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City of Logan Emerges as Global Investment Hotspot

City of Logan Emerges as Global Investment Hotspot

The City of Logan is fast emerging as a global investment hotspot in south-east Queensland, buoyed by a strong economic track record, historic levels of infrastructure investment in the pipeline and business confidence on the rise.

Logan has continued to attract a number of multinational businesses and fast-growing start-ups looking to capitalise on the city’s growth potential and enviable location between Queensland’s capital, Brisbane and tourist destination the Gold Coast.

The launch of autonomous drone delivery services in Logan by Wing — a subsidiary of global technology company Alphabet — is just one of the businesses that have funnelled a total of $100 million of private investment into the city over the past 12 months.

Logan is just one of four locations in the world that now has access to Wing’s air delivery service, which flies a range of convenience items by air in just minutes.

Under the helm of chief executive James Ryan Burgess, Wing will focus their Queensland expansion plans in Logan first, with select households in the suburbs of Crestmead and Marsden already having access to the service.

Burgess said what made cities like Logan most attractive for investment was not only the demographic factors but the opportunities driven by growth.

“Logan is one of the fastest growing areas of Queensland, so that’s a great fit for us because drone delivery makes it much easier for people to get the things they need in rapidly expanding metropolises,” Burgess said.

“Logan is also a very innovative community, and the growth and excitement around the city makes it a great place for us to start our Queensland operations.”

Logan is located in the heart of south-east Queensland where around 70 per cent of the state live, and is predicted to be the second fastest growing city in this region.

In just over 20 years, Logan’s population is predicted to grow more than 50 per cent to around 548,000 residents.

This has led to an unprecedented level of infrastructure investment, with more than $18 billion of publicly funded projects under way to support the growing residential population.

 

 

Earlier this year, a $1.2 billion agreement — the largest of its type by any government in Australia, was signed by local authorities and private developers to build essential infrastructure in Logan’s Priority Development Areas Yarrabilba and Greater Flagstone.

This follows the completion of Transurban Queensland’s $512 million Logan Enhancement Project in August, which increased freight productivity by reducing road travel times along some of the busiest transport routes in the region.

Major infrastructure projects in the pipeline has triggered a surge in commercial activity along the Logan Motorway corridor, with large national and multinational businesses including Metcash Hardware, DHL, Queensland Logistics Service, Huhtamaki and Pinnacle Hardware setting up operations in Logan’s industrial precincts.

It’s not only the city’s efficient transport connections and affordable land driving this investment, Logan has advantages beyond its borders.

Within a 40 kilometre radius, Logan has access to a regional catchment of over 2.6 million people, a vast network of suppliers and a diverse pool of potential talent for employers to draw from.

GO1.com, the world’s largest on-boarding, compliance and professional development platform, recently relocated their headquarters from Brisbane to Logan to take advantage of this accessibility.

Co-founder Vu Tran said running a global company from Logan was a strategic decision for GO1.com and their future plans.

“Being in Logan has provided us with the opportunity and space we need to grow and also attract the talent that we need for our growing markets,” Tran said.

“Having businesses like Ikea, John Deere, Avery Dennison all based in the area means they are potential partners for us to engage with.”

City of Logan Emerges as Global Investment Hotspot 2

GO1.com has offices in the United States, South Africa, Vietnam, United Kingdom and Malaysia, and is on track for further expansion, recently securing more than $30 million of investment led by M12, Microsoft’s venture fund.

The increasing investment in Logan is reflected in the city’s economic report card – an annual 3.9 percent increase in the Gross Regional Product in the year ending 2017-2018 and the highest percentage of jobs growth in over fifteen years.

The arrival of businesses like GO1.com and Wing could mark the beginning of an exciting chapter in the city’s development.

For Wing, the city of Logan will be their largest investment in Australia to date and will play a role in shaping what the company will do in cities around the world.

“We’re really going to be investing here in Logan, learning as much as we can from the community and over time looking to apply that to other countries and cities that we may go to,” Burgess said.

“For now, it’s all our attention on Logan and making sure we offer a great service for the community.”

