QLD Property News July2012

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Queensland

Property News

Month in ReviewJuly, 2012


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Disclaimer: The information contained in this document has been collected by Ironfish from various public and private sources, sources which may include propertydevelopers, builders and other industry participants. Neither Ironfish nor any representative of Ironfish gives any warranty as to the accuracy of the informationcontained in this document and expressly disclaims any liability for loss or damage which may arise from any person acting or deciding not to act on the basis of anyof the information contained in this document. This document is intended to provide Ironfish clients with general information only and does not constitute an offer,contract or inducement to buy. Clients are expressly recommended to do their own due diligence in relation to any ultimate property investment decision they make.

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Sources used in the compilation of this report:

Urban Development Institute of Australia (UDIA) | Queensland State Government | The Courier Mail | The Australian -

Business with the Wall Street Journal, National Affairs | Architecture and Design | Property Observer

QLD Property NewsState headlines at a glance

July, 2012

QueenslandProperty trends reported in the media

Airport Link gets off the ground with flying colours in driving time tests. [Queensland]: Lending for construction surges. Towering hopes for Brisbane city waterfront. Brisbane to host 2014 G20 forum. North Shore Hamilton earns green tick of approval. Property investor activity on the rise in mining states WA and Queensland: Knight Frank. [QLD Government]: We will deliver better infrastructure and better planning. Gold Coast eyes cruise ship precinct. Queenslands new infrastructure think tank recruits sustainable development and architecture researchers.

Brisbane



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Airport Link gets off the ground with flying colours indriving time tests.

Robyn Ironside and Sarah VoglerJuly 26, 2012

IT was the ultimate test of Brisbane's latest road tunnel - could it save time compared with the old

roads above that have carried millions of motorists over the years?

The answer was positive.

The Courier-Mail yesterday took the old roads and new for a time trial on the opening day of the $4.6 billion Airport Link,which winds beneath Brisbane's inner-northern suburbs.

The travel time from Bowen Hills to the airport was cut by six minutes through the tunnel. From the airport to the Valley,the saving was four minutes while the congested Valley to Kedron route saved seven minutes underground. But thedelayed opening of Brisbane Airport Link cost four executives of the operating company almost $1 million in bonuses.

BrisConnections CEO Ray Wilson, chief financial officer Nicholas Lattimore, general manager construction CharlesMacDonald and company secretary Tamira Herbst stood to earn a total of $1.9 million if the project had finished byJune 30. But running over schedule by more than three weeks meant the four pocketed $981,317. Dr Wilson claimedalmost half that amount. The exorbitant incentives emphasise the high stakes associated with the $4.8 billion project,described as a "game changer for the economy" by chairman Trevor Rowe.

Visiting Airport Link's Kedron control room, Deputy Premier Jeff Seeney also gave the road a ringing endorsement."It will be an enormous economic boost, it will change the whole way business is done because of that connectivitythat other cities don't have," Mr Seeney said. "Sydney and Melbourne would love to have something like this and it

will fundamentally change the city."

TIME SAVER: Some of the first cars use the Airport Link tunnel yesterday to avoid traffic jams and numerous sets of traffic lights.Tim Marsden Source: The Courier-Mail



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[Queensland]: Lending for construction surges.

Media releaseJuly 11, 2012

Housing finance figures released today (11 July 2012) by the Australian Bureau of Statistics reveal

the highest number of Queensland owner-occupiers borrowed to construct a new home in Maysince March 2010.

Lending for the construction or purchase of new homes performed strongly in May in Queensland - up 33.5%.

Over the full May quarter', lending for the construction or purchase of new homes rose 14.9%.

Across Australia, a similar surge inlending for new homes occurred with anincrease of 28.2% in the month of May

and 14.9% over the full May quarter.

In contrast to the surge in new homelending to owner-occupiers over the lastthree months, total building approvalshave remained flat during the sameperiod, indicating that investor activityremains subdued in the new homemarket.

In further encouraging news, first homebuyer activity continues to increase inQueensland with 5,422 loans in the May

quarter for both new and establishedhomes - a level not seen since January2010.

This is not unexpected given the significant cuts tointerest rate cuts delivered by the RBA this year. First home buyers now make up 19.8% of all lending to owner-occupiers in Queensland - up from a low of 15.6% in mid-2011.

Despite renewed concerns over Greece and the global economy, UDIA (Qld) remains of the view that a combinationof rising incomes, higher population growth, improving affordability and low interest rates will drive moderate growthin residential sector activity in Queensland over the remainder of 2012.

