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Margaret Street Developments

Margaret Street has two new buildings under construction. They will impact:

• Oaks 212 Margaret
• River City Apartments
• Charlotte Towers and River Park Central
  

Meriton's Brisbane

Triguboff still a fan of Brisbane

17 Apr 2008 | The Australian Financial Review | Michelle Singer

"The Sunshine State agrees with Meriton and billionaire boss Harry Triguboff's approach to development..."

-----------------

This recent story in the AFR states that Meriton's tower on Adelaide Street in Brisbane will have 403 apartments and 200 serviced hotel suites. There will be a 10 level underground carpark. Construction will commence this year.

Meriton's second Brisbane project, the Hercshel Street building, will be up to 90 storeys.

Mirvac's Tennyson

According to the Australian Financial Review, a penthouse apartment in Mirvac's Tennyson Reach development recently sold off-the-plan for $5.25 million. It is 731 sqm. The second stage (92 apartments) is reported to be 25% sold.

Collier's Opinion of Residential Development Market in Brisbane

• Experiencing differing levels of demand for varying price segments, ie $1m - $1.5m the best, $600K - $900K poor.
• Projects with long settlements tracking the best.
• Slow sales for projects with short construction timeframes, are midway through construction or are completed.
• Supply levels are fine and should continue to reduce as a lot of proposed developments do not get off the ground.
• Fundamental property drivers other than interest rates are very good and improving however negative sentiment from bad press is severely affecting this.
• Agent incentives and price rebates / negotiation items are increasing however we see this a short term trend as the major driver of this related to June 30 reporting. Most projects have achieved good sales over the past 24 months and as such are in strong positions. Extended negative reporting and sentiment could however increase these past this date.
• Development site market has softened with supply levels increasing dramatically in the last two months. However buyers are taken a “sit and watch” approach.

See report from 2008 Residential Market Summit (March 30 & April 1, 2008)
http://www.affordablehome.com.au/files/pdf/Colliers-International-Advanced-Residential-Marketing.pdf

also, see ANZ's report - Housing Supply Shortfall, from the same Summit.

Evolution Reviews

The Evolution Apartment building at North Quay in Brisbane is now complete and people have moved in.

Unfortunately, it is being run as a short term and holiday "hotel". You can book at wotif.com and stay the night. Or you can spend more than $2 million and buy the penthouse and share your facilities with overnight visitors.

I visited last week, and these are my opinions.

General:

The views from some of the apartments are magnificent, especially from the higher floors and those looking down the river in the South Eastern direction.

The quality of finishes is generally good. Ducted air-conditioning, good kitchens, floor-to-ceiling tiles in bathrooms, plenty of cupboard space in most apartments, good security, nice windows and sliding doors.

Two elevators, both spacious.

I didn't like the car parking -- the driveways were too narrow.

The pool area on level 6 is relatively nice. A big outdoor space, with bbq and good light. An indoor kitchen nearby. Also, a TV room. The gym was very small. When I visited, the pool area (but not the pool itself) was getting a lot of use. A large group having a bbq and another in the TV room.

One feature that the developer highlighted in advertising was the communal sky lounge on level 36. It has a quality kitchen and pool table, plus small TV and lounge area. It is not a large area overall. But, if you wish to use it, you have to pay a $200 fee to the on site manager!

I did not like the noise from the South East Freeway, which could be heard in all apartments that have river views. It is one of the busiest roads in Brisbane, and is directly below the building (between the building and the river). This is a major drawback. Some apartments had double sliding doors, which cut down the noise when closed. Sitting on the balcony was very noisy.

Type A Apartment Two bed, two bath. (84 sqm internal, plus two balconies, with total space of 102 sqm)

Overall, this apartment had a good feel. It seemed larger than 84 sqm internal. The main balcony was a good size - it looks one direction along the South Bank river reach and the other direction along the Coronation Drive river reach.

The apartment has a westerly aspect, which is a negative. The living room / dining room is, however, small. One couch was pushed up against the kitchen bench, and the dining table pushed up against the wall.

There is a large entry and hallway, that includes a good study desk.

The bedrooms are relatively separated. The main bedroom is a good size with a large ensuite. However, it looks west. The second bedroom gets little light, as its aspect is blocked by the main bedroom.

Warning: On most floors, this apartment is blocked by the office building next door -- which is right up along side. This has a major negative impact on the second bedroom, and a negative aspect on the main bedroom. The second bedroom in the apartment that I saw had very minimal natural light and no view at all.

Type B Apartment Two bed, two bath (76 sqm internal and 10 sqm external - total of 86 sqm)

Not a large apartment, and about 5 sqm is hallway. Small kitchen. Small balcony. Bedrooms on each side of living room, and directly off living room (so less privacy). This apartment had a cramped feeling. So small that there was no room for a bath -- two showers but no bath. The views were good, South East down the South Bank river reach. It is best to be above level 15 or so, otherwise the Federal Court on the other side of the road may impact views, but not dramatically. Main bedroom was a good size with good views from large windows. Overall, too tiny.