 

 

 

Source: theurbandeveloper.com

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Brisbane

Unit oversupply remains an issue in Brisbane CBD: RiskWise’s Doron Peleg

oversupply issue in Birsbane

Unit oversupply remains an issue in Brisbane CBD: RiskWise's Doron Peleg

EXPERT OBSERVER

The inner-city Brisbane unit market, already hit hard by unit oversupply, continues to remain a huge danger zone for investors since the advent of COVID-19.

Not only is equity risk the major issue for investors, increased vacancy rates and risk to cash flow are also heavily impacting the market.

According to RiskWise Property Research CEO Doron Peleg, things have not improved in the market since the pandemic hit and, if anything, have become worse.

“RiskWise reported in July 2018 that there were 14,813 units in the pipeline in inner-city Brisbane for the next 24 months, being an addition of 20.1 per cent of the current stock,” Mr Peleg said.

“Two years later and there is still a very high level of supply with 5,431 units in the pipeline, making up an addition of 5.9 per cent of the current stock.”

Pete Wargent, co-founder of Buyers Buyers, a national marketplace now offering affordable buyer’s agent services to all Australians, said that rental demand had been weak for CBD apartments for some time.

“The trend has been exacerbated by the pandemic, and CBD rents have been very soft” Mr Wargent added.

Analysis by RiskWise in 2018 showed unit over-supply in inner-city Brisbane had created weakness in the market leading to an elevated level of risk for investors and, therefore, lower valuations and rising defaults on settlements.

“The issue of oversupply is not a new problem and has been there for a few years and the continuous weakness of the unit market in inner-city Brisbane should raise red flags for developers and lenders,” Mr Peleg said.

“Defaults have been rising and will continue to do so.

“One of the key factors has been developers’ lack of foresight regarding unit oversupply as well as the impact of lending restrictions introduced from 2014. It seems there has been no methodological and structured risk-management approach including identification, assessment, and mitigating action plans to address those risks.

“This takes us back to the feasibility stage which includes the assessment of the projected fair market value and the likelihood of defaults and their potential consequences. Developers and lenders must find the right balance between taking risk and making profit.

“COVID-19 has only served to increase the risk. Currently, there are many high-rise properties being offered to a smaller number of investors. This is because there are less investors in the market due to the pandemic.

“The point is that if developers and lenders had put more proper risk-management practices in place, this could all have been avoided.”

Mr Peleg said it must also be remembered the value of off-the-plan property could decrease between the original contract date and settlement resulting in capital loss, as the equity in the home could be reduced, and this was well known in inner-city Brisbane.

He also stressed that investors buying rental apartments unsuitable for families were taking an enormous gamble, with both equity and cash flow risk expected to materially increase. Serviceability is also a major factor for investors who rely on a stable rental income to cover the costs associated with property and particularly the mortgage.

Mr Wargent of Buyers Buyers said houses for investors often carried significantly lower risk for those with the right budget because renters, especially in the more established suburbs, included families and, in many cases, those with permanent full-time jobs. They were also more likely to deliver good medium and long-term capital growth.

Additionally, as rental properties are not fully substitute products with owner-occupied dwellings, there is inherent risk associated with them as they do not appeal to families looking for three bedrooms, with outdoor space, close to schools, transport, and employment hubs.

 

This article is republished from https://www.propertyobserver.com.au/ under a Creative Commons license. Read the original article

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Brisbane

Queensland Extends Commercial Eviction Moratorium

Commercial Eviction Moratorium
Queensland Extends Commercial Eviction Moratorium

Queensland commercial tenants impacted by the pandemic are set to get further relief, with the state government extending the ban on evictions until the end of the year.

The move means that to the end of 2020 commercial leaseholders can’t have their lease terminated if they fall into arrears as a result of the Covid-19 pandemic.

First introduced in March by the national cabinet, the six-month ban on evictions are due to expire at the end of this month.

Leaving out residential tenancies, the Queensland government’s latest announcement pushes the moratorium on evictions in the commercial space to the new date of 31 December 2020.

Queensland’s announcement comes as other states have extended eviction protection.

Last month, Victoria extended its own ban on evictions for both residential and commercial tenants until 31 December.

While Western Australia and South Australia have each put a six-month extension in place for residential and commercial tenancies until the end of March.

