Sunday, September 14, 2014

Spice Apartments at South Brisbane

The Spice Apartments development at South Brisbane is currently being sold off-the-plan.  According to the agents selling these apartments, most have sold.

It is a 14 level development, with two towers sharing a common podium.  The complex overlooks the onramp and tolling infrastructure for the Go-Between Bridge.  It is river front, sort of, with trees and and bikeway between the apartments and the river.  Many of the apartments will have no views, or will only have views of a busy road or industrial buildings (that will probably get redeveloped into apartment or office towers.)  Any city views are likely to be built out.

Example prices:
  • One bedroom on level 2 with car space, 54 sqm internal, with balcony and court yard, so total 78 sqm.  No view.  $429,000.
  • One bed, one bath, level 2, 49 sqm internal, with balcony and court yard, total 77 sqm, $420,000.
  • Two bed, one bath, 1 car, level 12, internal - 63 sqm, total 76 sqm, one bedroom is internal with no windows (so this is really a one bed plus study) - $526,000
  • Two bed, two bath, 1 car, level 3, internal - 83 sqm, total 101 sqm - $585,000
In my opinion, these are expensive prices for small apartments that are in a poor location.  Even though only 15 minutes walk to the city, there is not much currently in this area.  It is a long walk to South Bank, even though the sale brochure for the development has lots of South Bank photos.

The body corp fees for the first year are low, around the $3,000 a year mark.  My guess is that these are likely to increase substantially in subsequent years.

Rents for unfurnished apartments are provided by the developer:
  • 1 bed - $410 to $480 a week
  • 2 bed, 2 bath - $550 to $640 a week
  • 3 bed, 2 bath - $850 to $950 a week.
It will be interesting to see if these rents are actually achieved.  You can rent a 110 sqm two bed, two bath apartment at South Bank, with river and park views, fully furnished for $690, so it is hard to see how these rents are possible.

Before buying, I would suggest looking at Vue Apartments, which are diagonally opposite the bridge and river.  Compare actual sales prices and actual rents for similar apartments, and look at this building's financial performance.

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