<a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> has lodged plans for a $750 million, three-tower mixed-use precinct that would complete the long-running redevelopment of Carlton's former Carlton United Breweries site.

The proposal at <a href="https://www.apartments.com.au/new-apartments/185-195-queensberry-street-carlton-vic-3053">46-78 Bouverie Street and 185-195 Queensberry Street</a> spans a 6,468 sqm site, the last remaining undeveloped parcels within the former brewery's 2007 masterplan.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the development will comprise two purpose-built student accommodation towers and a third build-to-sell apartment tower above a shared commercial podium and basement.

Across the three towers, SP Setia is proposing 606 build-to-sell apartments and 1,499 student accommodation units containing 2,009 beds.

The apartments will sit in the tallest tower, which will rise nearly 200m and 55 storeys. It will become&nbsp;one of the more substantial new build-to-sell apartment projects at the northern edge of Melbourne's CBD.

The apartment mix is weighted toward smaller inner-city product, with 188 studios, 206 one-bedroom apartments, 192 two-bedroom apartments and 20 three-bedroom apartments

<img alt="First look: SP Setia plans three-tower finale for Carlton’s former CUB precinct" data-entity-type="file" data-entity-uuid="8271bc87-1b0a-41b7-ac73-a425ee375261" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/3_2.png?VersionId=G4lw23o90B1boX4k4dj7rdz2ZEajS9wy" />

Part of the precinct will be a large-scale&nbsp;3,684 sqm supermarket and a further 2,198 sqm of speciality retail, creating close to 5,900 sqm of new commercial space within the precinct.

But one of the biggest components of the proposal is what sits between the buildings.

Around 4,650 sqm, or roughly 72 per cent of the site, will be publicly accessible open space, incorporating plazas, pedestrian connections, landscaped laneways and retail spill-out areas.

The ground plane is intended to finally complete pedestrian connections envisaged when the CUB masterplan was first approved nearly two decades ago, stitching together Victoria Street, Queensberry Street, Bouverie Street and Swanston Street through the former brewery precinct.

Urbis said the development would "complete the CUB precinct", with the public realm providing important north-south and east-west connections through what is currently the final undeveloped portion of the masterplanned site.

SP Setia is also exploring a new linear park within the Bouverie Street road reserve, with the concept to be developed further with the City of Melbourne through the planning process.

The proposal is being pursued through the Victorian Government's Development Facilitation Program under Clause 53.23 for significant residential development with affordable housing.

The planning report acknowledges the proposed heights exceed those contemplated under the original Comprehensive Development Plan and masterplan, but argues the built-form context has changed considerably over the past two decades.

Urbis said the three towers would instead create a stepped transition between Carlton and the Hoddle Grid, rising progressively from the 94.1-metre Tower One along the Queensberry Street edge to the 199.44-metre Tower Three closer to the established CBD-scale buildings to the south.

<img alt="SP Setia" data-entity-type="file" data-entity-uuid="e885a07a-592c-40fc-bf82-e6dbaf32da54" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.52.24%E2%80%AFAM.png?VersionId=7s_ErUkSKAdY1mAWp3GRZgMNCGtwhk5m" />

SP Setia plans to deliver the development across three stages.

Stage One would deliver the basement, podium and retail areas for the entire precinct alongside the first student tower. Tower Two would follow in Stage Two, before the 606-apartment Tower Three is delivered as the final stage.

If approved and delivered, the project would close out a redevelopment process that has been underway since the former brewery masterplan was approved in 2007, adding more than 2,600 student beds and apartments to a precinct already home to Swanston Central, the Barak Building, RMIT Design Hub and several large student accommodation developments.

&nbsp;

&nbsp;

Joel Robinson

SP Setia plans three-tower finale for Carlton’s former CUB precinct

Melbourne developer Lowe Living is seeking to add to its growing bayside apartment pipeline, filing plans for a boutique eight-residence development in tightly held Middle Park.

Lowe Living, which has built much of its development portfolio across Melbourne's affluent bayside and south-east suburbs, is behind the plans for the 730 sqm site at <a href="https://www.apartments.com.au/new-apartments/123-125-erskine-street-middle-park-vic-3206">123-125 Erskine Street</a>, just off Armstrong Street and within the Armstrong Street Neighbourhood Activity Centre.

The developer is seeking approval for a five-storey residential building above two basement levels, with just eight large-format apartments and 18 car spaces.

“This is a deliberately very different proposition for us,"&nbsp;Tim Lowe, Co-Founder of Lowe Living, said.

"Eight residences is exceptionally boutique, but that's precisely what this site calls for.

“There is a strong community in Middle Park and the surrounding suburbs who have spent decades building a life here. They no longer want the maintenance of a large period home, but they aren't prepared to compromise on space, quality or location. We think there is a real opportunity to capture that hyper local market. A site like this rarely comes to market.”

<img alt="Lowe " data-entity-type="file" data-entity-uuid="875fe572-0f14-4d90-9e11-55b28dd07731" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.42.49%E2%80%AFAM.png?VersionId=GDNQRv9BfpR9r1zkZ5UDyUM4ZvpIksut" />

The low-density proposal has been designed by Cera Stribley and is being progressed through the Victorian Government's Great Design Fast Track pathway, having already secured eligibility from the Minister for Planning.

The Office of the Victorian Government Architect supported its eligibility after finding the proposal demonstrated consistency with the program's seven design principles, while the project's financial feasibility has also been independently confirmed by Invest Victoria.

The project is targeting the downsizer market, with the planning documents describing the homes as larger-format residences and noting the two penthouses could otherwise have been configured as four separate apartments.

<img alt="Lowe 2" data-entity-type="file" data-entity-uuid="60ab0987-2da6-4175-adac-315dcf6053c6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.15%E2%80%AFAM.png?VersionId=bOCPH0B2MFwlmaRW.TTCF9TzyifgVoQI" />

The site has dual frontage to Erskine Street and Canterbury Place and currently comprises a collection of commercial buildings used as offices, including a former heritage bakehouse, a former stable, a later gabled addition and a central courtyard.

It sits within the Commercial 1 Zone and the Armstrong Street Commercial Precinct heritage overlay, with the existing property classified as a contributory heritage place.

Heritage has subsequently played a significant role in Cera Stribley's design.

The front section of the former bakehouse facing Erskine Street will be retained, including its return walls, street-facing hipped roof and chimneys, while the Erskine Street façade and part of the western return wall of the former stable will also be incorporated into the new development.