B type apartment on 11th floor, 115, for sale at $760,000. This is way too expensive in my opinion for this apartment.

Type C Apartment Two bed, one bath (64 sqm internally plus 13 sqm balcony = total of 77 sqm)

There are two types of C type apartments, next door to each other. One is the mirror image of the other.

Surprisingly, I liked this apartment the best.

It is very small. There is no ensuite. There is a shower but no bath. The main bedroom is behind the 2nd bedroom and so has a small window and little light.

However, as soon as you walk in, you see the view. It looks South East down the South Bank river reach. It is a surprisingly good view from higher floors. However, you must be above level 15 or so, otherwise the Federal Court on the other side of the road will impact views dramatically. The balcony is a good shape and size. Not impacted by the Western sun.

Keep in mind that as the office building under construction at 402 George Street grows, these apartments will loose a lot of their city views. But this will not impact the river aspect.

C type apartment on 18th floor, 183, for sale at $650,000.

Type D Apartment One bed, one bath (53 sqm internal and 9 balcony - 62 sqm total)

Very small. Has Western aspect. No river views. Views mostly of Roma Street railway goods yards. No carpark included. Views will be impacted by proposed Meriton Tower on Herschel Street and office building being constructed on George Street. Kitchen is just a wall of cupboards. This apartment has no redeeming features at all.

D type apartment on 11th floor, 111, for sale at $414,000

There are a number of "sub-penthouse apartments" for sale as well. For example, apartment 344 on level 33 is a 2 floor apartment, 2 bedrooms upstairs and living kitchen downstairs. 144 sqm in total, so it is a good size, with a good aspect. However, the balcony is glassed in, so has a strange feeling. But the price -- $1,700,000 for a 2 bedroom apartment !!!

More details on the "sub-penthouse" apartments here.

Overall, this building has some nice apartments and some horrid apartments. It is ok for a short stay, for example, if you had to live here for 3 months. But I would not want to live any longer. The apartments with the good layouts and aspects are too small, and the larger apartments on higher floors are too too expensive. Many apartments have negatives -- too small, western aspect, built up against another building or poor layout. Over time, I suspect that this building will not live up to its promises and will become a place for students or short term stays only. I will avoid Evolution.

Prior posts on Evolution are here.

Skyline Falls

Skyline apartment, which is supposedly an exclusive residential building, is doing short tern and vacation rentals.

See Check-in.com.au or wotif.com

Not very good if you spend a million dollars on your apartment and you have the football team staying next door.

And for "hotel" guests, take care. This is not a hotel. The "reception" is open limited hours. Don't try to check in at reception Saturday afternoon or Sunday, and don't try to speak with anyone in management after hours either if something goes wrong in your apartment.

Empire Square - Residences

Floor plan for Westin Residences - Empire Square - at the top end of Elizabeth Street, Brisbane

Off-the-plan marketing techniques

Some interesting articles for developers regarding off the plan marketing. Useful for buyers to read, so you don't get tricked...

• The pricing process
• The display suite
• The website
• Branding

These are from the Residential Developer Magazine. (Distribution: For a list of newsagent stockists, click here. For a list of companies receiving the magazine via direct mail, click here.)

South Point at South Bank

Apartments and hotel rooms, at South Bank -- will be developed on the Collins Place site in Grey Street behind the Galleria.

Video

South Bank announcement

Photos

News report

Stanley Cove - South Bank

Concepts diagrams of Stanley Cover development at South Bank, which will be located in from of the Park Avenue apartment building, on the river:

http://www.southbankcorporation.com.au/about_us/stanley_cove_boardwalk_redevlopment

Brisbane Apartment Pipeline

As far as I can tell, these are off-the-plan apartment sales that will be launched this year in Brisbane (larger apartment developments only). I have put in bold those that are in the downtown area.

1. Trilogy Hotel - 192 apartments
   
2. Trilogy Skyhome Apartments - 109 apartments
   
3. Westin Residences (Empire Square) - 104 apartments
   
4. Waters Edge at West End - 220 apartments in the first 2 buildings to be released
   
5. Union at Milton - 213 residential apartments and 127 hotel rooms
   
6. French Quarter - about 70 apartments and 150 hotel rooms
7. Hamilton Harbour - about 250 apartments
   
8. Meriton Tower - 200 serviced apartments plus 200 residential apartments
9. The Mill at Albion
10. Waterfront Newstead - 631 apartments
    

