Thursday, April 19, 2007

Will You Have Hotel Guests Staying In Your Building?

A number of Brisbane apartment buildings are being slowly turned into hotels by the Oaks Group, who have purchased management rights for the buildings.

If you are thinking of buying an apartment to live in, or renting an apartment for six months or more, you should take care not to buy or rent in apartment buildings that are or will soon become short term stay accommodation. The reason - the other "residents" of the building may only be staying for one or two nights -- there have been complaints about noise, parties, security issues, overuse of facilities such as pools, rubbish left in halls, and parking in the wrong spaces.

The apartments in such buildings will not, in my view, have good capital gains, as they will be less desirable for owner-occupiers and will become run down over time.

You should take extreme care before buying or renting in the following buildings:

  • Festival Towers
  • Felix
  • Charlotte Towers
  • 212 Margaret Street
  • River City
  • Any building managed by the Oaks Group
  • Any building built by Devine
  • Any building where the management rights are controlled by a real estate agent named Marshall.

(I see that a 2 bedroom apartment in Festival Towers, on level 31, recently was sold at auction by Ray White for $410,000. Another one on level 39 was unsold with the highest bid less than $450,000. It is now listed for sale at $499,000. Other apartments in the same building that are not as good as listed for sale in the high $400K and above $500,000 -- TAKE CARE!)

Here is a recent press report:

Oaks Hotels & Resorts has ramped up its growing domination of the Brisbane CBD accommodation market after snaring the management letting rights (MLRs) to two premier high-rise apartment towers, the 41 level Festival Towers and the 39 level River City project, for $14.1 million.

Today’s announced deal for the two properties delivers an additional 532 apartments to the rapidly expanding Oaks stable.

Managing director Brett Pointon says the latest acquisitions will boost Oaks Brisbane CBD portfolio to seven high-rise apartment buildings including Oaks 212 Margaret Street, Oaks Lexicon Apartments, Oaks North Quay, Oaks on Felix and Charlotte Towers (Oaks to take over management in October 2007).

While the 532 apartments delivered under the latest acquisition will initially be included in Oaks permanent letting pool, the company expects to progressively convert a majority into its short-term serviced letting pool to compete in Brisbane’s burgeoning short-stay market.

There is also a further 89 apartments in the buildings that are owner occupied or managed by external agents.

Pointon says Oaks expects to swell its short-term room stable from the 3,489 to over 3,600 serviced apartments by the end of June 2007.

In addition to the MLRs to the two properties, Oaks also acquired the freehold to the manager’s apartments in both properties for $1.45 million.

He adds the two latest acquisitions and the commissioning of Charlotte Towers deliver Oaks an unrivalled position in the increasingly buoyant Brisbane CBD accommodation market, and deliver a pipeline of units to further swell its serviced letting pool over the next two to three years.

"We’re expecting the market to continue tightening given the lack of any mooted major new hotels or serviced apartment projects in the CBD for the foreseeable future, with the exception of Charlotte Towers, which we’ve already secured the MLR for," he says.

"With Brisbane now boasting the highest hotel occupancy rate in Australia at around 80 percent, this strengthened presence in the local market will prove a cornerstone of Oaks financial performance over the next several years."

Tuesday, April 10, 2007

Admiralty One

I am often asked to recommend apartment buildings to new arrivals in Brisbane, either for long term rental accommodation or for purchase. This is the first in a series highlighting what I believe are good apartment buildings in Brisbane.

My favourite building is Admiralty One (or Admiralty I), at 35 Howard Street, Brisbane.

It is 28 floors (87 metres) high, all residential apartments. The building was completed in 1992. It has less than 160 apartments.

It is in an excellent location, right on the Brisbane River, and a very short walk along the river boardwalk to the downtown area.

On the lower levels, there are seven apartments per floor. At the front (i.e., on the river side) are a large 2 bedroom (132 sqm), a smaller 2 bedroom (106 sqm), a one bedroom (79 sqm) and a large 2 bedroom (132 sqm). All four of these apartments have river views, and regardless of what floor you are on, the views are fantastic. The views include the Storey Bridge in one direction and the Kangaroo Point cliffs in the other direction. At the back of the building, with city views or partial river views, are two one bedroom apartments (72 sqm) and a two bedroom apartment (98 sqm).

On the higher levels, there are five apartments per floor (three at the front, two at the back). The front apartments include three bedroom apartments, and the sizes of the front aparmtents range from 149 sqm to 197 sqm). At the back, there are two apartments at 105 sqm.

There is also a subpenthouse level (three apartments) and a penthouse level.

As you can see, the apartments in Admiralty One are much larger than apartments in newer buildings. For example, a typical 2 bedroom apartment in a new building is lucky to have 85 sqm of internal floor area. In Admiralty One, there are 2 bedroom apartments with over 115 sqm of internal floor area.

The building is well managed, and the body corporate committee is very professional and caring.

I believe that there are more owner-occupiers than renters in Admiralty One.

The building has undercover secure resident parking, secure guest parking, a small indoor pool, a gym and an onsite restaurant (Bubbles and Beans).

Positive Aspects
  • Large apartments
  • Fantastic views from front apartments
  • Absolute riverfront
  • Excellent inner city location
  • Four elevators for 28 floors (a very good ratio compared with newer buildings)
  • Good security
  • Pool
  • Gym
  • Caring and more mature residents
  • Good on-site management
  • Most apartments are airconditioned
  • Most apartments have their own laundry room
  • Good closet and cupboard space
  • Quality kitchens and bathrooms
  • Close to Marriott Hotel and restaurants
  • Far enough away from Storey Bridge so cannot hear traffic noise.
Negative Aspects
  • No view from the pool, as it faces the city side
  • Smaller balconies
  • Hard to get river front apartment in this building
Rental Inquiries

The best place to start is the on-site manager. Recently, there has been a change in on-site managers, as the previous manager (Leon Azar) moved to Arbour on Grey at South Bank. The new on-site managers are Jenny and Kingsley Short, telephone 07 3831 6455

The onsite manager maintains an Internet website at:

Typically, a large furnished two bedroom apartment with river views will rent for more than $640 per week. An unfurnished two bedroom apartment with river views will rent for $430 per week.

Each owner will furnish the apartment to a different standard, so the furnishing in one apartment is not at all representative of the style, quality or age of the furnishings in any other apartment.

Sales Inquiries

I recommend Margaret Waters as a good agent who knows riverfront apartment buildings.

An agent from West End, Open House Realty, is trying to get more business from sales in Admiralty One, but my experience with them has not been good for a number of reasons. I also understand that Open House is somehow associated with the on-site managers, as well as the on-site managers for a nearby building (River Place). It appears that they are trying to sell apartments to investors, rather than owner-occupiers, as the investors will then rent the apartment through the on-site managers.

Recent sales in 2007 include:
  • Apartment 56 (Floor 9, 106 sqm, 2 bedrooms, river side) for more than $650,000.
  • Apartment 92 (Floor 14, 1 bedroom, river side) for more than $500,000


This Blog is designed to provide information about buying or renting apartments in Brisbane, Australia.