Levels four and five will be set back five metres from the retained stable façade, while bricks removed through demolition are proposed to be salvaged and reused within the new building where possible.

<img alt="Lowe 3" data-entity-type="file" data-entity-uuid="e97927a9-a2de-4a0f-83b6-65451238abfa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.06%E2%80%AFAM.png?VersionId=VR44AChLrX9q1XPB9GvVQV.ALXXbe4gC" />

Rather than presenting as a single five-storey building to Erskine Street, Cera Stribley has broken the development into a series of distinct forms.

A three-storey infill element will sit between the retained bakehouse and stable façades, with the upper levels recessed behind the heritage fabric. Canterbury Place will similarly feature two three-storey podium forms, separated by a central pedestrian accessway, before the upper two levels step back from the street.

A pedestrian through-link will run through the centre of the project between Erskine Street and Canterbury Place, creating entrances from both sides of the site and introducing landscaping and communal areas through the ground plane.

Landscape architect Acre has designed planting across the ground level, private terraces and upper levels, including a feature canopy tree at level three and integrated planting and arbours across the level four terraces. Five existing Erskine Street trees are proposed to be retained.

Sustainability is also a significant component of the Great Design Fast Track application. The apartments are targeting an average eight-star NatHERS rating, with no residence below 6.5 stars, while the project has achieved a 75 per cent BESS score. Seven of the eight apartments are designed for cross-ventilation, with the remaining residence using mechanically assisted natural ventilation.

The plans also incorporate an 8kWp rooftop solar system, a 5,000-litre rainwater tank and infrastructure allowing future electric vehicle charging for every residence.

Lowe has a strong portfolio across Melbourne's blue-chip suburbs. They recently launched <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House by Lowe Living</a> in Camberwell, their first development in the Stonnington LGA.

Lowe Living unveils Middle Park apartment development

Article summary

<ul data-end="888" data-start="289">
	<li data-end="442" data-section-id="8tsh6o" data-start="289">DVB Projects is preparing to launch its second Gold Coast apartment development, with demolition now underway at 137 Old Burleigh Road, Broadbeach.</li>
	<li data-end="573" data-section-id="1nyxl3e" data-start="443">The 34-level tower will comprise just 49 ultra-luxury residences, including half-floor, full-floor and penthouse apartments.</li>
	<li data-end="717" data-section-id="oiyimj" data-start="574">The launch follows strong demand at DVB's nearby Sea Glass project, which is more than 50 per cent sold and currently under construction.</li>
	<li data-end="888" data-section-id="epk9o9" data-start="718">The development adds to the transformation of Old Burleigh Road, with premium beachfront apartment projects continuing to reshape the tightly held Broadbeach strip.</li>
</ul>

<a href="https://www.apartments.com.au/developers/dvb-projects">DVB Projects</a> is preparing to launch its second Gold Coast apartment development, with demolition now underway on the Broadbeach site as the Sydney developer moves closer to bringing the ultra-luxury project to market.

The 34-level tower at <a href="https://www.apartments.com.au/new-apartments/137-old-burleigh-road-broadbeach-qld-4218">137 Old Burleigh Road</a> will comprise just 49 residences, ranging from half-floor apartments through to full-floor homes and a penthouse. The launch follows the strong sales performance of DVB's nearby Sea Glass development. More than half of the apartments at Sea Glass, on the other side of Broadbeach, have been snapped up, well ahead of its late 2027 completion

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="2944b4be-c84e-4b54-8dc1-c712e76704c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E02_Exterior_Street%20Level%20Entrance.jpg?VersionId=YoNig7pRdrE3HCue7sUj78LzJteeQf3H" />

The start of demolition at 137 Old Burleigh Road signals DVB Projects’ underlying confidence in the Gold Coast’s luxury beachside apartment sector.

“We see the Gold Coast as one of the most compelling lifestyle markets in Australia, particularly at the premium end where demand continues to deepen,” said Dean Brown, Managing Director of DVB.&nbsp;

“This project has been carefully designed to respond to that demand - delivering large-format residences with a level of quality, privacy and amenity that is still relatively rare in the apartment market on the beachside."

Brown says the site itself is "exceptional."

"Old Burleigh Road is one of the most tightly held beachfront strips, and opportunities to deliver a project of this scale and calibre in this location are extremely limited.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="398f377a-c037-455e-9250-0c5e0d84c35b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/I12_FF%20Balcony.jpg?VersionId=NwOiRWGMubR1c8wthuEfggklcja7al9." />

The project will comprise 40 half-floor residences of approximately 260 sqm, alongside eight full-floor residences spanning around 524 sqm.

A single penthouse will crown the building, featuring a private pool, barbecue area, indoor gym and dedicated entertaining spaces.

Residents will have access to a resort-style suite of amenities, including a 20-metre pool with daybeds, a gymnasium, hot and cold plunge pools, a sauna, and private residents’ lounge and dining facilities.

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="d1642bb0-9a66-4427-a022-dfc0988c6287" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/A02_Pool%20to%20View.jpg?VersionId=c0IXPyn_Gp_Kn3XCwzMrqIVkAdCEwVXP" />

Sales agent Todd Matheson, of <a href="https://www.apartments.com.au/project-marketer/pezet-matheson">Pezet Matheson</a>, which is marketing both 137 Old Burleigh Road and Sea Glass, said 137 Old Burleigh Road would address a clear gap in the market for genuine luxury products.

“There are very few opportunities on the Gold Coast where buyers can secure a residence of this size and quality in a new building,” Matheson said.

“What we’re seeing is a growing cohort of downsizers and interstate buyers who still want space - they’re not willing to compromise on living area, entertaining or finishes.

“This project has been designed with that buyer in mind. It offers the scale of a home, combined with the convenience and security of apartment living, in one of the coast’s most desirable positions.”

<img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="59aae0ca-5639-4320-8aca-d0bf60f48e43" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E01_Exterior%20Hero.jpg?VersionId=DS8Zfy2WtgUEtdfe0TEUuf1W1GfcZq8S" />

Located on a 1,156 sqm site one block from the beachfront, the development will replace an ageing walk-up building and is expected to contribute to the ongoing transformation of the Old Burleigh Road strip into one of the Gold Coast’s most prestigious residential corridors.

With the development moving into the delivery phase, 137 Old Burleigh Road is slated to hit the market later this year.