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Chart 1: Owner Occupier new home lending

Original, Moving quarterly total



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Towering hopes for Brisbane city waterfront.

Andrew FraserJuly 21, 2012

THE Queensland government is

confident work will begin earlynext year on a high-rise building

beside the Brisbane River tohouse public servants, kick-

starting the development of a

new waterfront precinct inBrisbane's CBD.

State Housing and Public Works MinisterBruce Flegg said the government hadreceived nearly 40 expressions of interestto construct the building, but it was onlyone of seven sites in the precinct -known as the Lower George Streetredevelopment - where the governmentwas testing the private market toestablish the level of interest.

"We've started with 1 William Street because that's on a vacant block of land. None of the other sites are completelyvacant, so it makes sense to get that first project under way. But we are also very interested in seeing what sort of anintegrated development we can have, which will go past the one specific site and look at the whole precinct."

The Newman government has pleaded it has been left in dire financial straits by its predecessor, and Dr Flegg saidthere would be strong private sector involvement in the redevelopment. Major companies that have submittedexpressions of interest include Westfield, Mirvac, Echo Entertainment, Leighton Properties, Thiess, Investa PropertyGroup, Hansen Yuncken, CBus Property, Watpac, Hutchison Builders and Neilson Properties. "Ultimately we want todo a lot more than just put up a big building. We want the revitalisation of the whole precinct, including the waterfront,"Dr Flegg said.

The new building is likely to have a large retail component in its lower floors, and possibly entertainment facilities. DrFlegg said there was greater potential for entertainment and retail in the part of the Lower George Street precinct thatruns alongside the Brisbane River, close to the southeast freeway. At this point the freeway runs over the river on giantpylons while the riverfront is a bitumen area used largely by runners and cyclists and a terminal for the CityCat ferries.

"We've got an open mind on it, but really we're interested in any low-impact commercial or entertainment proposal thatthe private sector comes up with for that particular section. A marina wouldn't be out of the question either."

The riverside site and the southeast freeway, which runs over it, has been a problem for successive Queenslandgovernments. When Peter Beattie was premier he proposed putting a high-rise building over the freeway, enclosing it,which he argued would reduce its visual impact, but the idea was dropped after negative public feedback.

Former premier Anna Bligh championed a "Northbank" on the same riverside site, involving a development similar toSouthbank, on the other side of the river, mainly built on a platform jutting substantially into the river. There was againstrong negative public reaction and the idea was buried.

Dr Flegg, mindful of this history, is trying a different tack by tying development of the waterfront to the development ofthe land behind it. The government is cancelling plans of the former government to construct a building at Bowen Hillson Brisbane's northside for public servants, instead locating them at 1 William Street. Dr Flegg said public servants

were scattered around the Brisbane CBD in more than a dozen buildings. The new building would put them all in oneplace.

An artist's impression of one redevelopment option for the George Street precinct onBrisbane's waterfront. Source: Supplied



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Towering hopes for Brisbane city waterfront / continued...

But the public servants being relocated should not expect much room. Dr Flegg said one public servant occupied anaverage of 18sq m at the moment, about 40% above the private-sector standard, which he thought the governmentshould adopt.

The public servants might not find their new building as roomy as their current offices, but they will get better views.The new building is expected to have about 60,000sq m of floor space in more than 35 storeys. "We don't have anyheight restrictions at that point, so we do have that room to go up if we need to," he said.

A private-sector proposal already knocked on the head is that of casino operator Echo Entertainment, which runs theBrisbane casino, just outside the Lower George Street area. Echo had a proposal that involved the old State Library -between the casino and the waterfront site - but Dr Flegg said that would remain a heritage area.

Brisbane to host 2014 G20 forum.

Sarah Elks & Matthew FranklinJuly 11, 2012

BRISBANE will host the 2014 G20 meetingof the leaders of the world's richest

nations, including the US and China.

In a major coup for Queensland, the event will bethe largest international gathering on Australian soilsince the 2007 Asia-Pacific Economic Co-operationforum in Sydney, which required a massive securityoperation and locked down the city for days. JuliaGillard announced last November that Australia hadwon the right to host the G20, the world's mostimportant economic co-operation meeting, and the

states have been vying for the host role since.

A spokeswoman for Queensland Premier Campbell Newman said last night an announcement from the federalgovernment was expected today. "We understand Queensland is the preferred venue," she said. Given the state ofthe Queensland economy, it is understood Mr Newman is pushing for the commonwealth to cover the entire cost ofthe summit, which could run to $400 million.

