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Linton Apartments - Kangaroo PointINVESTMENT OPPOR TUNIT Y ANALYSIS
The information outlined within this document represents a subjective interpretation of the development based on plans, pricing and other information provided to us by the developer
and/or their representatives. This information should not be relied upon for investment decisions. Interested parties should undertake independent inquiries and investigations to satisfy
themselves that any details herein are true and correct. No forecasts are being made by Resolution Research & Marketing Pty Ltd about potential capital gains. Past information contained
within this document about capital gains or price growth does not imply that such gains or growth will be made in the future. Resolution Research & Marketing Pty Ltd accepts no
responsibility for reliance on this information. This information is current for twelve months from June 2015.
DATE: JUNE 2015
BRISBANE OVERVIEW &POPULATION
3INVESTMENT OPPORTUNITY ANALYSIS
BRISBANE OVERVIEW
Located on the eastern seaboard of Australia,
Brisbane enjoys the closest proximity to Asia than
any other Australia capital city. Consequently trade,
investment, cultural and tourism links between Asia
and Brisbane are the strongest in Australia.
Brisbane offers its residents an enviable life with a
climate which affords its population a unique, year
round alfresco lifestyle.
The city is one of the fastest-growing regions in
Australian and the third most populous city in
Australia. Brisbane is the largest of Australia’s six
capital cities by geographic area and the third
largest in the world. The region is set to continue
to be one of Australia’s fastest-growing with the
Queensland Government forecasting Brisbane’s
population to grow from 2.1 million to nearly 3
million by 2031.
Much of Brisbane’s population growth is driven
by overseas and interstate migration which are
both key factors which have, and will continue to,
underpin demand for new dwellings throughout the
city.
Brisbane has an extensive public transport network
of buses, trains, CityCats and ferries that connect
all corners of the city and key community spots.
Quality rail infrastructure provides commuters
with access to a network of 10 lines, more than
130 stations, and direct links to key destinations
including the city heart, the Brisbane Convention &
Exhibition Centre and South Bank. With 400 bus
routes, more than 12,600 stops, a modern fleet of
buses and several dedicated busways, Brisbane’s
bus network forms an essential component of the
city’s public transport infrastructure mix.
Brisbane City Council has delivered several
important infrastructure projects in recent years,
including the Clem Jones Tunnel, Go Between
Bridge and Airport Link. The Legacy Way Tunnel
will open in June 2015 and will be the next
major infrastructure project to be completed.
Collectively, these projects represent one of the
largest infrastructure initiatives ever undertaken in
Australia. This significant investment has ensured
that the area’s rapidly growing population base
have sufficient infrastructure in place to support
access to the city’s major employment, education
and retail nodes.
BRISBANE OFFERS ITS RESIDENTS AN ENVIABLE LIFE WITH A CLIMATE WHICH AFFORDS ITS POPULATION A UNIQUE, YEAR ROUND ALFRESCO LIFESTYLE.
ONE OF AUSTRALIA’SFASTEST
GROWING REGIONS
POPULATIONTO GROW FROM2.1 MILLION TO
3 MILLION
BRISBANE APARTMENT MARKET OVERVIEW
5INVESTMENT OPPORTUNITY ANALYSIS
BRISBANE APARTMENT MARKET
AFFORDABILITYThe latest data provided by the Real Estate
Institute of Australia shows that as at the March
Quarter 2015, Brisbane ranked as the second most
affordable apartment market in Australia with a
median price of $385,0001.
According to this data, Brisbane’s median
apartment price is $98,300 lower than the national
median.
When compared with Sydney’s median apartment
values, Brisbane apartments are $162,100 cheaper
and $114,000 lower than Melbourne’s median.
The affordable position of Brisbane apartments
is a key driver underpinning increasing levels of
interstate migration which is resulting in uplifts in
demand for apartments within Brisbane.
With a continuation of escalating demand, growth
in median values will follow suit with the Brisbane
median expected to climb to the $400,000 mark
by December quarter 2015.