[smartcode_project_cta:default project_id=145141]

DVB Projects to launch second Broadbeach apartment tower as demolition commences

<a data-end="327" data-is-only-node="" data-start="250" href="https://www.apartments.com.au/developers/norus-projects" rel="noopener" target="_new">Norus Developments</a> has lodged plans for a new apartment development in Clayton that would add further momentum to the suburb's emerging Green Street corridor.

Plans have been lodged for the consolidated site at <a href="https://www.apartments.com.au/new-apartments/1359-1365-centre-road-clayton-vic-3168">1359-1365 Centre Road</a>, where Norus is seeking approval for 218 apartments across a 12-storey apartment building designed by <a href="https://www.apartments.com.au/architects/life-architecture-and-urban-design">Life Architecture</a>.

The proposal sits within the Clayton Major Activity Centre at the threshold of the planned Green Street corridor, a landscaped pedestrian connection intended to improve links through the precinct towards Clayton Railway Station.

The development would replace the site's existing collection of low-scale residential and commercial buildings with a single consolidated building, introducing significantly greater housing density to this part of Centre Road.

A retail tenancy is proposed at ground level to activate the Centre Road frontage, accompanied by transparent street interfaces and landscaping intended to create a more pedestrian-focused edge to the development.

<img alt="First look: Norus Developments plans landscape-led apartment project for Clayton’s emerging Green Street" data-entity-type="file" data-entity-uuid="0a5a763a-d9e9-4253-af2f-88008de27ebf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Clayton%20a.png?VersionId=S2WJJbat1XVkZwB9SnYtygirXgWHiklX" />

The building has been designed with stepped massing and upper-level setbacks to manage its transition towards surrounding residential properties. The planning report describes the approach as one that integrates the building into the landscape rather than treating landscaping as a secondary element.

"A strong landscape and public realm strategy underpins the proposal," Urbis states in the planning report.

"Public benefits include an affordable housing contribution, a new pocket park, generous landscaped setbacks, deep soil planting and integrated Water Sensitive Urban Design."

The report adds that these elements are intended to create "a permeable, pedestrian-focused ground plane that enhances walkability, supports urban cooling and reinforces the emerging Green Street character."

Biophilic and passive design principles extend through the residential levels, with planting, daylight, natural ventilation and views towards landscaped areas forming part of the amenity strategy.

Parking would be concentrated away from the public realm, with 145 car spaces proposed from the rear laneway rather than dominating the Centre Road frontage.

The proposal follows an extensive pre-application process with the City of Monash. Three formal meetings were held between the project team and Council from December 2025 to March 2026, with the scheme evolving through several concept iterations before the current design was lodged.

The project arrives as Clayton prepares for substantial change around its established activity centre and the wider Suburban Rail Loop precinct. Its position on Centre Road places the development within an existing concentration of shops, services and public transport, while the Green Street connection is intended to strengthen pedestrian access towards Clayton Railway Station.

First look: Norus plans landscape-led apartment project for Clayton’s emerging Green Street

<a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a> has officially commenced construction on Bronze on Chevron, celebrating the sod turning of its first-ever Gold Coast development and marking a significant milestone in the company's continued expansion across South East Queensland.&nbsp;

Following the successful delivery of premium residential developments throughout Brisbane and the Sunshine Coast, <a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-chevron-island-qld-4217">Bronze on Chevron</a> represents Gardner Vaughan Group's entry into the Gold Coast market. Bronze will deliver 119 one, two, three and four-bedroom apartments above two ground-level retail tenancies.

[smartcode_project:default project_id=107520 project_image_fid=367193]

The recent sod turning ceremony was attended by Deputy Mayor Mark Hammel, President of the Surfers Paradise Surf Life Saving Club, Cassandra Sedgman, project consultants, purchasers, project partners and invited guests to celebrate the commencement of construction.&nbsp;

Gardner Vaughan Group Chief Executive Officer Simon Betteridge said Bronze on Chevron represented an exciting new chapter for the business.&nbsp;

"We've spent almost four decades building homes that respond to the way people want to live, and we're excited to bring that experience to <a href="https://www.apartments.com.au/developments/chevron-island-qld-4217">Chevron Island</a>," Betteridge said.

"Bronze on Chevron is particularly significant because it marks Gardner Vaughan Group's first development on the Gold Coast following many successful projects across Brisbane and the Sunshine Coast."

[smartcode_project:default project_id=107520 project_image_fid=367183]

Betteridge said the ground breaking is a proud moment for the&nbsp;team and their purchasers, who can now see their future homes beginning to take shape.&nbsp;

"As both developer and builder, we're able to oversee every aspect of the project from design through to construction, ensuring the quality and attention to detail Gardner Vaughan Group has become renowned for."&nbsp;

Designed by acclaimed architectural practice <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, Bronze on Chevron has been thoughtfully designed to complement Chevron Island's evolving streetscape while embracing its relaxed coastal lifestyle.

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029.&nbsp;

[smartcode_project_cta:default project_id=107520]

The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029

Gardner Vaughan Group breaks ground on first Gold Coast development, Bronze on Chevron

Prominent New Zealand apartment and hotel operator, <a href="/developers/safari-group">Safari Group</a>, is offering up a prime investment opportunity for Australians to purchase off the plan in one of the world’s most popular ski destinations.

They recently took to market Mountain Oak Queenstown Apartments, in the growing precinct of Remarkables Park in Frankton, near the airport and at the foot of The Remarkables - the mountain range the locals like to call “The Remarks”.&nbsp;

Sydney investors have shown interest in the one, two and three-bedroom apartments that secure high-season occupancy six months over the year, primarily over summer and winter months.

They average 90 per cent occupancy across their portfolio over January, February, March, August, November and December, while shoulder season months of April, July, September and October are still occupied 70 per cent of the time, with the growing appeal of Queenstown becoming not just a hotspot for the snow, but a lifestyle destination.