The Australian understands the state government is also asking for a guarantee that no regional centres would bedeprived of police during the forum. In May, the federal budget revealed that $326.9m would be provided to PrimeMinister & Cabinet over four years for the organisation and logistics of the leaders' summit and related policydevelopment and co-ordination.

Treasury will receive $45.2m over four years to cover the organisation and logistics of the meetings of financeministers, central bank governors and related officials. The meeting is expected to attract 4000 delegates and up to

3000 media from around the world.



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North Shore Hamilton earns green tick of approval.


A major waterfront redevelopment located six kilometres from Brisbane's CBD has received topmarks for ecological sustainability from national green rating tool EnviroDevelopment.

Northshore Hamilton, being delivered by the Urban Land Development Authority (ULDA), will occupy 304 hectares ofprime urban renewal space on the banks of the Brisbane River, including over 2.5 kilometres of riverfront to bereserved as public and community space. The project has been heralded as the most significant waterfrontredevelopment in Brisbane since Expo 88 and South Bank.

National EnviroDevelopment Manager Kirsty Chessher said the project displayed an impressive commitment to bestpractice environmental sustainable design, which had earned the development certification in EnviroDevelopment'ssix areas of sustainability: ecosystems, waste, energy, materials, water and community. "Given the size andsignificance of this development, it is fantastic to see such a strong commitment to environmental sustainability beingimplemented from the outset," Ms Chessher said. "The decision to give back prime riverfront space to the communitydemonstrates the ULDA's dedication to environmental values and lifestyle outcomes, and will set this precinct apart inthe years to come."

Over the next 20 years, the ULDA will help transform the Northshore Hamilton Urban Development Area (UDA) froman industrial area to a lively mixed-use riverside community which will eventually cater to around 15,000 workers and15,000 residents. The vision for the UDA is to ensure that all development is sensitive to the environment by ensuringself-sufficiency through alternative sources of energy, water and waste disposal. The precinct's masterplan ensuresprotection and best practice management of natural systems, habitats and biodiversity, and promotes efficient useand management of precious resources such as materials, water and energy.

One feature of the site is the provision of a vacant building, The Shed', for use as a community-based arts andcultural hub. The Shed will create an inclusive, accessible and vibrant space for residents of Northshore Hamilton andthe inner Brisbane community, offering a range of spaces for artistic, cultural and recreational activities. Theincorporation of best practice environmentally sustainable design and construction has been fundamental to contractsawarded for the development of public facilities such as the Northshore Riverside Park and Caf.

Northshore Hamilton is the sixth ULDA development to achieve EnviroDevelopment certification.



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Property investor activity on the rise in mining states

WA and Queensland: Knight Frank.Larry SchlesingerJuly 31, 2012

Property investors are becoming more active in Australias two mining states Western Australiaand Queensland, according to a recent reportbyKnight Frank.Declining numbers of properties available for sale in the Perth metro area combined with a strong rental market arebringing high numbers of investors back to Perth, says Neil Kay, Knight Franks director of residential projectmarketing.

He notes Real Estate Institute of Western Australia (REIWA) figures that show the number of properties in the Perthmetro area available for sale has been steadily dropping over the last 10 months. It reached a high of circa 18,000properties [including house, unit and land] early last year in 2011."

However, according REIWA we are sitting at around 13,400 properties on the market, and this is decreasing everyweek, due to a combination of factors over the last year, such as WA has the fastest-growing population rate andlowest unemployment, highest wages, and so on, says Kay.

He says WA now has one of the strongest rental markets, with huge numbers of people flocking to the area forwork. Inner-city rents have jumped about 30%. For example a two-bedroom unit fully furnished was $600 perweek 12 months ago. Over the last two weeks, we have been renting the same unit for $850 per week.

Supply of property for sale is dropping as owners decide to rent out their property instead of selling."Major oil and gas companies and all the supporting businesses and companies are opening up offices andbringing people over to work. So the rate of sales in off-the-plan apartments is increasing as the supply inestablished apartments tightens.

Kay says its only a matter of time when all these factors combine to start putting increasing pressure on propertyprices to start rising.

In Queensland, investors are opting for low-rise (or horizontal) off-the-plan development as opposed to high-rise(or vertical) off-the-plan development, says Mathew Cassidy, Knight Franks residential property manager forproject marketing. The reason seems to be surety around delivery of the property, meaning that the villa or housewill be delivered in a time frame that suits their specific situation, he says.