Current off-the-plan buildings being marketed and under construction

1. Vision (400 apartments)
   
2. Iceworks at Paddington (47 apartments)
   
3. Parklands at Sherwood (82 apartments for sale now; 211 apartments planned in total)
   
4. Tennyson Reach (393 apartments)
   
5. SL8 (112 apartments)
   
6. Ciana Indooroopilly (132 apartments)
7. Portside Hamilton
8. Riverpoint West End (280 apartments)
   
9. The Macrossan (42 apartments)
   
10. SW1 (57 apartments)
11. Fresh Toowong (92 apartments)
    

Current completed buildings with unsold apartments

1. Skyline
2. M on Mary
3. Evolution
4. Koko
5. Tempo
6. Flow
7. Vue
8. Aurora Skyhomes
9. Pinnacle Parklands

From recent Collier's reports: "With three new projects bringing only 100 new units to the market in total, we now have our lowest unit supply since March 2004. Based on this quarter’s demand level of 104 units per month, we currently have enough stock in the market to last until May 2008."
"As a result the Dec 07 quarter has closed with 754 units available for sale, translating to 8.9 months of supply based on current demand levels. This supply is not evenly spread however, with the north precinct left with only 2.9 months of supply and the west with only 3.2 months, meaning if current demand levels remain constant both of these precincts will be completely sold out by the end of April 2008, unless new projects are released within these areas."
"Rental unit vacancy rate for Inner Brisbane sits at 1.3%, showing a considerably tighter rental market than the remainder of Brisbane which shows a rental vacancy rate of 2.2%."
See, e..g., http://www.colliersresidential.com/files/research/brisunitreport_dec07.pdf

Union Development - Milton Railway Station

From the FKP website:

http://www.unionmilton.com.au/

"Union is proposed to incorporate:

• 30-storey residential building comprising 213 – one, two and three bedroom apartments
• 127 room, 4.5 star hotel
• 10-storey office building comprising 13,500 sqm of net lettable floor space
• Prime podium and street frontage retail
• Multi-million dollar Milton Railway Station upgrade."

"Views to the river. Views to the city. View to the hills. Bring your worlds into Union.

Unrivalled 360 degree views of Brisbane and beyond will be the focal point of Union’s proposed 30-storey residential building. As a stunning and sleek landmark in Milton, Union will offer a location free from the clutter of neighbouring buildings.

Residential opportunities at Union are proposed to commence from Level 8 and will comprise an array of architecturally sophisticated options, including:

• proposed terrace apartments overlooking Railway Terrace
• proposed one bedroom apartments up to Level 22, and a variety of two and three bedroom apartments with a bird eye views of Brisbane up to Level 30.

For those seeking the pinnacle in residential apartment living – a limited number of two storey, three bedroom apartments are also proposed."

Allisee Development

First, Stockland sold its Saville hotel and apartment development to MFS/Stella, who have rebranded Saville as Mantra.

Next, Stockland has had a hard time selling its Koko development on the river at West End. It has reduced prices of the highend stock.

Now, Stockland is abandoning its Allisee development on the Broadwater on the Gold Coast. An advertisement in Thursday's AFR states that Stockland is selling Stage 3 of Allisee in one line -- total area of 8,679sqm over 3 sites. (The advertisement also states that Stage 1 is complete and 80% sold, and Stage 2 is underdevelopment with 30% sold.)

Losses at Devine's Festival Towers

As far as I can tell, many early off-the-plan purchasers of apartments at Devine's Festival Towers at 108 Albert Street, Brisbane have made no money (or losses) on resales, particularly if you take into account stamp duty and agents fees.

Some examples:

• Apt 3601, purchased off-the-plan in April 2004 for $468,000, resold in October 2007 for $495,000
• Apt 3209, purchased off-the-plan in September 2003 for $491,000, resold in May 2007 for $505,000
• Apt 3201, purchased off-the-plan in September 2003 for $457,000, resold in July 2007 for $460,800
• Apt 3109, purchased off-the-plan in September 2003 for $483,000, resold in October 2007 for $475,000
• Apt 3101, purchased off-the-plan in September 2003 for $455,000, resold in March 2007 for $415,000
• Apt 3003, purchased off-the-plan in September 2003 for $414,000, resold in October 2007 for $435,000
• Apt 2903, purchased off-the-plan in October 2003 for $380,000, resold in October 2007 for $418,000.
• Apt 2902, purchased off-the-plan in September 2003 for $440,000, resold in October 2007 for $485,000
• Apt 2601, purchased off-the-plan in October 2003 for $441,000, resold in November 2007 for $460,000
• Apt 2501, purchased off-the-plan in October 2003 for $443,000, resold in February 2007 for $440,000
• Apt 2403, purchased off-the-plan in November 2003 for $369,000, resold in November 2007 for $435,000
• Apt 2303, purchased off-the-plan in September 2003 for $365,000, resold in June 2007 for $389,000
• Apt 2505, purchased off-the-plan in November 2003 for $301,000, resold in April 2007 for $294,500
• Apt 2404, purchased off-the-plan in September 2003 for $293,000, resold in November 2007 for $323,000
• Apt 2105, purchased off-the-plan in September 2003 for $296,000, resold in October 2007 for $310,000
• Apt 2006, purchased off-the-plan in September 2003 for $300,000, resold in October 2007 for $305,000
• Apt 1706, purchased off-the-plan in October 2003 for $296,000, resold in September 2007 for $305,000
• Apt 1501, purchased off-the-plan in October 2003 for $407,000, resold in April 2007 for $417,000
• Apt 608, purchased off-the-plan in February 2004 for $398,000, resold in October 2007 for $410,000

So take care when purchasing off-the-plan. Not everyone makes money. And with M on Mary and the proposed Empire Square blocking views from Festival Towers, it could get worse rather than better over time for some owners.

