Demand Outstrips Supply in Logan Accommodation Market - Queensland Property Investor
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Demand Outstrips Supply in Logan Accommodation Market

Demand Outstrips Supply in Logan Accommodation Market (1)

A surge in private and public investment, growing visitor numbers and game-changing tourism projects under way is driving the demand for short-term accommodation in the City of Logan.

Located just 30 minutes’ drive to major destinations – Brisbane to the north and the Gold Coast to the south – Logan welcomes 1.4 million visitors each year and continues to have strong levels of growth in domestic and international overnight travel.

The $12 billion of tourism infrastructure injected into the wider region, places the city in a strategic position to take advantage of the boom in visitors to south-east Queensland.

However, recent growth forecasts suggest occupancy rates in Logan will exceed 80 per cent by 2021, set to trigger a severe undersupply of rooms and leakage of trade by 2026.

Logan’s current supply is limited – at around 300 rooms across 12 facilities, it comprises primarily of motel style accommodation concentrated along arterial roads.

Despite high occupancy rates, no new hotel stock has been developed in more than a decade.

As cities like Brisbane focus on servicing the leisure travel market, Logan has the potential to grow its stake in the business travel market.

Demand Outstrips Supply in Logan Accommodation Market 1 (1)

Home to more than 21,000 registered businesses, many headquarters and operational bases in Logan generate a substantial and continuous demand in overnight room stays.

Just one example is global company John Deere – its headquarters for Australia and New Zealand is located in Logan and receives around 700 domestic visitors every year for training alone.

The demand metrics on population and business growth indicates a need for 65,000 additional room nights in Logan up until 2036 – equivalent to 180 additional rooms.

When compared to similar areas, Logan is undersupplied in the number of commercial short-term accommodation rooms relative to population, workers and visitors.

AreaRoomsPopulationBusinessesHospital bedsWorkers
Logan318320,58321,221436101,979
Springfield10537,6611,7306413,012
Kawana16518,27088656010,535
Parramatta2,060226,14924,519959137,952
Ryde1,400116,30211,92034784,410

As one of the largest employers in the city, the Logan Hospital in Meadowbrook is one of the busiest health service providers in the region and has recently kicked off its $460 million expansion project.

Meadowbrook has been identified as a hotspot for potential accommodation facilities, aligned with council’s master plan to develop the centre as a medical and health precinct.

With projects like the hospital under way and large private enterprise investing in Logan, the demand could outstrip supply faster than predicted.

In the last financial year, building activity in Logan was valued at over $800 million.

A stream of commercial activity saw large companies including national coffee franchisor Zarraffa’s Coffee, global logistics leader DHL and world-first commercial drone delivery service providers Wing (an Alphabet company) establish their operations in Logan.

Zarraffa’s Coffee moved into their $20 million purpose-built national headquarters from the Gold Coast to Logan in August this year.

The company’s new HQ will support 90 plus stores across Queensland, New South Wales and Western Australia and provide the space to progress their future expansion plans.

Spanning 18,000sq m, the site also combines a roastery, a warehousing, packaging and distribution hub, factory concept café, and the $50 million Distillery Road Market project being delivered by the company’s development arm Tonken Property Group.

Headed by founder of Zarraffa’s Coffee, Kenton Campbell, Distillery Road Market is set to become a world-class food experience destination akin to iconic markets such as Chelsea Market in New York and The Grounds of Alexandria in Sydney.

Campbell said the timing was right to relocate to Logan, given its central location along the growth corridor between Brisbane and the Gold Coast.

“From the point of view of customers, staff and suppliers, there is no better place, than where we are right here,” Campbell said.

“Logan has given me the ability to create something special at Distillery Road Market and for Zarraffa’s.”

Distillery Road Market will be the first of its kind in Logan and Queensland, and is part of a growing tourism cluster in the Beenleigh and Eagleby area.

Demand Outstrips Supply in Logan Accommodation Market (1)

Local attractions such as Beenleigh Artisan Distillery, Australia’s oldest registered distillery, and award-winning Aboriginal live theatre experience, Spirits of the Red Sand, draw in both domestic and international visitors.

In the next few years, the city’s strategic focus on developing its capabilities in the business, cultural and sports events sectors, will see Logan’s relatively youthful tourism industry continue to evolve.

Over the past 6 months, Logan City Council’s events acquisition program in partnership with Sports Marketing Australia has since attracted attendance of more than 14,000 competitors and spectators across 50 event days.

Rick Sleeman, managing director of Sports Marketing Australia said that Logan had an accessible location and the right event infrastructure in place to host major sporting events.

“A capacity and capability assessment identified Logan’s potential to become a sports super centre in south-east Queensland,” he said.

“Logan has world-class facilities from PGA standard golf courses, sporting fields, indoor courts and 2000-capacity arenas, plus access to national and international airports making the city an ideal host.”

In 2018, the Brisbane Roar Football Club invested $9 million to develop a state-of-the-art training facility and operations base at Logan Metro Sports Park with plans to host tournaments.