Even in the low seasons of May and June, occupancy levels reach around 40 per cent.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_auto/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Ext_Cam15_Sunny.jpg?VersionId=SJAROUM_1s.Tr5ciMk4EEj5oAt_Vewmv" />

Safari’s Safari Hotels arm can also manage the holiday letting for an investor, from the listing on holiday accommodation websites such as Airbnb and Booking.com to the cleaning and maintenance of the investment. They’ve been in the short stay management business for 15 years and offer 24/7 support for investors, an important convenience benefit for any overseas investor

Another major drawcard for Australians is that New Zealand doesn’t have a stamp duty policy - so the entry price of NZ$639,000 (AU$586,000), is all that is payable on completion.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/313_Livingv2_WEB.jpg?VersionId=nV229fM0ZeYpoxOrX372HyGjfwY_LR8c" />

Safari is starting construction of the 141 apartments in Q2 this year, with a two-year build estimated to complete in mid-to-late 2027.<img alt="" data-entity-type="" data-entity-uuid="" height="15" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXczFpFAb7WuA6f4f9TtKWcqXyNwR8qqtakWv352ERkpqNlP3KwIo8YKxw67jZNHfpjEGIZGv5MQTbnvLZwNt8iu9IVdOrswOjCvBZ4zhSoOOLrpt6etVEZTN1gkBho0r_R72zdHNA?key=yq3daOanqHSb88QFd8jGYKdb" title="Click and drag to move" width="15" />​

The apartments will feature modern amenities and contemporary designs with expansive windows capturing sweeping views of The Remarkables mountain range.&nbsp;

Interiors are equipped with modern finishes, premium appliances, and secure electronic key-locked doors, ensuring a comfortable living experience for residents and guests alike.

With its strategic location near Coronet Peak and Cardrona Alpine Resort, as well as key retail and dining precincts such as Market Street, Five Mile Shopping Centre, and Remarkables Market, Mountain Oak offers a strong proposition for investors seeking high rental yields and capital appreciation in one of New Zealand’s most sought-after locations.&nbsp;

Queenstown’s sustained demand for visitor accommodation and rental properties is underpinned by a shortage of housing options, attracting both local and international buyers.

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

<html><body>
Sentiment in the Australian commercial property market hit a new high in Q4, but the headline index continues to mask big differences across property sectors and states, according to NAB’s quarterly tracker on the state of the sector.
The NAB Commercial Property Index rose to +17 points in Q4 from +10 in Q3, a new high since it first came out in 2010.
<a href="/images/2016/03/2/Screen%20Shot%202016-03-02%20at%2012.16.02%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/2/Screen%20Shot%202016-03-02%20at%2012.16.02%20PM.png" alt="">
By sector, CBD hotels and office markets are leading the way. NSW and Victoria are also out-performing, but WA is lagging considerably, it showed.
Property professionals noted a deterioration in their funding conditions on both debt and equity fronts in Q4, with tighter credit conditions also reflected in higher pre-commitment hurdles for new developments. 
The improvement in the overall index was led by CBD hotels, followed by office and retail. Sentiment in industrial property markets fell and is now weakest overall. 
Looking ahead, property professionals operating in CBD hotel markets are most confident, which may reflect a shortage of supply and the broader pick up in tourism on the back of the lower AUD, along with a pick-up in business travel. 
<a href="/images/2016/03/2/Screen%20Shot%202016-03-02%20at%2012.15.56%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/2/Screen%20Shot%202016-03-02%20at%2012.15.56%20PM.png" alt="">
Confidence is lowest (albeit positive) among retail property operators, perhaps reflecting expectations that the impetus to household consumption from the housing market will wane through 2016 as house price growth slows. 
The headline Commercial Property Index also continues to hide some very big differences in performance by state. 
“NSW and Victoria remain at the forefront of the improvement in market sentiment, with WA still wallowing in deeply negative territory,” said NAB Group chief economist Alan Oster. 
NSW would remain the most optimistic state for commercial property in the next two years, with Queensland tipped to be the big improver and WA the most pessimistic. 
Survey respondents believe that CBD hotels will provide the best capital returns in the next 1-2 years (4% in each year), followed by office (1% &amp; 1.2%), with significantly higher returns in NSW and Victoria masking further big corrections in WA. Capital returns are expected to be lowest for retail property (0.4% &amp; 0.6%). 
<a href="/images/2016/03/2/Screen%20Shot%202016-03-02%20at%2012.18.46%20PM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/2/Screen%20Shot%202016-03-02%20at%2012.18.46%20PM.png" alt="">
In leasing markets, office property is expected to provide the best returns over the next 1-2 years (0.7% &amp; 1.7%), with rental growth in NSW and Victoria leading the way. In contrast, office rents in WA are expected to continue falling heavily amid elevated and climbing vacancy rates, significant over-supply and weak tenant demand. 
In the national industrial market, the outlook for rents has been pared back a little (0.2% &amp; 0.4%) with rental returns for retail property also softer (0.2% &amp; 0.5%). 
Despite an overall improvement in commercial property market sentiment, the survey reveals that fewer developers are planning to start new works in the short term. 
“Funding issues may be playing a role here, with more developers indicating that their debt and equity funding situations had deteriorated,” said Oster. 
Tighter credit conditions are also being reflected in higher pre-commitment hurdles for new developments - up for the third consecutive quarter to 53.5% in Q4 and expected to tighten further over the next 6-12 months. 
Around 250 panel respondents participated in the Q4 2015 survey, consisting of real estate agents/managers, property developers, asset/fund managers and owners/investors. 
</body></html>