1 Real Estate Institute of Australia – June 2015
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$-
HOBART BRISBANE CANBERRA ADELAIDE PERTH AUSTRALIA MELBOURNE DARWIN SYDNEY
$277,000
$385,000
$424,000$445,000 $445,000
$483,300$499,000
$525,000
$547,100
Source: Resolution Research Real Estate Institute of Australia – June 2015
AUSTRALIAN CAPITAL CITIES – MEDIAN UNIT PRICES – MARCH QUARTER 2015
MOSTAFFORDABLE
MARKET INAUSTRALIA
#2
BRISBANE INNER CITY APARTMENT MARKET
7INVESTMENT OPPORTUNITY ANALYSIS
BRISBANE INNER CITY APARTMENT MARKET
Brisbane’s inner city apartment market is
comprised of 21 suburbs which sit within a
5-kilometre ring of the CBD.
Across the past two years we have seen a
large volume of new development completions
throughout the inner city which are servicing the
long term underlying demand for new dwellings
in inner urban locations. Our analysis of the
current future supply landscape across Brisbane’s
inner city indicates that, based on the long term
demand performance of the market, the market
remains in a state of undersupply.
Brisbane’s inner city apartment market currently
occupies an opportune position on the property
clock, sitting at 7 o’clock. The market has
entered its next growth phase with underlying
fundamentals in place for a continuation of
improving levels of demand in the face of what
remains an undersupplied market. Opportunities
to capitalise on the market’s upswing are apparent
across both underlying values and rental returns.
Inner City Residential Apartment Market Property
Clock – Sydney vs. Melbourne vs. Brisbane
Over the ten years to March 2015, the median
apartment price across the inner city has grown by
an average of 2.9% per annum to reach a median
value of $477,000. Over the medium term (5
years) growth in median values across Brisbane’s
inner city have performed largely in line with the
long term averaging at 2.6% per annum.
OUR ANALYSIS OF THE CURRENT FUTURE SUPPLY LANDSCAPE ACROSS BRISBANE’S INNER CITY INDICATES THAT, BASED ON THE LONG TERM DEMAND PERFORMANCE OF THE MARKET, THE MARKET REMAINS IN A STATE OF UNDERSUPPLY.
INNER CITY RESIDENTIAL APARTMENT MARKET PROPERTY CLOCK – SYDNEY VS.
MELBOURNE VS. BRISBANE
INVESTMENT OPPORTUNITY ANALYSIS8
$600,000
$500,000
$400,000
$300,000
$200,000
$100,000
$-2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
6,000
5,000
4,000
3,000
2,000
1,000
-
Sales Volumes Median price
Source: Resolution Research, State of Queensland – June 2015
BRISBANE INNER CITY APARTMENT MARKET PERFORMANCE – MAR 2006 TO MAR 2015
Both long term (10 year) and short term (5 year)
demand has remained relatively stable at 3,800
and 3,400 apartments respectively. During
the market’s peaks in 2007 sales volumes rose
to sit at 5,100 in line with introductions of new
apartment developments into the inner city
clearly demonstrating the market’s capacity and
willingness to absorb new apartment supply as it
enters the market.
Substantial rises in median price corresponded
with this lift in demand with an annual growth rate
of 11.8% recorded between 2006 and 2007. This
solid growth is demonstrative of a market, which
has a strong acceptance of values attributable to
new product as it is injected into the market place.
More recently, over the 12 months to March 2015
the median apartment price across Brisbane’s
inner city recorded an increase that was higher
than both the long and median term averages at
3.6%.
VALUES UP2.9% P.A
VALUES UP3.6%
IN THE PASTYEAR
BRISBANE INNER CITY DEMOGRAPHICS
INVESTMENT OPPORTUNITY ANALYSIS
BRISBANE INNER CITY2 DEMOGRAPHICS
Around one third of all residents of Brisbane’s
inner city are aged between 20 and 35 years
of age, which is significantly higher than that
recorded across Queensland. This demographic
trend is consistent with all inner urban markets
whose populations are predominantly comprised
of Gen Y and Gen X residents who have a strong
lure towards the lifestyle and convenience on offer
in high-density, mixed use locations within close
proximity to major employment nodes.