And the recent $65 million whitewater adventure park proposal, now at the pre-feasibility stage, will be a game-changer for Logan and the region – with the potential to become an iconic tourism asset and future Olympic Games venue.

The demand for short-term accommodation continues to escalate as the line-up of major sporting tournaments join Logan’s events calendar.

Given the strong demand fundamentals and opportunities across business, events and the emerging tourism industry in Logan, there is a demonstrated gap for a business style, specialist hotel or serviced apartments.

To support this shortage in supply, Logan City Council offers incentives for eligible new short-term accommodation developments that achieve a 3.5 to 5 star rating.

 

 

Source: theurbandeveloper.com

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Brisbane

The Brisbane suburbs where house prices are higher than last year

The Brisbane suburbs where house prices are higher than last year

The historic suburb of Windsor in Brisbane’s north has seen the biggest growth in median house prices in the last year, with a 17.2 per cent increase year-on-year.

New figures from Domain have revealed the top 10 suburbs whose median house price has risen the most year-on-year. Despite a largely flat market, there are still plenty of suburbs where prices are surging.

Windsor had the highest increase in median house price at 17.2 per cent year-on-year, followed in second place by the leafy inner-western suburb of Auchenflower which saw a 11.4 per cent increase.

Other suburbs in the top 10 include Queenslander paradise Newmarket (10.9 per cent increase), the massive blocks at Bridgeman Downs (9.8 per cent increase), and the outer-western suburb of Heathwood (8.3 per cent increase).

Ray White Wilston principal Allistair Macmillan said the massive increases in price at top performer Windsor were likely due to the suburb not always getting the recognition it deserved.

“For a long time Windsor has been slightly undervalued,” he said. “It’s so close to Wilston and Grange. [They’ve] always been supremely popular with families, I think Windsor was dragging the chain a little bit with those values.

“When you look at values in Windsor, they can vary quite a large degree depending on whereabouts in Windsor they are positioned. What we’ve found is that now the difference between the two sides of Gympie Road is nowhere near as prevalent as it once was.

“Of late, people have really come and been able to see the value Windsor does offer.”

Mr Macmillan said other contributing factors include the recent multimillion-dollar redevelopment of the Albion public transport exchange. Buyers on the eastern side of the suburb in particular have expressed interest in the plan.

The Brisbane suburbs where house prices are higher than last year 1

The vast majority of buyers in the area are younger families who are looking to be in the Windsor State School catchment area, and are attracted to the many local parks, bikeways, and public transport options.

“Stock is incredibly tight,” Mr Macmillan said. “Generally speaking if you look at the volume of properties, there’s not a lot that are for sale in Windsor. It’s still a very tightly held suburb.”

Elsewhere, the northern suburb of Northgate also fared very well, with a median house price increase of 8.9 per cent year-on-year. Local agent Dwight Colbert at Ray White Aspley said the location and amenities were the big drawcards.

“[We’ve seen] popularity due to the proximity to the Brisbane CBD, Brisbane Airport, and also an array of public transport,” he said. “You are on the Northgate train line, which is the main one on the north side, and the hub.

“You’re between Nundah Village, you’ve got Banyo Village, you’ve got good access to the Gateway [Motorway], Toombul Road, Sandgate Road, Gympie Road. It’s quite a desirable locality to get in and out of everywhere.”

Mr Colbert said the area was traditionally seen as a haven for older buyers, but in recent years many young couples and professionals had taken the plunge.

The Brisbane suburbs where house prices are higher than last year

“There is a lot of property development going on in Northgate as well,” he said. “So a lot of the older, bigger blocks are being subdivided. Which is also certainly going to help with the average house price.”

West Brisbane family-favourite Auchenflower pulled out a particularly impressive result, posting a 11.4 per cent increase in median house price year-on-year. This makes it the third-most expensive suburb in the city, up from 12th last year.

Place West principal Andrew Degn credits the suburb’s massive gains to the recent completion of major infrastructure in the area.

“Five or six years ago they finally finished gentrification of the old Milton tennis centre and turned it into a park called Frew Park, which is adjacent to [Milton State School], and the playground, and that goes through to the Rosalie village,” he said.

Auchenflower also features the Wesley Hospital, the recently upgraded Milton State School, and various inbound and outbound public transport options. Mr Degn was so passionate about the area he decided to buy and live there himself.

“Real estate people are supposed to know good real estate, and I live in Auchenflower,” he said with a laugh. “So there you go, I’m personally responsible for pushing the price up.”

Top 10 suburbs with the largest house price increase since last year

1. Windsor – 17.2%
2. Auchenflower – 11.4%
3. Newmarket – 10.9%
4. Yamanto – 9.9%
5. Northgate – 8.9%
6. Heathwood – 8.3%
7. Brassall – 8.1%
8. Toowong – 7.6%
9. St. Lucia – 7.4%
10. Hendra – 7.1%
11. Karana Downs – 7.1%
12. Indooroopilly – 6.9%

 

 

Source: www.domain.com.au

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Brisbane

Five Australian Cities Make World’s Top 30 Luxury Residential Markets

Five Australian Cities Make World’s Top 30 Luxury Residential Markets

Australia’s ultra-luxury residential market, largely unaffected by the impact of recent lending restrictions, has continued to record positive growth in the prestige sector of the market.

