guest room resort is located on Queensland’s Sunshine Coast.

The property has been on the market for the past two years as a result of a number of failed and withdrawn bids.

Last year, the Chinese HNA Group pulled out of a deal to buy the resort.

HNA, who have been focused on tourism-related ­assets, also has plans to acquire the Sunshine Coast Airport but missed out to Palisade Investment Partners.

novotel twin waters

Shakespeare Property Group has snapped up Novotel Twin Waters Resort on Queensland’s Sunshine Coast.

New owner Shakespeare is a value-add investor that repositions, leases and sells commercial towers.

It has a strong record along the east coast of Australia.

The hotel is the Abacus’s last remaining asset after unit holders voted for a sell-down of assets three years ago.

In addition, Abacus has sold an adjacent, separate parcel of land for $11 million, due for settlement in October 2019.

The site, between the Maroochy River and the beach, has been touted as having the ­capacity for two more resorts.

Abacus has had a strong focus on reworks its portfolio with a sharpened strategy this year.

The group recently sold the Bacchus Marsh shopping centre in regional Victoria to property investor Colin De Lutis for $61.65 million.

Abacus also purchased a $93.5 million inner-city office building in Melbourne and another $48.85 million commercial building in Sydney’s Alexandria.

The group also entered into a venture partnership with global real estate management firm Heitman, acquiring an office tower in Brisbane’s Fortitude Valley for about $170 million.

Source: theurbandeveloper.com

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High-profile leases snapped up

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High-profile leases snapped up

Bentleys Accountants and Coronis Real Estate each signed new five-year leases with options at 9 Nicklin Way, Minyama, where both deals were struck by CBRE’s Brendan Robins and Ryan Parry.

After a 38-year base in Caloundra, Bentleys have centralised their Sunshine Coast office to Minyama and Coronis has moved from Mooloolaba, into the 1200sq m A-grade building.

Mr Robins, who concluded the Bentleys deal, said the accountants have just executed a first-class office fit-out over 426sq m on level 1, and will be paying about $180,000 gross per year plus GST.

Coronis have moved into 290sq m made up of ground floor retail and first level office. They spared no expense on their new fit-out which includes a new espresso coffee offering with alfresco dining on the ground floor.

Mr Parry negotiated the new lease on behalf of the property owner and they will be paying about $130,000 gross per year plus GST.

“We’re pleased to have concluded two long-term leases over more than 700sq m of office space for our client, in quick succession. It is an outstanding result,” Mr Parry added.

There are only two remaining opportunities within the property with 89sq m on the ground floor and 185sq m of space on the first level.

Originally Published: www.sunshinecoastdaily.com.au

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Queensland Economic Outlook ‘Positive’: Deloitte

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Queensland Economic Outlook

Construction and development appeared healthy to Deloitte’s analysts, who attributed some of Queensland’s strong economic outlook to high levels of interstate migration and international tourism, which have encouraged a growing list of tourism-related construction projects.

Queensland’s international tourist arrivals are expected to remain solid over the forecast period, averaging growth of 4.7 percent out to 2021.

There were reasonable gains in engineering activity in Queensland, and Cross River Rail was in the planning stages.

The report also put a focus on livability and housing affordability. In the midst of the continuing debate over house prices and quality of living, Deloitte reported that Queensland has less cause for concern.

Queensland’s place in the national picture of housing affordability is a comparative advantage. In the midst of a housing price boom, living in Queensland remains more affordable than in the southern states.

While Sydney and Melbourne house prices have experienced year-on year growth in the double digits, Brisbane has experienced a modest 3.5 per cent growth.”

Despite this optimism, Queensland was revealed to be mirroring the national trend, showing a slight decline in outright home ownership and owners who have a mortgage.

Rental stress was recorded to be higher than the national average, with more Queenslanders renting than owning their own home compared to the rest of the country.

“But with a modest decline in rent in the June quarter CPI figures, increasing vacancy rates, and new supply from an easing residential construction boom the conditions could result in Brisbane becoming a renter’s market,” Deloitte said.

Job growth was accelerating in Queensland and while population growth had “bottomed”, it was now back in line with the national average — although it remained below the level experienced in the state five years ago.

In less positive news, CommSec’s latest State of the States report found Queensland’s economic performance had slipped to sixth place, hampered by weak business investment and retail spending.

CommSec chief economist Craig James said that despite a recent surge in residential construction, oversupply is still a concern. Queensland would benefit from increased revenue generated by the state’s gas industry as well as spending that resulted from a rise in employment.

Queensland Treasurer Curtis Pitt defended the state’s ranking saying that the CommSec report understated the state’s performance.

“Most people’s economic indicator is whether they have a job or not and both the DAE and CommSec reports highlight our strong performance in job creation,” Pitt said.

Of Queensland’s population of 4.7 million, more than half were recorded to be living outside of the state’s capital city. Queensland’s south-east corner, including Brisbane, Gold Coast, and Sunshine Coast, saw a growth rate in population twice that of the rest of the state.

Despite Queensland’s size, urbanization has taken hold — 66 percent of the population living within 0.6 percent of Queensland’s total area.

Originally Published: brisbaneinvestor.com.au

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