Vision

"Vision has captured the imagination of Brisbane and has proved enormously popular with sales now at $250 million, with 70% of apartments already sold," Mr Chappell said.

"The pre-sales of apartments and the recent commercial sale shows the strength of the Brisbane market and confirms an enthusiastic acceptance of the project among future residents and investors."

See: http://blueprint.austcorp.com.au/edition-07/vision.html

New Apartment Prices in Brisbane

1. Trilogy Hotel Rooms (studios & two bedrooms)

• levels 36 to 47
• 16 apartments per floor
• sold fully furnished with 2 year rent guarantee
• hotel managed by Mirvac
• sizes range from 53 sqm to 89 sqm
• no balcony
• 3 elevators
  
• about half will have river views
• most do not have car parking
• completion about 2012
  

Average price per apartment on level 36: $639,000
Average price per square metre on level 36: $9,785

Average price per apartment on level 47: $695,000
Average price per square metre on level 47: $10,630

2. Empire Square (two and three bedrooms)

• levels 47 to 60
• 7 apartments per floor
• sold unfurnished
• hotel managed by Westin
• sizes range from 117 sqm to 150 sqm
• no balcony
• 5 elevators plus service elevator
• about half will have river views
• 1 or 2 car parks per apartment
• completion about 2012
  

Average price per apartment on level 47: $1,502,857
Average price per square metre on level 47: $11,336

3. Aurora Skyhome

• levels 64 to 65
  
• 5 apartments per floor
• sold unfurnished
• managed by Oaks
• 2 and 3 bed apartments
• four with river views
• 2 car parks per apartment
• completed in 2006
• Last year, apartment 643 on level 64 was listed at $1,095,000. 2 bed, 2 bath, 2 cars, 102 sqm internal, 125 sqm total, $8,760 per sqm metre

4. Pinnacle Parklands

• levels 4 to 12
• 5 apartments per floor
• range of sizes
• No river views - views of Roma Street Parklands
• completed 2007
  
• Last year, a 3 bed/2 bath/media room/3 car park display apartment about level 5 was being sold furnished at $1,675,000. 184 sqm internal, 257 sqm total, $6,517 per sqm.
  

5. Tennyson Reach

• five buildings, each around 10 floors
• some floors have 8 apartments, some 2 apartments
• range of sizes
• almost all have river views
• to be completed in about 2010
• about 1 elevator per 3 apartments per floor

Examples

• 2 bed, 2 bath, 111 sqm internal, 141 sqm total, 5th floor, $910,000 ($6,453 per sqm)
• 3 bed, 2 bath, 192 sqm internal, 227 sqm total, 4th floor, $1,320,000 ($5,814 per sqm)
• 3 bed, 2 bath, 189 sqm internal, 235 sqm total, 5th floor, $1,475,000 ($6,276 per sqm)

Water's Edge at West End

For a photo of the proposed development, see this Vox site.

104 Apartments for Bardon

First, there was Roma Street Parklands. Then Sherwood Parklands. My guess is that next, the Pradella Construction Group will launch Bardon Parklands. Pradella owns the Bardon Conference Centre.

"Brisbane City Council is assessing an application by the Pradella Group to rezone the 3.4ha site from a community purpose and conservation area for redevelopment. The proposal, lodged with the council in September 2006, features four three-storey buildings to house 104 apartments and 20 attached units, with 248 car parks."

See

http://mountcoot-tha.greens.org.au/media-centre/interviews/centre-rezone-ask-for-units

http://www.thebardoncentre.com.au/assets/bardon-map.pdf

http://www.pradella.com.au/web/pdf/news_2007_issue1.pdf

http://www.pradella.com.au/content/news/press_display.asp?id=141

Would you live in Charlotte Towers?

I visited Charlotte Towers recently. It was built and sold by Devine as an apartment building, and sold as "residential apartments". However, it is now an Oaks Hotel. There are still some people living here on a full time basis. But it is not nice. Four things that I saw on my visit:

• room service plates and trays left in the hall
• cleaners with trolleys blocking halls and elevators
• a hotel guest who was very frustrated, who had a bad check in experience, and could not find her way to her "room" - she took her frustrations out on me
• the driveway to the car park blocked with people trying to check in -- there were four cars trying to get in and two cars trying to get out -- but it was blocked by a car of guests checking in.

An agent said that it was better now, as the facilities got less use -- before Oaks, there were many students in the building, often illegally overcrowding apartments. Oaks, he said, is now focusing on short stays for executives. The agent said that Oaks had over 90% occupancy during the week.

Online, I could reserve a one bedroom apartment for $150 a night.

