Brisbane-based developer Cornerstone is pushing ahead with a major commercial project in Brisbane’s Fortitude Valley, lodging plans for a high-rise commercial tower alongside the landmark McWhirters building.
The development is slated for a 1,357sq m site running between 251 to 253 Wickham Street, together with part of 47 Warner Street, currently occupied by a derelict and dilapidated former building.
The 28-storey development will be known as 251 Wickham Street and, if approved, will add 14,500sq m of net lettable area to the fast-growing fringe office market, north-east of the Brisbane CBD.
The scale of the development would be a considerable increase on the preliminary approval currently available for the site which would green-light an 11-storey proposal.
The design for the proposed A-grade office building is led by Brisbane firm Bureau Proberts, with development partners James Project Management and Robert Bird and Partners also overseeing the project.
Bureau Proberts director Liam Proberts said the building offers stepped floor plates, which would create commercial tenancies of varying sizes and needs.
“The Covid-19 pandemic has brought into sharp focus the value and importance of this design approach,” Proberts said.
The proposal features meeting and recreation spaces on levels 15 and 27, a gym with lap pool, sky terraces and balconies.
In the development application, Cornerstone said there had been a renewed focus on council’s “buildings that breathe” guidelines, with the impact of Covid-19 increasing the importance of workplaces that promote mental and physical health.
The building features 55 car parking spaces across three basement levels as well as 108 bicycle spaces and end of trip facilities.
Its proximity to Brisbane’s Fortitude Valley station, currently undergoing a $500 million revamp, is expected to be a drawcard for prospective tenants.
One of the developer’s most significant projects was the revitalisation of an 18-level B-grade tower in Brisbane’s CBD after acquiring it in 2012.
The fully-refurbished building, located at 310 Ann Street, offers 18,360sq m of space designed around a central core and is home to tenants including Allianz Worldwide Partners and the Queensland government.
Cornerstone also has plans in its pipeline for a 2,850sq m site under its control at 301 Wickham Street in Fortitude Valley, where it has approval for a 25-storey, 36,000sq m office building.
This article is republished from https://theurbandeveloper.com/ under a Creative Commons license. Read the original article.
Unit oversupply remains an issue in Brisbane CBD: RiskWise’s Doron Peleg
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
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.
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
|1.||Hawkesbury demand increase since Covid||Rouse Hill-McGraths Hill||Wollondilly (Houses)|
|2.||Rouse Hill-McGraths Hill||Pennant Hills-Epping||Richmond-Windsor (Houses)|
|4.||Hornsby||Eastern Suburbs-south||Gosford (Units)|
|5.||Dural-Wisemans Ferry||Warringah||Hawkesbury (Houses)|
Top greater Melbourne suburbs
|1.||Whitehorse-west||Mornington Peninsula||Macedon Ranges (Houses)|
|2.||Macedon Ranges||Cardinia||Manningham-east (Houses)|
|3.||Manningham-east||Knox||Mornington Peninsula (Units)|
|4.||Mornington Peninsula||Maroonah||Yarra Ranges (Houses)|
|5.||Yarra Ranges||Kingston||Frankston (Units)|
Top south-east Queensland suburbs
|2.||Nundah||Coolangatta||Noosa hinterland (Houses)|
|3.||Carindale||Redcliffe||Gold Coast hinterland (Houses)|
|4.||Surfers Paradise||Ipswich inner||Noosa (Units)|
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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