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Sunshine Coast next hot property market

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Queensland’s Sunshine Coast is a burgeoning commercial property market, thanks to four major projects taking place in the region. The latest CBRE Viewpoint report has found that the alignment of four major developments in the region have propelled the Sunshine Coast into a period of major growth, one that hotel operators and investors should make the most of.

The four key projects that will drive population growth and property development of the area are the construction of the Sunshine Coast Public University Hospital; the planned Maroochydore Principal Development Area; the proposed expansion of the Sunshine Coast airport; and the development of the residential area of Aura (formerly known as Caloundra South).

CBRE managing director Rem Rafter, believes these four projects make the region an attractive option for investors.

“These key projects will redefine the Sunshine Coast’s property landscape, presenting new opportunities that will attract both interstate and offshore investors.”

Each of the four major projects should lead to further population growth and, in turn, commercial land development. The Sunshine Coast Public University Hospital and the associated Kawana Health Campus, are due for completion this year. Craig Godber, CBRE’s research manager, suggested that there would be development flow-on effects from the project, including a future town centre and commercial precinct.

The Maroochydore City Centre Priority Development Area (PDA), which covers 62 hectares of land, is intended as a new central business district for the Sunshine Coast region. Included in the development are 165,000 sqm of commercial space and 2000 private dwellings. Property within the development will become available incrementally over the next two decades.

Aura is currently the largest residential city development project and will be constructed over a 30-year span. Upon completion, there will be approximately 20,000 residences, housing an approximate population of 50,000. The proposed expansion of Sunshine Coast airport would also see a significant boost in tourism to the region.

Glenn Price, CBRE’s senior manager of hotels in Queensland, believes these factors make the region and Queensland in general an enticing market for hotel operators and investors in 2016.

“Over the past few years, the Queensland hotel market has been starved of quality opportunities, however, improving conditions in 2016 will see demand strengthen for hospitality assets in the region.

“The Sunshine Coast is a desirable area for tourism and living, underpinned by strong local growth off the back of an expanding population and a number of significant projects such as the new Maroochydore City Centre and Public University Hospital.

He added: “The lower Australian dollar is also supporting the holiday market, with more tourists from both overseas and interstate taking advantage of the more favourable economic conditions to visit some of Australia’s most sought after destinations.

“The Sunshine Coast boasts some quality pubs and gaming assets, which will be of strong interest to both corporate and private buyers in 2016.”

“In 2015, we saw multiple new entrants to the Queensland hotel market and we expect that to continue in 2016, with a particular focus from interstate buyers looking to capitalise on the higher returns on offer.”

Price also suggested that larger than average yields will likely attract investors.

“We expect the Sunshine Coast will entice a number of new entrants this year, with it offering yields of 10-12 per cent for going concern hotels when compared with the NSW market, which offers around 8-9 per cent.

“Investment assets will also be of strong interest to buyers, with those backed by secure covenants to be on the radar of investors, offering yields of circa 5.5-7 per cent.”

 

Original Published On: http://www.theshout.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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