Cassidy also expects a recovery in sales volumes on the more predictable Gold Coast and Brisbane barring anyunforeseen world crisis with rentals in both areas still strong. Regional mining areas have seen strong capitalgrowth and new construction. Our regional offices note that this looks set to continue for several years at least.

Occupancy rates and rental returns are flourishing due to a lack of quality accommodation and dwellings, he says.The strong performance of Perths rental market in particular and Brisbanes to a lesser extent was revealed inthe March quarter figures put out by the Real Estate Institute of Australia (REIA).

Perth rents for three-bedroom houses have risen 9% over the previous 12 months to a median of $425 while two-bedroom units are up 8.1% over this period to $400, according to the REIA.

Brisbane three-bedroom house rents are up 2.9% to a median of $360 for the 12 months to March while two-

bedroom units are up 4.3% to $365.



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[QLD Government]: We will deliver better infrastructureand better planning.


The government will share the proceeds of the mining boom, improved government efficiencies andbetter economic management to build roads and provide critical local infrastructure, open up NationalParks so that all Queenslanders can enjoy them and protect the states best cropping land.

We have commenced work to ensure local councils have the power they need to better plan for the future growthof local communities. The government is committed to delivering the following actions over the next six months:

Commence construction of the Sunshine Coast University Hospital.

Simplify planning by amending the Sustainable Planning Act. Complete the Galilee and Surat Basin infrastructure plans and progress the Surat Basin rail project. Deliver legislation to support the work of the Gasfields Commission. Prepare draft statutory regional plans for the Darling Downs and the Golden Triangle for public

consultation in 2013. Publish new guidelines to support Royalties for the Regions, and receive and assess first round

applications. Submit priorities for infrastructure funding from the federal government. Deliver the first draft of the 10 year strategy for the Bruce Highway upgrade. Develop a strategy to revitalise the Mary Valley. Transfer responsibility for South Bank to the Brisbane City Council. Work with Indigenous councils to implement their community plans. Identify and complete five priority pest management programs for Queenslands National Parks. Release a new infrastructure plan for Queensland racing. Identify the first projects for the Marine Infrastructure Fund. Finalise the policy to create simplified, single state planning arrangements. Complete design for the Toowoomba CBD ring road and the West Creek railway bridge. Develop options to expand heavy vehicle access to the existing road network. Determine the optimal approach to improving access to Trinity Inlet. Finalise the strategy and commence the business case to deliver an increase in the SEQ rail network

capacity. Introduce 15 minute off peak services on the Ferny Grove train line from Monday to Friday. Release plans for flood mitigation work at Blakeys Crossing and for the Woolcock and Mather Street

intersection upgrade. Deliver the 2012 roll out of flashing lights at school zones. Complete priority recommendations of the Floods Inquiry Report. Commence works on the redevelopment of the government administrative precinct in Brisbane.

Transfer management of Roma Street Parklands to the Brisbane City Council. Finalise the Boundaries Commissioners decision on which local councils will proceed to a poll about de-amalgamation.

Develop and commence implementing the Indigenous Councils Capacity Building Program. Announce first round of Everyones Environment grants to improve our local environment. Commence work to amend the Queensland Coastal Plan. Complete the consultation report on suitable areas of Cape York for World Heritage listing. Progress the strategic assessment for the Great Barrier Reef including a ports strategy. Investigate acquisition of habitat for the preservation of koalas, commence a four year koala research

grant program and invite applications for koala rescue and rehabilitation services. Deliver, in partnership with the sugarcane and beef industries, a framework for a best management

program to protect the Great Barrier Reef. Finalise consultation and a preliminary draft of the Cape York Bioregion Management Plan. Deliver a plan for a government digital communication radio network in partnership with industry.

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Gold Coast eyes cruise ship precinct.

Lisa AllenJuly 28, 2012

NEW Gold Coast mayor Tom Tate is fielding six

proposals for cruise ship terminal and hotelcomplexes.

And he expects more may land on his desk as he attempts toput southeast Queensland firmly back on the leisure tourismmap. "Basically, cruise ship industry bookings are growing by34% a year," Mr Tate said.

"That benefit is sailing past us and we want to be part of that.It fits in with our tourism infrastructure and I am confident thatanyone who arrives on the Gold Coast will not be able to resistgetting off (a cruise ship) and enjoying what we have to offer -the great shopping and the theme parks." The cruise ship terminal projects include hotels and leisure facilities for thesouthern end of the tourist strip proposed by veteran developer Bob Ell; a "soft option" from the council valued at$45 million; and at least three other informal proposals.