It follows suit then, that the dwelling landscape
throughout Brisbane’s inner city is dominated by
apartments, which account for almost half of all
dwelling types located throughout the inner city,
which is more than four times the proportion of
apartments recorded throughout Queensland.
Given the popularity of Brisbane’s inner city with
younger residents, the proportion of households
occupied by couples with children is lower than
the Queensland trend at the expense of higher
instances of dwellings occupied by lone persons
and share households.
Consistent with this is a preeminence of smaller
dwelling types comprised of one and two
bedrooms. These dwelling types account for
46.5% of all dwellings throughout the inner
city which is more than double that recorded
throughout the State.
Support for this type of built form and
accommodation is strong across all tenure types,
particularly the rental market which account for
almost half of all occupied households in the area.
At the time of the 2011 Census, more than half of
the inner city’s working population were employed
in a professional or managerial capacity, which is
significantly higher than that recorded throughout
Queensland of 31%.
Following on from this occupational profile
is a typically affluent population earning
higher median weekly incomes on personal,
household and family levels when compared with
Queensland. At the time of the 2011 Census, the
median weekly family income of Brisbane’s inner
city residential population was $270 per week
higher; the median weekly personal income was
$890 per week higher; and the median weekly
household income was recorded as $530 per week
higher.
Reflective of an area populated by those working
in high income occupations is a population paying
more for housing costs. Median weekly rents, at
the time of the 2011 Census were $175 per week
higher than the Queensland and median monthly
mortgage repayments were $1,300 per month
higher.
2 Brisbane Inner City – SA4
POPULAR GEN YADDRESS
10
YOUNGAFFLUENT
POPULATION
BRISBANE’S INNER CITY IS DOMINATED BY APARTMENTS, WHICH ACCOUNT FOR ALMOST HALF OF ALL DWELLING TYPES LOCATED THROUGHOUT THE INNER CITY.
KANGAROO POINT LOCATIONAL ANALYSIS
INVESTMENT OPPORTUNITY ANALYSIS12
B=Kangaroo Point is located less than 2 kilometres
from the Brisbane CBD and occupies a prime
position on a peninsula around which the Brisbane
River flows. The geographic attributes of the
suburb offer a range of river and city views
unmatched in Brisbane. It is traversed by the iconic
Story Bridge and home to one of Brisbane’s most
revered natural assets – the Kangaroo Point Cliffs.
RECREATIONAL & LIFESTYLE AMENITY
The high level and nature of recreational amenity
on offer within Kangaroo Point and its immediate
surrounds offers the resident population a unique,
high quality of life. The popular Captain Burke,
Raymond and Count White Parks are all located
within the suburb providing popular bbq and
picnic spots for social and family gatherings.
Kangaroo Point Park is considered one of
Brisbane’s best parks home to a sculpture park
and lengthy riverfront boardwalk. Upper River
Terrace is also a popular bbq spot, sitting atop the
Kangaroo Point cliffs with panoramic views across
Brisbane’s river to the CBD.
Kangaroo Point is one of Brisbane’s premier
tourist destinations. The Story Bridge Adventure
Climb ranks as one of the top tourist experiences
in Brisbane and draws local, interstate and
international tourists. Additionally, the Kangaroo
Point Cliffs are widely acknowledged as Brisbane’s
most picturesque location for abseiling and rock
climbing.
The multi-award winning Riverlife Brisbane is
located in the suburb within the heritage-listed
Kangaroo Point Naval Stores along the banks of
the Brisbane River. Riverlife offers a diverse range
of experiences, adventures, events and function
spaces which has seen the venue voted as one of
Brisbane’s top 4 attractions. Amongst Riverlife’s
most popular adventures are abseiling and rock
climbing the Kangaroo Point Cliffs, kayaking and
stand up paddle boarding along the Brisbane
River and cycling.
South Bank Parklands, within walking distance
of Kangaroo Point, is Brisbane’s premier public
space, tourist destination and recreational,
entertainment and business precinct. The 42
hectare site is visited by more than 10 million
people each year. The Parklands is separated
into three main precincts including the 17 hectare
open Parklands including Streets Beach and the
Wheel of Brisbane; the revered retail and dining
street – Little Stanley and the Grey Street cultural
boulevard including the Queensland Performing
Arts Centre, the Queensland Art Gallery, the
Gallery of Modern Art and the State Library of
Queensland.