prateek24-ezbwHMbNAk

Sentiment at record high in NAB Q4 commercial property survey  

<html><body>
The Australian Prudential Regulation Authority (APRA) released its December 2015 quarterly data on property exposures by Australian authorised deposit-taking institutions (ADIs).
The data is always interesting to analyse in order to get further insight into the current state of the mortgage market.
The first data point is residential term loans to households which have a total outstanding balance of $1.384 trillion which has increase by 8.9% over the past year. The total value of outstanding owner occupier loans is $884 billion having increased by 12.8% over the past year and accounting for 63.9% of all outstanding loans. The remaining 36.1% of outstanding loans are to investors, having increased by 2.6% year-on-year to $500 billion. 
Growth in outstanding loans has tilted away from investors to owner occupiers.  After year-on-year growth in investor loans peaked at 18.2% in March 2015 it has slowed to 2.6% growth while owner occupier credit troughed at an annual rate of 2.2% in March 2015, before rebounding to the current annual rate of 12.8% (the fastest annual growth rate since June 2010).
<a href="/images/2016/03/Chart-1-3-580x204.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-1-3-580x204.jpg" alt="">
In terms of the types of loans outstanding, 42.3% have an offset facility, 39.3% are interest-only, 0.2% are reverse mortgages, 2.0% are low documentation loans and 0.1% are other non-standard loans.  The year-on-year change across these loan types has been recorded at: +22.0% for loans with an offset facility, +11.6% for interest-only loans, +1.6% for reverse mortgages, -16.6% for low documentation loans and -5.7% for other non-standard loans.  Importantly, the value of outstanding residential loans for low-documentation loans is now at a record low.
<a href="/images/2016/03/Chart-2-3-580x207.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-2-3-580x207.jpg" alt="">
The data highlights that the average outstanding balance on a residential loan is $248,800, up by 1.0% over the quarter and by 4.4% year-on-year.  Reverse mortgages ($95,700), low-documentation loans ($192,800) and other non-standard loans ($195,900) all have much lower outstanding balances.  Meanwhile, loans with offset facilities ($303,700) and interest-only loans ($330,000) have significantly higher outstanding balances. 
The year-on-year changes to the outstanding loan balances have been recorded as follows: +7.2% for loans with an offset facility (fastest year-on-year growth since June 2011), +4.9% for interest-only loans, +2.8% for reverse mortgages (slowest year-on-year growth on record), -1.5% for low-documentation loans and -6.8% for other non-standard loans.  The data shows a slowing in the growth of outstanding loan values for reverse mortgages while riskier lending types (low-documentation and other non-standard) have seen an ongoing fall in outstanding loan amounts.
While the previous data looked at the total value of residential mortgages outstanding, the following data focuses on new residential mortgages over the final quarter of 2015.
Over the December 2015 quarter there was a record-high $98.130 billion worth of new residential mortgages approved, $69.091 billion worth were owner occupied with the remaining $29.040 billion being for investment purposes.  Year-on-year the value of new owner occupier loans is 28.8% higher, its greatest change on record, while investor mortgage lending is -24.9% lower, its largest fall on record.
<a href="/images/2016/03/Chart-3-3-580x212.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-3-3-580x212.jpg" alt="">
Looking at the types of mortgages approved over the quarter: a record low 0.3% were low-documentation, 37.0% were interest only which was its lowest proportion since March 2013, 0.1% were other non-standard loans, 47.4% were originated by third parties and 3.7% were loans approved outside of serviceability.
Focussing on the year-on-year change; low documentation loan approvals are -41.8% lower (their largest year-on-year fall since March 2013), interest-only loan approvals are -11.0% lower (their largest year-on-year fall since March 2009), other non-standard loan approvals are up 28.2% (their largest year-on-year increase since December 2013), third party originated loans are up 6.2% and loans approved outside of serviceability are up 41.3%.  The data indicates there has been a significant pull-back in low-documentation loans and interest-only loans. 
At the same time, non-standard and loans approved outside of serviceability are rising significantly which may be a potential point of concern for APRA.  Although they make-up a small overall proportion of lending it will be something to keep a close watch on over the coming quarters especially since both have also recorded a quarterly increase.
<a href="/images/2016/03/Chart-4-3-580x207.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/Chart-4-3-580x207.jpg" alt="">
Finally the data breaks out new lending by loan-to-value-ratio (LVR) bands.  Over the quarter, 23.4% of all new loans had an LVR of less than 60%, 53.4% had an LVR of between 60% and 80%, 14.5% had an LVR of 80% to 90% and 8.7% had an LVR of more than 90% which was its lowest proportion on record. 
Looking at the year-on-year changes, the value of lending for LVRs of less than 60% was 16.1% higher, LVRs of between 60% and 80% increased 6.1%, LVRs of 80% to 90% increased 14.3% and LVRs greater than 90% fell by -20.1% which was the largest year-on-year fall June 2010.  Based on the data it is clear that lenders have been tightening lending requirements over recent quarters which has led to a sharp decline in new mortgage lending for LVRs above 90%.
Overall the data indicates that the market is responding to regulatory changes in the lending space implemented over the past year.  There is less new lending to high LVRs, fewer low documentation and interest-only mortgages being written. 
On the other-hand some other potentially more risky lending types such as non-standard and outside of serviceability loans are continuing to rise.  It will be interesting to see whether APRA starts to look to crack-down on some of these types of lending in order to ensure stability within the mortgage market.
Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
</body></html>

ckusher-ujnxiKuFQs

APRA data shows a further tightening of lending standards: Cameron Kusher

<html><body>
The Reserve Bank of Australia released its Financial Aggregates data for January 2016, which showed credit growth of +6.5 percent in the year to January 2016, a steady increase on the +6.1 percent recorded for the year to January 2015.
<a href="/images/2016/03/RBA2.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/03/RBA2.jpg" alt="">
<div>Total annual housing credit growth has slowed a bit from its recent peak of +7.47 per cent in November 2015 to +7.33 per cent in January 2016, reflecting in part the shift in composition of lending from investors to owner-occupiers. </div>
<div> </div>
<div>Investor credit growth is now well below APRA's arbitrary +10 per cent threshold at just +7.9 per cent and consistently slowing from +11 per cent in June, meaning that theoretically major banks could in due course start to ramp up lending into this sector should they feel the urge to do so. </div>
<div> </div>
<div>Of course, any such move would be dependent upon a range of regulatory factors, and whether APRA has the appetite to loosen its throttle. Meanwhile owner-occupier annual credit growth recorded another significant jump in surging to a 64 month high of +6.95 per cent, with homebuyers looking to take advantage of attractive mortgage rates.</div>
<div> </div>
<div><a href="/images/2016/03/RBA1.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA1.jpg" alt=""></div>
<div> </div>
<div>Deposit growth seems to present few headaches for banks right now. While term deposits have been understandably less popular in the prevailing low interest rate environment, total deposits with banks have expanded in a robust manner over the year to January. </div>
<div> </div>
<div><a href="/images/2016/03/RBA3.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA3.jpg" alt=""></div>
<div> </div>
<div> </div>
<div>
<div>Business credit</div>
<div> </div>
<div>Business credit grew by +6.2 per cent in the year to January 2016, up from +5.5 per cent in the year to January 2015. It is as yet unclear whether this is the end of the uptrend for business lending growth, or a blip in the upwards trajectory. </div>
<div> </div>
<div><a href="/images/2016/03/RBA4.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA4.jpg" alt=""></div>
<div> </div>
<div>
Housing credit The chart below shows how lenders in the housing market have conveniently managed to shift almost seamlessly away from investment lending to owner-occupier credit, with a bit of reclassification jiggery-pokery along the way. In fact, the data submitted by lenders makes it look as though the chart has been drawn up on an Etch-A-Sketch.
</div>
<div> </div>
<div><a href="/images/2016/03/RBA5.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA5.jpg" alt=""></div>
<div> </div>
<div> </div>
<div>
<div>Total housing credit continued to push beyond $1.53 trillion, growing at an annual pace of +7.33 per cent, although naturally there are marked differences between the states and capital cities, with some faring much better than others. There have been a few pro-equities articles today discussing "plummeting" lending and investors "leaving the market in droves". That's interesting, but it's not what I'm seeing. Don't forget that housing credit expanding at a pace of +7 per cent implies a doubling in outstanding credit over a decade. It's all in the marketing, I guess.</div>
<div> </div>
<div><a href="/images/2016/03/RBA6.jpg" target="_blank">Click to enlarge</a></div>
<div><img src="/images/2016/03/RBA6.jpg" alt=""></div>
<div> </div>
<div>
<div>The wrap</div>
<div> </div>
<div>Credit growth was fairly steady in January, with owner-occupiers continuing to pick up the baton from investors within the housing sector.</div>
<div> </div>
<div>A key question going forward will be whether having managed to push investor credit growth below its preferred +10 per cent threshold APRA releases its grip on investor lending at all. </div>
<div> </div>
<div>As APRA's data last week showed, the overwhelming majority of property buyers these days have substantial deposits, the question is whether tougher criteria are to be maintained surrounding mortgage serviceability. </div>
<div> </div>
<div>Another key factor could be movements in the cash rate, with interest rate cuts potentially set to stimulate demand for mortgage borrowing further, although it appears likely that lenders would hold back 10bps to15bps of a prospective 25bps interest rate cut.</div>
<div> </div>
<div>Adding to the parts of GDP we already know such as net exports, the Business Indicators released by the ABS this morning including inventories (-0.4), wages (+0.5), and company profits (-2.8), each suggested that headline GDP growth for the fourth quarter of 2015 is likely to be weak. </div>
<div> </div>
<div>These GDP partials may prove to be another tack in the coffin for the next movement in interest rates being down. </div>
<div> </div>
<div>
PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>. 
His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.
</div>
</div>
</div>
</div>
</body></html>