Mr Tate described Mr Ell's proposal as quite good. "He has hotels and he will be doing a formal submission in the next14 days," Mr Tate said. "I gave them some of my environmental concerns, I want a timeframe and a capabilitystatement."

International players are also showing interest. Yesterday, former Gold Coast businessman Ric Grosvenor met Mr Tate todiscuss ambitious plans for a $4.9 billion cruise ship, casino, residential, marine and tourist precinct on the Gold Coast's

Broadwater. Mr Grosvenor is president and chief executive of Sembawang of Singapore, a global project underwritinggroup that he said had completed projects throughout Asia and the Middle East.

While he has not secured investors for his project yet, Mr Grosvenor said he would proceed only if locals supported him:in short, he does not want to be plagued by angry environmental groups, otherwise he will walk away. Under his plan, a"world-class" destination known as Wavebreak would be built in time for the 2018 Commonwealth Games.

It would include two cruise ship terminals, a casino, 1500 hotel rooms - ranging from four to six stars - 12 superyachtberths, a 400-berth marina and a Fisherman's Wharf-style trawler centre. The cruise ship terminal would be located onthe north end of Wavebreak Island. The project would need approval by local, state and federal governments andagencies. "At the moment we are putting the concept forward to see how it is perceived," Mr Grosvenor said.

Mr Grosvenor described the Gold Coast as a "wasteland" desperately in need of tourism infrastructure. "It's lamentable

that the Gold Coast, which was once such a joyous place to visit, is no longer that. It has lost its lustre," he said. "It (thecruise ship terminal) would become the locus or centre of a rejuvenated coast." Mr Grosvenor believes it could take atleast five years to get planning approval.

Mr Tate said the proposal would not be put to tender. "I will narrow it down to three options ... I will talk to the Premier ...ultimately it will be the Premier's decision," he said. However, if he does not like any of the private sector proposals, hesaid the council would proceed with its own cruise ship terminal. "The conversation is no longer if we get a cruise shipterminal, it's where," he said. "If none of the options stack up, the council will do its own cruise ship terminal."

In other Queensland tourism infrastructure news, Great Keppel Island will be developed as a $600m eco-tourism resort.Public comment opens on Monday for the proposal when the environmental impact statement is released.

The resort on the island off central Queensland closed in 2008.

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Former Gold Coast businessman Ric Grosvenor has ambitious plans for a

$4.9 billion cruise ship, casino, residential, marine and tourist precinct onThe Broadwater. Picture: Glenn Hampson Source: The Courier-Mail



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Queenslands new infrastructure think tank recruitssustainable development and architecture researchers.

Staff writerJuly 18, 2012

The Queensland Government is bringing together a range ofexperts, including in development and architecture, to advise

on the states future infrastructure needs.

Reporting to the Department of Infrastructure Planning and StateDevelopment, the group is expected to adopt a lateral thinking approachto assist the Minister examine procurement and finance options for thedelivery of infrastructure in Queensland.

Professor Michael Regan from Bond Universitys Institute of SustainableDevelopment and Architecture has been appointed to the newly-formedInfrastructure Queensland committee.

Professor Regan joins a team of highly regarded private sector representativesand government department heads.

As one of Australias leading researchers in his field, Professor Regan haspublished numerous peer-reviewed papers on major infrastructure projectmanagement and procurement, encompassing the financial, economic andpublic policy perspectives.

The Infrastructure Queensland advisory group comprises a team of very experienced people with high-level expertisein water supply, ports, construction, engineering, transport, finance, and local government, said Professor Regan.

My contribution will be based on the multi-disciplinary research I have conducted here at Bond University, covering allthe different components of infrastructure planning and development.

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Disclaimer

The information contained in this document has been collected by Ironfish from various public and private sources, sources whichmay include property developers, builders and other industry participants. Neither Ironfish nor any representative of Ironfish givesany warranty as to the accuracy of the information contained in this document and expressly disclaims any liability for loss ordamage which may arise from any person acting or deciding not to act on the basis of any of the information contained in thisdocument. This document is intended to provide Ironfish clients with some general information only and does not constitute anoffer, contract or inducement to buy. Clients are expressly recommended to do their own due diligence in relation to any ultimateproperty investment decision they make.

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QLD Property News July2012

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