RP Data Report

RP Data reports that Brisbane Apartment prices increased about 28% last year. Growth, however, is slowing.

See http://apr.cpmresearch.com.au/apr/Portals/0/MR290208.pdf

This valuer's report is also interesting.

Brisbane Westin

The Empire Square development is now in pre-sales. It is called The Residences at the Brisbane Westin Empire Square.

"The building area will be approximately 85,000m2. It is designed to be 250 metres high with 68 storeys and 62 habitable floor levels. Currently there are only 2 other buildings in the Brisbane CBD of comparable height.

The building architects Cottee Parker Architects Pty Ltd have designed an iconic structure which will be a signature building in Brisbane, with an ultra-modern tower and timeless qualities adding to the elegance of the city skyline.

Internally, the design aims to create a pleasing and peaceful ambiance in keeping with the elegance of the structure, whilst providing modern and practical solutions.

The development will be located on a land area of almost 2,000m2 at the upper end and southwest side of Elizabeth Street Brisbane.

The building will also feature 23 floors of "A grade" office space from levels 5 to 27. The office section will have a separate foyer and dedicated lift bank.

The building will also incorporate 104 strata titled residential apartments over 16 floors from floor 47 to 62. The current proposal is to integrate the apartments within the ´5 Star Hotel´. Through the integration concept, the apartments will be complementary to the Hotel and benefit from a wide range of premium facilities offered by the Hotel including; swimming pool, gymnasium, sauna, steam bath, relaxation lounge, food and beverage, house-keeping and laundry services.

The development will provide a range of accommodation choices from two bedroom apartments (some with study) to three bedroom sky homes and double storey penthouses. Prices start at $1,300,000.

The Hotel will occupy 20 levels of hotel rooms and facilities, which will incorporate 306 luxury hotel rooms and suites, including a presidential suite overlooking South Bank.

Level 30 will feature the hotel´s recreational facilities including pool, his & hers gyms, beauty centre and day spa. Meeting rooms and a business centre will also be available to guests.

Bar and dining facilities will be available on the mezzanine levels."

Trilogy Tower

Trilogy Tower, 480 Queen Street Brisbane

"Pre-release: VIP Appointments commence this Sunday 16th March. Official launch Saturday 19th April. 25 sales logged in 48 hours."

My summary (more details to follow): Hotel apartments - managed by Mirvac. Floors 36 to 47. There are 16 apartments per floor - six are 2 bedroom and ten are one bedroom. Price ranges: 1 bedroom - $480,000 to $595,000; 2 bedroom - $710,000 to $990,000. Sizes - 1 bedroom - 53sqm to 59 sqm; 2 bedroom - 70 sqm to 89 sqm. No balconies. Due for completion in 2012.

"Trilogy Tower is a 70 storey multi-use tower that derives its name from the three integrated environments contained within its spectacular steel and glass facade - office space, living space and hotel space. With its gaze firmly fixed on success, Trilogy Tower will become a centrepiece for Brisbane's future workforce, short stay visitors and permanent residents.

The $650 million to come to life on the site known as the Red Cross building, has been approved to 250m high, but will climb much higher once the City’s height limit is removed under the new CBD Masterplan. The state-of-the-art ultra-highrise tower will also contain the Brisbane CBD’s first new 5-star apartment hotel project in more than a decade.

The residential apartments will offer living areas from 85 sqm through to double-storey sky-homes of up to 350 sqm. Permanent residents at the top of the building will enjoy design, finishes and amenity rarely seen before in Australia.

The 5-star hotel accommodation component of the building comprises one and two-bedroom apartments of up to 100 sq m in living area. APH has signed a heads of agreement with a soon to be announced 5-star operator after fielding inquiry from a dozen or more local and international hotel management groups.

This iconic development will deliver the next generation of technology and sustainable design with first class accommodation facilities for office workers, short-term visitors to Brisbane and permanent residents as well as unparalleled and uninterrupted views of the Brisbane River, the Story Bridge and greater Brisbane,” said APH Managing Director John Wilson.

“The residential buildings we see around the CBD now are a part of the first generation of CBD living in Brisbane,” Mr Wilson said. “This new tower will meet the standards of a market that won’t be moving in until 2011, so it has to be beyond the forefront of design innovation."

French Quarter in Alice Street

From the Devine website, which shows that three towers are planned:

"Devine Limited has recently obtained control of a 7,252sqm parcel of land in the Brisbane CBD directly opposite the Botanic Gardens."

"A circa 54 storey high-rise development incorporating a 120 - 150 room 6 star boutique hotel approximately with circa 70 first class residential units ranging in size from 250 - 800sqm gross and valued at between $3 million to $15 million each. The development is located on the corner of Alice and Albert Streets opposite the Brisbane Botanical Gardens.

Projects Status:
The building is currently in the initial schematic design and we have run an international design competition which we believe will produce a visionary landmark design. Submissions have already been received from some of Europe’s finest architects. We have also run an international tender seeking expressions of interest from leading hotel operator-managers and have 12 responses from national and internationally renowned organisations in the field.