pwargent-M4siyDbqQY

Owner-occupiers lead housing lending: Pete Wargent

<html><body><div class="article__content">
<div class="parsys parsys-article-content-top">
<div class="cq-article-content-paras section">
East coast residential developer Sunland reported a dip in net profit to $3.2 million but has reconfirmed full-year earnings of up to $29 million, given anticipated second-half property settlements.
Sunland managing director Sahba Abedian said he had also noticed a cyclical pull-back in bank lending for new properties.
"I do feel there is some adjustment taking place where banks are becoming more stringent on their lending, and that is in respect to lending to developers as well," Mr Abedian said. 
"I think it is partly regulation, but I also feel they have a view to the cycle," the Australian Financial Review reported.
"Despite the prevailing headwinds, we continue to see opportunities in specific market segments in Brisbane, the Gold Coast and Sydney's northern beaches, and our recent acquisitions in these locations are expected to contribute to earnings growth in the short to medium term."
Sunland has a total of 855 contracts on hand with a combined value of $663 million, with an estimated 380 settlements during the second half of the year.
He said a sustained focus on operational efficiencies enabled the group to achieve an average return on development of 25 per cent, above a target of 20 per cent.
 
</div>
</div>
</div></body></html>

jchancellor-FAypfDUnLy

Sunland secures 25 percent returns on its residential development

<html><body>
This week marks the fourth consecutive week of the combined capital city clearance rate being above the 70 percent mark, with the stronger than expected auctions results continuing through the final week of February.  
Capital city auction results haven’t recorded a four week period where the clearance rates was consistently higher than 70% since early September last year.  Based on 2,113 reported results, the preliminary clearance rate across the combined capitals was 72.4 percent this week, having strengthened from 71.8 percent last week when 2,347 auctions were held.
Auction activity continues to pick up with 2,620 auctions scheduled this week; however is yet to reach the same levels seen at the same time last year which is more than likely attributed to Melbourne’s Labour Day public holiday falling a week later this year.
Last year’s final auction clearance rate for the week was 76.4 percent across a total of 3,238 auctions. The robust rate of auction clearance, together with the CoreLogic Home Value Indices continuing to show a moderate rate of growth through February suggest housing markets are continuing to demonstrate a controlled slowdown rather than any signs of a sharp correction.
<a href="/images/2016/02/29/Screen%20Shot%202016-02-29%20at%209.13.44%20AM.png" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/Screen%20Shot%202016-02-29%20at%209.13.44%20AM.png" alt="" width="800" height="427">
 
Melbourne’s preliminary clearance rate this week is 75 percent, up from 74.1 percent last week, but lower than the 77.1 percent of properties that sold at the same time last year. This week 1,327 residential homes were taken to auction, having increased from 1,105 the previous week. 
At the same time last year 1,565 Melbourne auctions were held, however volumes were higher due to the scheduling of the Labour Day weekend the following week. Melbourne’s top performing sub-region this week was the Inner South, where both a high volume of auctions were held (224) and the strongest clearance rate achieved at 83.9 percent. Inner Melbourne had the most auctions this week (289), however the clearance rate was the second lowest of any Melbourne sub-regions at 71.8 percent.
<a href="/images/2016/02/29/20160229-Melbourne.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Melbourne.jpg" alt="" width="800" height="541">
 
This week Sydney’s preliminary auction clearance fell to 73.3 percent, following on from the previous week’s result of 76.5 percent. There were 872 auctions held, rising from 800 last week, but lower than the 1,223 over the comparable week one year ago. A higher proportion of auctions were successful this week in Sydney’s Eastern Suburbs (86.9 percent) and Ryde (81.6 percent), however the most auction activity occurred in North Sydney and Hornsby with 173 auctions.
<a href="/images/2016/02/29/20160229-Sydney.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Sydney.jpg" alt="" width="795" height="541">
 
The number of Brisbane homes taken to auction this week was similar to last week, with 175 held, compared to 172 the previous week. The preliminary auction clearance rate strengthened to 58.3 per cent this week, having risen from 53.1 per cent. Compared to the final months of 2015, Brisbane’s clearance rate so far this year has been consistently stronger. This week 43 Gold Coast auction results have been reported with a preliminary clearance rate of 48.8 per cent.
 