Sydney, Melbourne, Brisbane, the Gold Coast and Perth make up the five Australian cities which rank in the world’s top 30 cities for luxury residential price growth.

The major east coast cities of Sydney, Melbourne, Brisbane and the Gold Coast have now recorded 25 quarters, or more, of positive annual growth for luxury property, according to Knight Frank’s Prime Global Cities Index for the third quarter 2019.

Defined as the most desirable and expensive property in a given location, prime property is generally the top 5 per cent of each market, by value.

Sydney ranks 17th in the global rankings, with 2.6 per cent annual growth, Melbourne at 21st spot recording 2 per cent growth.

Brisbane followed closely ranking 22nd with 2 per cent growth, the Gold Coast which was included in the Index for the first time earlier this year moved up the rankings to 26 with a 1.3 per cent increase, and Perth ranked at 30th recording a 0.7 per cent rise.

Knight Frank’s Prime Global Cities Index

City12-Month Change (Q3 2018 -Q3 2019)
1. Moscow11.1%
2. Frankfurt10.3%
3. Taipei8.9%
4. Manila7.4%
5. Berlin6.5%
6. Guangzhou6.2%
7. Geneva5.6%
8. Zurich4.5%
9. Delhi4.4%
10. Madrid4.2%
17. Sydney2.6%
21. Melbourne2%
22. Brisbane2%
26. Gold Coast1.3%
30. Perth0.7%

Knight Frank’s head of prestige Residential Deborah Cullen says the top end of the market is showing more consideration and time in transacting.

“There is still strong interest from local and expat buyers for blue ribbon areas and for “best in class” assets, in particular the waterfront areas of Sydney,” Cullen said.

“Growth in prime property prices closely follows the performance on the stock exchange,” Knight Frank head of residential research Michelle Ciesielski said.

“And there have been some significant gains made on the Australian sharemarket in 2019.

“Collectively the Australian prime market has continued to see sustainable growth of 2 per cent in the year ending September 2019, whilst the sharemarket recorded a 7.7 per cent return,” Ciesielski said.

Slowdown gathers pace in top-tier cities

The global cities index increased by just 1.1 per cent in the year to September 2019, down from 3.4 per cent last year, with slower prime price growth attributable to mounting economic headwinds.

Despite a longer-than-expected period of loose monetary policy and steady wealth creation, the report notes that luxury sales volumes are at their weakest for several years in many of the first tier global cities.

“Slower global economic growth– the IMF lowered its 2019 forecast from 3.3 per cent to 3 per cent in October – along with escalating headwinds: US-China trade relations, Hong Kong’s political tensions, a US presidential election in 2020 and the Brexit conundrum are influencing buyer sentiment,” the index notes.

Moscow recorded the highest rate of growth with an 11 per cent increase over the year to September.

The report notes that Moscow leads the index largely due to strengthening demand and the completion of a number of high-end projects in prime areas like Ostozhenka and Tverskoy.

The prime global cities index is a valuation-based index that tracks the movement in prime residential prices in local currency, using data, across 40 cities.

 

 

Source: theurbandeveloper.com

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Brisbane

Brisbane Plans CBD Riverfront Renewal

Brisbane Plans CBD Riverfront Renewal

New plans to revitalise Brisbane’s CBD riverfront, a 1.2 kilometre stretch of river frontage from the City Botanic Gardens to Howard Smith Wharves, has been released.

New ferry and CityCat terminals are included in Brisbane City Council’s draft master-plan, which aims to improve river access and cement the CBD river frontage into “a world-class employment and lifestyle precinct”.

The draft plan includes an increase of the current pathway to an eight-metre-wide promenade which would span the riverfront, and includes an increase of green-space, trees, and public art.

“This is just one of the ways we are making the Brisbane of tomorrow even better than the Brisbane of today,” Brisbane City Council said of the draft plans released on Thursday.

Brisbane Plans CBD Riverfront Renewal 1

The riverfront precinct is currently home to more than 30 dining destinations and 1.6 hectares of parkland.

The draft plan also includes a proposed new green bridge connection at Kangaroo Point.

“It’s part of our bigger plan to connect people and places,” City Planning Chair Matthew Bourke said.

Bourke says the draft plan took cues from well-known waterfronts, including the likes of San Francisco’s Fisherman’s Wharf and Singapore’s Marina Bay.

Property giant Dexus is under way on its $1.4 billion Waterfront project transforming Brisbane’s Eagle Street Pier.

Council’s draft masterplan for Brisbane’s riverfront will be open to public consultation from Monday 11 November through to early December.

The final masterplan will be released in 2020.

 

 

Source: theurbandeveloper.com

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