Some of those include:
The Park Hyatt
Intercontinental
The Regent
Conrad Hilton
Shangrila
Mirvac
TAJ

A development application will be lodged over the site once the new Brisbane City Neighbourhood plan has been adopted in 2008."

Drawings

Promotional Video: Click http://www.youtube.com/watch?v=q_ECTk24lxg to see Devine's proposal.

Hamilton Harbour - Over 200 Apartments Planned

From Devine's website:

PROJECT SIZE

•Mixed-use development comprising approximately 250 apartments, 30,000m2 commercial office space and 1500m2 retail space.

PROGRAM

•A preliminary development application was lodged over the site in January 2007, which is currently being processed by Brisbane City Council and is anticipated to be approved in early 2008.

PROJECT END VALUE

•$400 million

ANTICIPATED COMPLETION DATE

•FY 2011 (stage development)

ANTICIPATED CONSTRUCTION START DATE

•Last quarter 2008

Drawings

REIQ Apartment Price Report for Brisbane

REIQ Unit Report - see http://www.brisbanetimes.com.au/media/prices.pdf

Brisbane City - medium price is $469,000 for December 2007 quarter, which is a 8.7% change of the quarter. A number of suburbs have a higher medium price.

From the Brisbane Times this week:

The median sale price of units and townhouses in the inner-city suburb of Milton almost doubled last year, beating growth seen in Hamilton and New Farm.

A suburb known for its student population, proximity to a brewery and a miniature Eiffel Tower, Milton left other city hotspots for dead in 2007. ...

A scarcity of potential development sites in the inner-city area had seen Milton placed "in the firing line" of developers because of its location, he said.

As a result, industrial and commercial lots in the suburb could soon be replaced with new apartment projects, he said.

Units in Milton represent almost 39 per cent of all dwellings, with a higher proportion of older properties built between the 1960s and 1990s.

"The median unit price since 2004 has experienced significant fluctuations, particularly when new apartment stock dominates the total number of transactions," Mr Rivera said.

Prices in the area had performed "exceptionally well" lately thanks to the introduction of high-rise apartments, which achieved a much higher price than mature unit stock, he said.

Planned developments in the area confirmed Milton as a "strategic location" for residents and businesses, as it was likely to bring new infrastructure and improve liveability.

One such project is FKP's Union Milton development situated above the train station, and is proposed to include a 30-storey residential building of 214 apartments.

Along with the residential component, the developer plans to include a hotel and 10-storey office space.

While there was a drop in sales in the December quarter, Mr McGrath said investors would likely return to the market as yields improved over the course of 2008.

Brisbane Auction Results for early March 2008

From APM Home Price Guide Newsletter:

In Brisbane this week 171 properties were auctioned and the clearance rate was 41%. Last week, 102 properties went to auction and the clearance rate was 47%. During this week of last year 46 properties went to auction with 59% selling at auction or prior.

17 properties were auctioned this week on the Gold Coast and the clearance rate was 20%. Last week 49 properties were auctioned with 22% selling at auction or prior. During this week last year the clearance rate was 58%.

• Aurora, 420 Queen Street - Apartment 336 (6th Floor) 2 bed, 2 bath, 1 car, reasonable river views - not sold - highest bid $535,000

For the week ending 8 March, auction results for apartments in Brisbane were not good.

At a midweek Ray White auction, there was good attendance. But mostly people watching the market. There were few active buyers.

Results of the midweek Ray White Auction

Charlotte Towers (128 Charlotte Street, Brisbane)

Apartment 3801 - Level 38 - 1 bed plus study - 57 sqm - no car park - sold at auction for $320,000
Apartment 3105 - Level 31 - 1 bed with big storage room - 60 sqm - no car park - not sold
Apartment 2410 - Level 24 - 1 bed with large shower - 61 sqm - no car park - sold at auction for $310,000

[I suspect the above sales were below the original purchase price, so the seller made a loss.]

212 Margaret Street
Apartment 1504 - not sold

River Park Central (120 Mary Street)
Apartment 602 - 2 bed, 2 bath, 1 car - 85 sqm - not sold at auction - now listed for $420,000

Saturday Auction (Brisbane clearance rates were a low 44%; national clearance rates

Elysees (15 Walsh Street, Milton)
Apt 33, Penthouse - 3 bed, 2 bath, 2 car - no bids at auction - now listed for $969,000

15 February Ray White Auction

Tempo (West End)
75/20 Donkin Street, 3 bed, 2 bath, 2 car - not sold - vendor bid of $800,000 - still listed for sale.

Evolution Discounted

Received in the email today:

"... the developer is offering a limited offer to all purchasers of 2bed, 2bath, 1car and 2bed, 1bath, 1car apartments in Evolution as a part of our Grand Opening.

A type Apartments 2bed, 2bath, 1car apartments

• 1 year, 5% rental guarantee
• $50,000 rebate to purchaser at settlement

C type Apartments 2bed, 1bath, 1car apartments

• 1 year, 6% rental guarantee
• $30,000 rebate to purchaser at settlement

This offer valid for sales where the SAF is received by 31 March and the contract is unconditional on or before 14 April, 2008."