<a href="/images/2016/02/29/20160229-Brisbane.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Brisbane.jpg" alt="" width="788" height="527">
 
There were 118 Adelaide auctions held this week and preliminary results show a success rate of 72.7 per cent after having dipped to 64.6 per cent last week when 112 auctions were held. One year ago 109 Adelaide homes were taken to auction with a strong clearance rate of 76.7 per cent.
<a href="/images/2016/02/29/20160229-Adelaide.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/20160229-Adelaide.jpg" alt="" width="799" height="545">
 
The number of Perth homes taken to auction this week remained steady, with 47 scheduled auctions compared to 42 last week and 46 the previous week. Preliminary results show the cities clearance rate sitting at 44.4 per cent.
Across Canberra, 72 homes were taken to auction this week. Preliminary results show a clearance rate of 69.6 per cent, up from 61.9 per cent the previous week.
So far 5 Tasmanian results have been reported with 3 sales.
</body></html>

smiller-vwPjRHTkST

Capital city clearance rate remains above 70% for the fourth consecutive week: Shana Miller

<html><body>
Dwelling rental growth is now at its lowest level on record according to the first CoreLogic RP Data Rental Review for 2016. Currently the median rent rate is recorded at $443 across the combined capital cities. 
CoreLogic RP Data has tracked annual rental changes since 1996 and over that time, rental growth conditions have never been weaker. At the same time last year rental rates had increased by 1.7 percent highlighting that the slowdown in rental conditions has been sharp over the year.
A combination of factors is affecting the national rental market. Among these is a higher level or rental stock resulting in greater options for renters, a slowdown in population growth, higher than normal investment activity and stagnant wage growth. 
More rental stock at a time when demand is easing due to slowing population growth, and little wage growth for renters, has resulted in flat rental growth conditions over the past year. 
For renters there is a lot more accommodation options in the market while simultaneously, landlords are now required to respond to a more competitive environment which, in many cases means keeping rents steady or in some areas reducing rents in order to keep a tenant. 
CoreLogic RP Data analysis shows rents across the combined capitals rose by 0.2 percent in January 2016. The only capital cities to see a rise in rents over the month were Sydney, Melbourne, Adelaide, Hobart and Canberra, elsewhere rents dropped. 
Across the individual capital cities, over the past year: 
Rents increased in Sydney (+1.4 percent), Melbourne (+2.1 percent), Hobart (+0.1 percent) and Canberra (+1.8 percent). 
Rental rates have fallen over the past year in Brisbane (-0.7 percent), Adelaide (-0.4 percent), Perth (-8.6 percent) and Darwin (-13.4 percent). 
Across every capital city except Canberra the rate of annual rental growth or decline is currently lower than it was a year ago indicating that the weaker rental market conditions are prevalent across most capital cities. 
Rental Market Update: 
Weekly rents across the combined capital city measure increased 0.2 percent over the month of January however they were unchanged over the past 12 months. 
Currently, combined capital city rental rates are $487/week for houses and $465/week for units. 
It is possible that over the coming months, rental rates could begin to fall on an annual basis due to additional new rental supply entering the market.
 
Cameron Kusher is research analyst for CoreLogic RP Data. You can contact him <a href="https://blog.corelogic.com.au/about/">here</a>.
</body></html>

Softest conditions on record for capital city rental markets: Cameron Kusher

<html><body>
According to the just-launched CoreLogic-Moody’s Analytics Australian Forecast Home Value Index, home values are forecast to continue rising solidly in Sydney and Melbourne over the next decade. 
<a href="/images/2016/02/29/Modys.jpg" target="_blank">Click to enlarge</a>
<img src="/images/2016/02/29/Modys.jpg" alt="">
 
<div>It sees annual price growth of more than +5 per cent returning for Perth by 2017, but subdued growth for Adelaide over the next two years, while Darwin prices are expected to decline in 2016.</div>
<div> </div>
<div>Of the capital cities, Brisbane is forecast to fare best over the next two years with home value growth of around +12 per cent.</div>
<div> </div>
<div>
PETE WARGENT is the co-founder of <a href="https://allenwargent.com/" target="_blank" rel="nofollow">AllenWargent</a> property buyers (London, Sydney) and a best-selling author and <a href="https://petewargent.blogspot.com/" target="_blank" rel="nofollow">blogger</a>. 
His latest book is <a href="https://www.bigskypublishing.com.au/Books/General-Interest/Four-Green-Houses--and-a-Red-Hotel/1015/productview.aspx" target="_blank" rel="nofollow">Four Green Houses and a Red Hotel</a>.
</div>
</body></html>

10 year home price forecast for Sydney: Pete Wargent

<html><body>
The hotel industry was characterised by mixed fortunes in 2015, with the second half continuing the trend from the first, according to Deloitte Access Economics' Tourism and Hotel Market Outlook.
Sydney had the country's highest hotel occupancy at 88%, with a room rate growth of 8.8% annualised for the second half of the year, signalling that room rate growth expected to accompany such lofty occupancies is finally materialising.
Across Australia, room nights sold were up 3.3% from the 2.5% observed over the year to June. National room rates growth similarly accelerated over the second half of the year.
Fortunes were mixed across the major markets, with key outlook highlights:
- While rates in Melbourne grew 4.5% for the year, 93% occupancies in November were a record for the city
- Hobart, a market an eighth the size of Melbourne by turnover, recorded the same feat in the same month
- Queensland’s beaches posted the biggest gains in occupancy, with the Gold Coast and Tropical North Queensland recording increases of 3.0% and 4.8% respectively from a year earlier, although the latter was due to some properties being taken out of service for renovation
- Mining hubs lagged as supply increases combined with softening demand to drag both occupancy and room rates lower in Brisbane, Perth and, especially, Darwin
- Brisbane hoteliers, who had a good run during the G20 meeting at the end of 2014 with room rates at record highs, struggled to see growth for most of 2015
- Despite significant supply increases, the Darwin market effectively contracted 8.4% over 2015, as measured by total takings
- Canberra was the quiet achiever, where additions to supply masked 10% growth in room nights sold.
Hotel market outlook
Looking forward, 64 properties are due online before the end of 2018 across the nine major hotel markets analysed in the outlook. This represents a significant increase in the supply pipeline from Deloitte's August 2015 report, with the new room count up 12% in likelihood adjusted terms. Another 30 projects are mooted for regional hotel markets, although many are in the 50-room category.
Activity is not limited to additions in supply, with transaction volumes well up on previous years. Sixty-two existing hotel sales were recorded in 2015, with an aggregate value of AU$3.77bn, AU$1.2bn more than 2014.
Key Outlook forecast points, include:
- 8,650 rooms are expected to be added to the nation’s major hotel markets, and a further 3,900 in other regional markets, over the next two-and-a-half years, pushing supply higher at an average annual pace of 1.7%
- The supply growth outlook is led by Perth, with likelihood-adjusted expectations of an additional 1,900 rooms by the end of 2018
- Hobart has nine properties in the pipeline, and will undergo its own small boom in hotel construction, with room nights available increasing at 5.6% per year
- Over the next three years, supply growth is expected to be healthy, but more moderate, in Brisbane (4.1% per year) and Adelaide (4.0% per year)
- In Sydney and Melbourne, where 90% average occupancy is in sight, supply is still forecast to trail demand despite a number of high profile projects coming onto the market over the next three years
- Of any market, the relative growth prospects have improved most for Canberra given its hotel stock upgrades and refurbishments, and the expected arrival of direct international flights from Singapore and Wellington
- The projected national performance outlook remains one of demand growth (3% per year) outstripping supply growth (1.6%) and occupancies forecast to climb 2 percentage points to just above 71% by December 2018.
“The range of forecast performance across markets is widening as the sector’s growth drivers shift. With corporate travel following the nation’s economic transition back to the south east, so too is short stay accommodation demand, in turn putting further pressure on the already stretched Melbourne and, particularly, Sydney markets," Deloitte Access Economics partner Lachlan Smirl said.
“At the same time, a resurgent domestic leisure segment is buoying demand for holiday hot spots from Tasmania to Queensland’s beaches and emerging Asia continues to propel markets successful in luring these high growth segments."
The Gold Coast is projected to post the largest occupancy gains leading up to the 126,000 visitors expected for the Commonwealth Games in April 2018.
</body></html>