Running along the banks of the Brisbane River is
the Kangaroo Point Bikeway which joins with the
Goodwill Bridge at the southern end of Southbank
providing a direct link with the Queensland
University of Technology’s Garden Point Campus
and the CBD. The Bikeway joins up with the South
East Bikeway running to Macgregor in the south
and the Bicentennial Bikeway running to Toowong
in the west.
PRIME
A-GRADELOCATION
THE HIGH LEVEL AND NATURE OF RECREATIONAL AMENITY ON OFFER WITHIN KANGAROO POINT AND ITS IMMEDIATE SURROUNDS OFFERS THE RESIDENT POPULATION A UNIQUE, HIGH QUALITY OF LIFE.
12
13INVESTMENT OPPORTUNITY ANALYSIS
RETAIL AND DINING
Kangaroo Point is home to two of Brisbane’s
most famous pubs – The Story Bridge Hotel and
the Pineapple Hotel. Both Hotels have long-held
reputations as being amongst the finest steak
restaurants in Brisbane. A number of other venues
are located within the suburb including The Cliffs
Café, the Dockside Comedy Club and the Brisbane
Jazz Club. Naturally, being adjacent to South Bank
Parklands the residential population of Kangaroo
Point has immediate access to Brisbane’s
most revered restaurants including River Quay,
Stokehouse, Dell’Ugo and Era Bistro.
The everyday shopping needs of Kangaroo Point’s
population are well serviced by a selection of
convenience stores and supermarkets including
the IGA X-press Kangaroo Point, Foodworks,
Coles Woolloongabba and Woolworths Spring
Hill. Just over five minutes by car is the
Coorparoo Shopping Precinct home to a full line
Coles Supermarket and a variety of supporting
convenience retailers.
Just over 4 kilometres from Kangaroo Point is
the landmark Gasworks Precinct at Newstead.
Gasworks is home to an array of cafes and
restaurants together with a Woolworths
Supermarket and the Standard Market Company
gourmet food and delicacy store.
TRANSPORT
Residents of Kangaroo Point are considered some
of the most fortunate in Brisbane with unmatched
access to Brisbane’s ferry and CityCat services.
There are three ferry terminals located at Thornton
Street, Holman Street and Dockside. In fact, more
residents use the ferry as their principal mode
of transport to work than any other suburb in
Brisbane.
Both the Cross River Ferry and the CityHopper
services operate from the Holman Street, Thornton
Street and Dockside terminals to Eagle Street Pier
in the CBD’s golden triangle in a journey taking
approximately 5 minutes. At Eagle Street Pier the
services link with the broader CityCat network
running from the University of Queensland to
Northshore Hamilton stopping at 18 locations
along the way including South Bank Parklands,
QUT Gardens Point and New Farm Park.
The population is also afforded access to the CBD
via TransLink’s bus network which takes around
15 minutes. TransLink bus services also link the
suburb with the Woolloongabba Bus Station which
is a major station on the South Eastern Busway.
From the Woolloongabba Station, high frequency
bus services operate between Mater Hill, South
Bank Parklands, the Cultural Centre and the CBD.
The South Eastern Busway connects with each of
Brisbane’s major busways in the CBD providing
access to the capital’s major employment,
education, retail and lifestyle nodes.
HIGHLY ACCESSIBLE
RESIDENTS OF KANGAROO POINT ARE CONSIDERED SOME OF THE MOST FORTUNATE IN BRISBANE WITH UNMATCHED ACCESS TO BRISBANE’S FERRY AND CITYCAT SERVICES.
KANGAROO POINTPOPULATION & DEMOGRAPHICS
15INVESTMENT OPPORTUNITY ANALYSIS
POPULATION AND DEMOGRAPHICS
According to the latest data provided by the State
Government, Kangaroo Point was home to 7,527
persons in 2011. Moving forward, the population
is projected to grow by more than 3,850 persons
by 2036. Our research reveals that this is likely to
translate into demand for more than 2,000 new
dwellings.