I guess this means that Evolution was overpriced or is not selling well or the developer is worried about a market downturn.

St George Bank's Prediction regarding housing price growth

Despite the healthy state of the Australian economy, with positive terms of trade helping to boost incomes and household spending power, uncertain financial conditions may limit any benefits for property growth.

St George says that, on balance, it's unlikely that the residential housing market will remain unharmed.

"For this reason, despite fundamentals such as lower vacancy rates and higher population growth rates, we have downgraded our forecasts for average house prices," chief economist Steven Milch says in the latest property market update.

Australian house price growth is now expected to be between 5 and 10 per cent over the next year, with Perth the only possible exception - possibly below the 5 per cent mark.

"It should be noted, however, that a cooling in Melbourne, Brisbane and Adelaide (where prices increased by a minimum of 18 per cent over the past 12 months) might actually assist in avoiding a boom-bust cycle," Mr Milch says.

The bank says history shows the last five housing cycles lasted for an average of five years from base to peak.

"The trough of the current cycle was end-2004 so the possible timing of the next peak is end-2009," Mr Milch says.

See news.com.au

Bardon Parklands - 104 apartments planned

First, there was Roma Street Parklands. Then Sherwood Parklands. My guess is that next, the Pradella Construction Group will launch Bardon Parklands. Pradella owns the Bardon Conference Centre.

"Brisbane City Council is assessing an application by the Pradella Group to rezone the 3.4ha site from a community purpose and conservation area for redevelopment. The proposal, lodged with the council in September 2006, features four three-storey buildings to house 104 apartments and 20 attached units, with 248 car parks."

See

http://mountcoot-tha.greens.org.au/media-centre/interviews/centre-rezone-ask-for-units

http://www.thebardoncentre.com.au/assets/bardon-map.pdf

http://www.pradella.com.au/web/pdf/news_2007_issue1.pdf

http://www.pradella.com.au/content/news/press_display.asp?id=141

Brisbane Apartment Market is Hot

Extract from SMH (Full article) March 4, 2008

According to BIS Shrapnel forecasts, Brisbane is projected to show the best growth over the next three years and by 2010 will have the leading long-term growth average of Australia's capital cities.

While preferring not to elect individual suburbs as growth hot spots, BIS Shrapnel senior economist Jason Anderson says the imbalance between supply and demand in Brisbane is set to affect apartment prices. Anderson believes the capital will soon face a dire shortage of apartments, especially for renters.

"[The imbalance is] going to get even worse in the inner-ring suburbs ... so in that sense there's a leaning towards that end of the market - particularly if you're looking at the volume of demand, which will rise substantially as new office developments are completed in 2009 and 2010."

...

Most people buying an apartment within Brisbane aspire to purchase within the inner city or areas near the city, Lawless says. He believes these areas provide the highest level of amenity, such as shopping, restaurants, nightclubs and cafes.

Both Lawless and McNamara believe the city will offer good returns in the medium term. "Essentially, it's important to be close to the CBD - and where apartments overlook the river and are close to the city you'll probably have good capital growth," McNamara says.

"Brisbane is starting to become expensive and many Gen Ys are going to be looking to rent in quality apartments in the city where the action is, as opposed to buying, because property prices where they want to live are somewhat out of their reach."

...

SUNSHINE COAST

McNamara says Noosa Heads is "the signature place - the place to be on the Sunshine Coast" and believes that of all the areas in the region, this is the one where strong demand will continue.

Noosa's median apartment price rose from $500,000 in 2006 to $549,000 last year. McNamara also likes Mooloolaba, which has a thriving local economy and attracts many holiday-makers. Median prices rose from $355,000 in 2006 to $375,000 last year.

Skyline - How much is unsold?

From Ariadne's report to the ASX dated 27 February 2008:

The 192 unit Skyline project was completed in October 2007. As at 31 December 2007, the project was 65% settled. Currently, 24 units remain to be sold.

Ariadne expects a degree of volatility in the SEQ property market over the next 12 months.

(On 13 November 2007, Ariadne reported that the Skyline project was 80% sold and that settlement was expected on the week starting 26 November 2007.)

Why, if it was 80% sold as at November, was it only 65% settled as at the end of December? Did 15% of the sales fail to settle? Or are these insider sales with delayed settlement?

Waterfront Newstead

Mirvac's first mailout for their Waterfront project at Newstead has taken place.

Construction of the sales centre on Evelyn Street is underway.

Mirvac plans to release two buildings with the Pier area in the first half of this year.

The website at www.mirvac.com.au/waterfrontnewstead/ states one building will be 5 storeys and the other will be 8 storeys, and will comprise premium 3 and 4 bedroom apartments.

There will be a lake, a 6 hectare park, and a total of 650 apartments across all buildings when complete in 2015 -2017.