Sydney leads hotel occupancy, rest share mixed fortunes in 2015 second-half: Deloitte study 

<html><body>
Our prediction in 3-4 months ago about Melbourne overtaking Sydney has been confirmed by the latest price data.
In one of our November reports we noted: “Melbourne is the new star of Australia’s capital city property markets. It’s only a matter of time before Melbourne overtakes Sydney as the price growth leader in capital city Australia.”
We reported then that Melbourne continued to deliver a large number of growth markets, while Sydney was steadily waning. In Hotspotting’s latest survey for the Price Predictor Index, Melbourne continues to record strong sales activity, even though the number of rising suburbs is gradually diminishing. 
The number of Melbourne suburbs with rising sales trajectories in the past four quarterly surveys has been 134, 113, 110 and 105. This suggests Melbourne has passed its peak in terms of sales activity, but still has good impetus, while the price peak will probably come later in the year. 
The best of Melbourne’s precincts continue to be a mix of middle and outer-ring suburbs, with growing evidence that the previously-strong markets in the Top End near-city areas have subsided. 
Areas dominated by Top End suburbs – such as the LGAs of Glen Eira (Bentleigh, Caulfield, McKinnon), Boroondara (Balwyn, Ashburton, Glen Iris) and Stonnington (Armadale, Malvern, Prahran) – now have mostly Plateau markets, which are suburbs where sales activity has reached a peak and started to taper off at those levels or slightly lower levels (i.e. no longer rising). 
But there are numerous strong middle-market areas – notably the municipalities of Whitehorse (Box Hill, Nunawading, Blackburn), Banyule (Macleod, Montmorency, Watsonia), Moreland (the Brunswick and Pascoe Vale suburbs) and Bayside (Beaumaris, Black Rock, Hampton) – with significant numbers of growth suburbs. 
Whitehouse, previously a clear leader in the Melbourne market, has faded a little and is now matched by the LGAs of Banyule, Moreland and outer-ring Casey in terms of suburbs with rising trajectories. 
Other previous contenders Monash (Oakleigh, Mt Waverley, Clayton) and Knox (Wantirna, Boronia, Bayswater) have waned somewhat and, like Whitehorse, now have more Plateau markets than rising ones.
But there is now considerable energy in markets in the outer ring precincts. Locations likely to attract first-time buyers and others on smaller budgets are really pumping in Melbourne. 
In the far south-east, the Casey LGA (Cranbourne, Doveton, Endeavour Hills) matches those leading middle-market areas for the number of growth suburbs. 
Close behind are Brimbank (Sunshine, Deer Park, Cairnlea) in the western suburbs and Whittlesea (Epping, Thomastown, Mill Park) in the north of the metropolitan area. 
Market up-cycles often start in or near the city centre, with the millionaire suburbs the first to experience a rise in activity. As the cycle progresses, the growth ripples out to the middle-ring areas and latterly to the outer-ring suburbs. It’s common for the cheaper areas to have the greatest growth in the latter stages of the cycle, which often is in the third year of heightened activity. 
Sydney’s recent boom generally followed that pattern and Melbourne’s period of busy market activity (without producing the same high level of price growth across the whole city) has done likewise. 
So the evidence suggests that Melbourne is the leading capital city market - although it has passed or is close to its peak, depending on how you measure these things.
I note that the latest NAB Quarterly Residential Property Index finds that Victoria (read Melbourne) has replaced NSW (read Sydney) as the state with the most positive market sentiment and is currently the only state tracking above its long-term average. 
It’s also worth noting that Melbourne is Australia’s leading city for long-term capital growth (the average annual growth in prices over the past 10 years). 
Melbourne gets a lot of its impetus from population growth - it’s the leading capital city both for overseas migrants and for net inflow from interstate migration - and many of the leading suburbs for long-term capital growth are those that attract migrant buyers.
 
Terry Ryder is the founder of <a href="https://www.hotspotting.com.au/" target="_blank">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or follow him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter.</a>
</body></html>

terryryder-YECXbqmri2

Where Melbourne is pumping: Terry Ryder

<html><body>
Boutique advisory firm Moelis &amp; Co is closing in on a deal to buy pubs portfolio Redcape Hotel Group, according to the well-placed Street Talk column in the Australian Financia Review.
It is understood Moelis and Redcape have signed a heads of agreement, which will allow final due diligence.
Moelis reduced its offer for Redcape earlier this month after share market volatility meant the initial public offering was off the table.
It was suggested the current offer price is around $620 million compared to $650 million.
An ASX listing was considered last year with hedge funds York Capital and Varde Partners cashing out. 
Redcape owns 23 pubs in NSW.
</body></html>

Latest Investing Insights

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

Editor's Picks

Developments

New apartments

New townhouses

News

Latest Investing Insights

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

Editor's Picks

Receive the latest news stories to your inbox

Developments

New apartments

New townhouses

News