The residential landscape of Kangaroo Point
is similar to all major inner urban suburbs. At
the time of the 2011 Census the suburb was
overwhelmingly dominated by medium and high
density developments which accounted for almost
80% of all dwellings within the suburb. This is
in stark contrast to greater Brisbane wherein
apartments accounted for around 11% of all
dwellings.
Further mirroring the trend observed throughout
inner urban areas, couples with no children
and lone person households are the dominant
household types. Consistent with this dwelling
and household composition is a pronounced
demand for smaller dwelling types with 63% of
all homes comprised of two or fewer bedrooms.
This dwelling profile of smaller dwelling types is
more than three times that recorded throughout
Brisbane at the time of the 2011 Census.
The resident population of Kangaroo Point is
typified by young, affluent working professionals.
The area is particularly popular with Gen-Y’s
who accounted for just over 40% of the area’s
population, which was double that recorded
across Brisbane at the time of the Census. More
than half of Kangaroo Point’s resident population
were employed in professional and managerial
occupations, with more than 30% attending
tertiary institutions. Congruent with these trends
is a demographic earning significantly higher
median weekly incomes when compared to the
Brisbane, Queensland and national medians.
Demand for rental properties within Kangaroo
Point is particularly high with 60% of all dwellings
occupied by tenants at the time of the Census.
This is significantly higher than when compared
with 33% recorded throughout Brisbane.
3,850NEW RESIDENTS
DEMAND FOR
2,000+NEW DWELLINGS
60%RENTERS
KANGAROO POINTEMPLOYMENT & EDUCATION
17INVESTMENT OPPORTUNITY ANALYSIS
EMPLOYMENT
Given Kangaroo Point’s immediate proximity to
the CBD it is not surprising that an extraordinary
level of demand for residential dwellings stems
from the CBD’s workforce, currently estimated
to sit at almost 157,000 persons. By 2031, an
additional 65,000 new jobs are forecast to be
created in the CBD resulting in a total workforce in
excess of 222,000 persons.
Additional dwelling demand is underpinned by
the significant volume of professional medical and
supporting health workers at the state’s largest
medical precinct (Mater Hill) in neighbouring
Woolloongabba. The precinct is home to the
Mater Medical Centre, the Mater Private Hospital,
the recently opened Lady Cilento Children’s
Hospital, the Mater Mother’s Hospital and the
Mater Private Clinic.
Around 19,500 new jobs are anticipated to
be created over the coming years within
Woolloongabba. This major expansion of the
suburb’s workforce will inevitably underpin
demand for dwellings within the riverside precinct
of Kangaroo Point.
South Brisbane has established itself as a major
city fringe employment hub only 4 kilometres from
Kangaroo Point. The suburb was estimated to
employ more than 22,700 people in 2011, forecast
to more than double to reach just under 46,500
people by 2031.
EDUCATION
There are around 73,000 tertiary students
all studying at institutions located within a 7
kilometre radius of the Kangaroo Point/South
Brisbane and Woolloongabba precinct who are
a key contributor to demand for rental dwellings
throughout the precinct. These institutions
include:
• The Southbank Institute of Technology which
is the largest Vocational Education and
Training educator in Queensland with more
than 30,000 students enrolled across more
than 110 courses.
• The Griffith University South Bank with more
than 3,360 students enrolled contains the
Queensland College of Art, Griffith Film School
and the Queensland Conservatorium.
• The Queensland University of Technology
Gardens Point & Kelvin Grove campuses which
collectively have 39,000 students enrolled and
more than 3,500 professional and academic
staff employed.
• The University of Queensland’s St Lucia
Campus is easily accessible by a number
of bus routes running through the area and
the CityCat ferry service. The University
is the largest university in Queensland and
ranked in the top 100 universities worldwide.
The St Lucia Campus currently has student
enrollments totaling 35,150 and the
University’s Herston Campus has more than
1,500 students enrolled.
• The International Language School of
Shafston International College is also located
within Kangaroo Point and is a contributor to
demand for residential accommodation within
Kangaroo Point.