Demand for Brisbane Apartments Set to Rise

Extracts from the SMH. (Full article) March 4, 2008

"The coast may be fashionable but Brisbane remains the most popular location for interstate migrants, attracting the largest proportion of Sydneysiders ready to call Queensland home.
...

The growth in employment has affected housing supplies, says senior BIS Shrapnel economist Jason Anderson.

"There has been a huge amount of employment growth in south-east Queensland, particularly in office markets," Anderson says. "Vacancy rates in Brisbane are negligible and there has been a lot of office construction. Sites once mooted for residential use are snapped up for offices."

As a result, Anderson says, there is little new apartment construction happening and supply is very constrained.

"Office construction is going to draw a lot of people into the CBD for work, and demand for accommodation in inner-ring suburbs is going to increase sharply over the next two years," he says. "There are not going to be enough new apartments for them to occupy."

He says this situation means the outlook for inner-Brisbane apartments is positive. He also predicts a perception shift in the value of apartments in the middle and outer suburbs.

"We'll see more construction and acceptance of the value of having new apartments in middle and outer-ring suburbs close to transport infrastructure," he says. "There's not going to be enough rental housing in the inner ring, so demand will spill into the middle ring. This will change people's expectations of returns over the next two to three years."

...

"The recent stockmarket jitters might see more investors returning to the 'tried and true' property market," Timchur says. "With so many new unit projects about to launch in the Brisbane market, developers will need to keep their fingers on the pulse and make sure they are providing what the market wants.

"Things are going to get competitive this year."

PRICES SOAR FOR NEW UNITS

The average price of a new unit within five kilometres of the Brisbane CBD rose from $597,000 in June last year to $725,417 in December, an increase of 21.5 per cent.

The figures were released by Colliers International Brisbane research analyst, Alison Timchur, who reports there are at least 10 big projects due to hit the Brisbane market this year.

These 10 developments account for more than 2400 units, with a building cost of $2.8 billion. More than 50 per cent are expected to be two-bed units, with a further 35 per cent one-bedders.

Timchur says this highlights how developers have been guided by market activity last year to determine current and emerging living trends, and are planning new developments to cater for the expanding single and couple inner-city market, which has dominated the Brisbane marketplace during the past year.

"One thing we may expect to see in 2008 is the continued escalation of new unit prices, driven by factors such as increased demand, larger living spaces and the increasing popularity of inner-city apartments for owner-occupiers and investors alike," she says.

THE ONLY WAY IS UP

· A PRDnationwide Brisbane unit report shows 2007 was a turnaround year for Brisbane's new apartment market.

· After the slowest year in more than a decade, there was an upswing of activity in new unit sales last year.

· During the year, $732 million of new apartments were bought and sold in inner Brisbane (a total of 1065 units).

· The average price of a new unit in inner Brisbane during last year was $687,000.

Not A Good Week for Auctions in Brisbane

This week (ending 8 March), auction results for apartments in Brisbane were not good.

At a midweek Ray White auction, there was good attendance. But mostly people watching the market. There were few active buyers.

Results of the midweek Ray White Auction

Charlotte Towers (128 Charlotte Street, Brisbane)

Apartment 3801 - Level 38 - 1 bed plus study - 57 sqm - no car park - sold at auction for $320,000
Apartment 3105 - Level 31 - 1 bed with big storage room - 60 sqm - no car park - not sold
Apartment 2410 - Level 24 - 1 bed with large shower - 61 sqm - no car park - sold at auction for $310,000

212 Margaret Street
Apartment 1504 - not sold

River Park Central (120 Mary Street)
Apartment 602 - 2 bed, 2 bath, 1 car - 85 sqm - not sold at auction - now listed for $420,000

Saturday Auction (Brisbane clearance rates were a low 44%; national clearance rates

Elysees (15 Walsh Street, Milton)
Apt 33, Penthouse - 3 bed, 2 bath, 2 car - no bids at auction - now listed for $969,000

15 February Ray White Auction

Tempo (West End)
75/20 Donkin Street, 3 bed, 2 bath, 2 car - not sold - vendor bid of $800,000 - still listed for sale.

Other recent sales in Brisbane:

• River Place, 1 bedroom with river view - Unit Type N (about 62 sqm including balcony) - no car park - Apt 116 - $370,000
• Charlotte Towers, 2 bedrooms, 1 bath, 1 car - 27th floor - apartment 2703, 82sqm total including alfresco dining area - $461,000
• Aurora - 2 bed, 2 bath, 1 car, Apt 301, 107 sqm including balcony, listed at $600,000, sold for $570,000
• Festival Towers, 2 bed, 2 bath, 1 car, Apt 1208, listed at $428,000, sold for $415,000 (one of the best floor plans in Festival Towers, 83 sqm plus small 3 sqm balcony, but now has no view as it looks into M on Mary).

Average price per sqm for these four recent sales (including balcony area) is $5,427. Festival and Charlotte are B minus buildings, Aurora is a B building, and River Place a B plus (due to location).