Attorney-General Yvette D’Ath said that landlords and tenants had been working together “in good faith” to “tackle the economic challenges”, describing the announcement as “a shot in the arm” for many small businesses still struggling because of the pandemic.

“This extension is about giving businesses, and the thousands of workers they employ, the certainty they need in these challenging times,” D’Ath said.

With no mention made about Queensland residential tenants, the end of the moratorium looks set to remain as 29 September.

The Queensland government’s decision has been criticised by three of the five members of its Covid-19 Housing Security Subcommittee; Queensland Council of Social Service (QCOSS), Q Shelter and Tenants Queensland.

“Since the Covid-19 crisis began, demand for the state’s tenant advisory services has increased drastically,” Tenants Queensland chief executive Penny Carr said.

“Particularly from tenants fearing eviction after losing their jobs or having their income reduced as a result of Covid-19.”

The code extension means that affected businesses can come forward to receive assistance under the code until 31 December.

This article is republished from https://theurbandeveloper.com/ under a Creative Commons license. Read the original article.
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Brisbane

Buyer Demand Builds in the Outer Suburbs

Buyer Demand Builds in the Outer Suburbs
 Buyer Demand Builds in the Outer Suburbs

Buyer demand has significantly jumped compared to last year across all capital cities aside from Melbourne.

The Domain buyer demand indicator shows that the market has rebounded in recent months—revealing the top suburbs piquing buyer interest.

Houses and apartments in the outer-suburban areas of Sydney, Melbourne, Brisbane and Perth, were the highest in demand for the month up to 6 September.

This follows a state of hiatus caused by caused by Covid which is ongoing in Victoria where restrictions have stopped inspections and dropped listings.

Domain senior research analyst Nicola Powell said they tracked people who were most likely to buy, indicated by shortlisting, sending inquiries, inspecting and frequently viewing photos.

“The current health crisis has changed the way we use our homes, and for some altered our purchasing decisions and property wish lists,” Powell said.

“And while Covid-19 lockdowns sent buyer demand into a state of hiatus, activity from people likely to buy has rebounded in all capital cities apart from Melbourne.”

Top greater Sydney suburbs

 Buyer Demand Builds in the Outer Suburbs

NSWHousesUnitsPost-Covid Demand
1.Hawkesbury demand increase since CovidRouse Hill-McGraths HillWollondilly (Houses)
2.Rouse Hill-McGraths HillPennant Hills-EppingRichmond-Windsor (Houses)
3.WollondillyMarrickville-Sydenham-PetershamCamden (Houses)
4.HornsbyEastern Suburbs-southGosford (Units)
5.Dural-Wisemans FerryWarringahHawkesbury (Houses)

Top greater Melbourne suburbs

 Buyer Demand Builds
VICHousesUnitsPost-Covid Demand
1.Whitehorse-westMornington PeninsulaMacedon Ranges (Houses)
2.Macedon RangesCardiniaManningham-east (Houses)
3.Manningham-eastKnoxMornington Peninsula (Units)
4.Mornington PeninsulaMaroonahYarra Ranges (Houses)
5.Yarra RangesKingstonFrankston (Units)

Top south-east Queensland suburbs

 Buyer Demand
QLDHousesUnitsPost-Covid Demand
1.NambourBribie-BeachmereMudgeeraba-Tallebudgera (Houses)
2.NundahCoolangattaNoosa hinterland (Houses)
3.CarindaleRedcliffeGold Coast hinterland (Houses)
4.Surfers ParadiseIpswich innerNoosa (Units)
5.Mudgeeraba-TallebudgeraCleveland-StradbrokeNambour (Houses)

Meanwhile major gains have been made in national vacancy rates to pre-Covid levels with outer suburbs also showing the most improvements.

Residential property prices dropped by 1.8 per cent in the latest quarter according to the Australian Bureau of Statistics.

In Perth, Mundaring houses and Wanneroo units topped the list, Canberra’s Weston Creek was listed for houses and Gungahlin for units. Litchfield, Darwin topped the list in the Northern Territory for both houses and units.

Hobart was the only other city to record a fall in activity over the four week period to 6 September, along with Melbourne, where the most demand was seen for Sorrell-Dodges Ferry and Hobart.

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