107,200+ NEW JOBS TO BE
CREATED
73,000TERTIARY STUDENTS
7KLM RADIUS
KANGAROO POINTRESIDENTIAL APARTMENT MARKET FUNDAMENTALS
19INVESTMENT OPPORTUNITY ANALYSIS
INVESTMENT OPPORTUNITY ANALYSIS19
APARTMENT MARKET FUNDAMENTALS
Kangaroo Point’s apartment market supply has
been relatively constrained principally due to a
lack of available land for redevelopment within
the area. 2014 saw the release of a handful of
new developments that recorded rapid rates
of absorption. At the time of undertaking this
research, there was less than seven months of
supply within the market.
An analysis of long term (10 year) median price
performance reveals an average annual lift in
values of 2.7%. This rate of growth has been
heavily influenced by the older, secondary nature
of product situated throughout the area. Over
the past three years, consistent with broader
residential apartment market trends throughout
the inner South, the average annual rate of growth
has lifted to a healthy 3.4% per annum suggesting
the market has entered its next growth phase.
$0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000
Newstead
New Farm
Bulimba
West End
Hamilton
Herston
Highgate Hill
Milton
Brisbane CBD
Brisbane Inner City
Kangaroo Point
South Brisbane
Fortitude Valley
Kelvin Grove
Auchenflower
East Brisbane
Toowong
Spring Hill
Albion
Bowen Hils
Dutton Park
Wolloongabba
$586,000
$560,000
$542,000
$555,000
$510,000
$516,000
$515,000
$495,000
$490,000
$480,000
$475,000
$459,000
$458,000
$442,000
$435,000
$430,000
$420,000
$420,000
$405,000
$401,00
$495,000
KANGAROO POINT IN THE CONTEXT OF BRISBANE’S INNER CITY – YEAR ENDED MARCH 2015
Source: Resolution Research - Queensland Government – June 2015
$747,000
VALUES UP3.4% P.A
INVESTMENT OPPORTUNITY ANALYSIS20
KANGAROO POINT IN THE CONTEXT OF BRISBANE’S INNER CITY
Despite recording a strong lift in median values
over recent years, Kangaroo Point remains an
affordable apartment market in the context of the
21 suburbs which make up Brisbane’s inner city.
The suburb’s median price of $490,000 is largely
in line with the inner city median of $495,000 and
is one of the most affordable riverfront suburbs
within inner Brisbane.
Given the suburb’s relative affordability, a number
of attractive purchasing propositions remain in
place within the local market – across both new
(off-the-plan) and established markets.
RENTAL MARKET CONDITIONS - APARTMENTS
As detailed earlier in this report, Kangaroo Point
is a particularly popular address for Gen Y renters
who are fundamentally seeking to occupy one and
two bedroom apartment types within the suburb.
The area’s popularity as a rental address is
underpinned by its immediate proximity to
the CBD and major employment nodes at
neighbouring Woolloongabba and South Brisbane,
together with its close proximity to some of the
state’s largest tertiary institutions.
Over recent years, median weekly rental growth
throughout the suburb has been particularly
strong. The median weekly rent of a one bedroom
apartment has grown by an average of 4.1% per
annum over the past 3 years (or $10 per week)
and a two bedroom apartment by 3.6% per annum
over the same time period.
Accordingly, given this strong rate of growth, the
suburb’s apartment market is currently achieving
a particularly healthy gross rental yield of 6.5%
making it the highest yielding suburb within inner
Brisbane.
OVER THE PAST THREE YEARS, CONSISTENT WITH BROADER RESIDENTIAL APARTMENT MARKET TRENDS THROUGHOUT THE INNER SOUTH, THE AVERAGE ANNUAL RATE OF GROWTH HAS LIFTED TO A HEALTHY 3.4% PER ANNUM SUGGESTING THE MARKET HAS ENTERED ITS NEXT GROWTH PHASE.
THE SUBURB IS ONE OF THE MOST AFFORDABLE RIVERFRONT SUBURBS WITHIN INNER BRISBANE.
HIGH GROSSRENTAL YIELD
6.5%
YIELDING INNER CITY
SUBURB
