Malaysian developer <a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> is the latest to jump into St Leonards booming Transport Oriented Development precinct.

The developer, which has previously delivered Sapphire by the Gardens apartment development in Melbourne, identified the Atchison Street site in 2023. It filed a Scoping Report around 12 months ago, and now has revealed the designs for the new&nbsp;40-storey mixed-use tower.

The State Significant Development Application covers <a href="https://next-portal.urban.com.au/projects/14650/summary">20-22 Atchison Street</a>, a 1,374 sqm site positioned between St Leonards Station and the new Crows Nest Metro station.

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the project would deliver 181 apartments, above a four-storey commercial podium, five basement levels, and new public domain works along Mitchell Street. The apartment mix comprises 35 one-bedroom apartments, 39 one-bedroom-plus-study apartments, 85 two-bedroom apartments, and 22 three-bedroom residences.

The proposal has been lodged as a shop-top housing development under the NSW Government’s TOD planning pathway, which allows increased density around key transport infrastructure. The site sits within the recently rezoned Crows Nest Accelerated TOD Precinct.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b799673d-48e2-46b0-801a-0e33a9330100" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20site.png?VersionId=dPh0UfwfaHpbFL1R7H1cbZNbIW0CHbCC" />

SP Setia acquired the Atchison Street site as part of its continued expansion into the Australian apartment market. In comments made to City &amp; Country (The Edge Malaysia) in 2023, SP Setia President and CEO Datuk Choong Kai Wai described the acquisition as “a strategic move” aligned with the group’s post-pandemic market recovery strategy.

“Our target for this exceptional development is local and overseas buyers, including first-home buyers, downsizers and investors,” Choong said.

The tower has been designed as a slender vertical form rising from a mixed-use podium, with COX Architecture positioning the development as a response to the evolving St Leonards and Crows Nest skyline.

“The purpose of the project is to facilitate the delivery of high-quality housing at a strategically located site and deliver a built tower outcome that is consistent with the desired future character of St Leonards and aligns with the TOD controls,” the design report stated.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="b1a85eee-76f7-436c-a6da-73ba827b9b13" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/atchinson%20entry.png?VersionId=dA9jHGPMcm.dDbwk4QfxqWiY5bfh3UVt" />

The podium would incorporate retail uses fronting Atchison Street, commercial tenancies, landscaped communal areas, and pedestrian improvements along Mitchell Street. Vehicle access and loading would be consolidated via Atchison Lane.

Residents would have access to more than 665 sqm of communal indoor and outdoor spaces, while the development proposes 96 parking spaces across five basement levels.

The proposal also includes a commitment for 10 per cent of residential floor space to be allocated toward affordable housing through a monetary contribution.

COX said the tower form responds directly to the emerging high-density character of the precinct while seeking to maximise solar access, cross ventilation, and outlook from apartments.

<img alt="First look: SP Setia targets St Leonards skyline with 40-storey TOD tower" data-entity-type="file" data-entity-uuid="2163f85c-f63b-4be3-aafa-f8763976cec5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_5.png?VersionId=WiAmtIKJ6.ZQ41EtYEQ1fol7AeorKBlL" />

“The building is orientated towards north,” the Apartment Design Guide compliance report noted, adding that the tower’s slim form was driven by the constrained inner-urban site dimensions.

The design also incorporates landscaped setbacks and communal open space at podium level, intended to soften the interface with surrounding streets and improve pedestrian amenity.

The project adds to a growing wave of redevelopment proposals reshaping St Leonards and Crows Nest following the opening of the Sydney Metro City line and the NSW Government’s push for higher-density housing around major transport nodes.

Last week Stockland filed plans just down the road. They want to build a <a href="https://www.apartments.com.au/new-apartments/601-pacific-highway-st-leonards-nsw-2065">52-storey tower on Pacific Highway</a>.

Read more:&nbsp;<a href="https://www.apartments.com.au/news/nsw/first-look-stockland-plans-52-storey-538-apartment-st-leonards-tower">First look: Stockland plans 52-storey, 538-apartment St Leonards tower&nbsp;</a>

Joel Robinson

First look: SP Setia targets St Leonards skyline with 40-storey TOD tower

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> has revealed plans for a new mixed-use tower at 10 Dangar Street, Wickham, advancing a proposal that would reshape the southern gateway to Newcastle’s city centre with one of the city’s tallest residential buildings.

The State Significant Development proposal, now on exhibition, seeks approval for a <a href="https://www.apartments.com.au/new-apartments/bowline-10-dangar-street-wickham-nsw-2293">43-storey tower</a> immediately adjacent to the Newcastle Interchange. The project would deliver around 200 apartments, including 42 affordable housing dwellings, alongside 99 co-living units, a 171-room hotel, retail space, and new public domain integrated through the site.

The scheme marks a significant escalation of plans previously approved for the site. Urban Property Group took over the prominent 2,904 sqm parcel, where excavation and demolition had already commenced under an earlier consent for a 14-storey mixed-use development.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="58a96dd9-407f-4d20-86b4-94e4bfeef74b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20podium.png?VersionId=LGlf08pdFGAZDzvx_CXC4XakHNZRuEE0" />

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a>, the tower has been conceived as a landmark transit-oriented development anchored to the Newcastle Interchange precinct. The proposal includes 245 build-to-sell apartments across a mix of one, two, and three-bedroom residences, as well as two penthouses. Fifteen apartments and one operational unit are earmarked for NDIS housing. The co-living component would add a further 99 units, while the podium would accommodate retail uses and hotel facilities.

SJB said the site presents “a valuable opportunity to anchor the precinct by setting the standard for design, active ground planes and character at the key southern gateway.”

The architecture responds directly to the site’s position beside major transport infrastructure and within one of Newcastle’s fastest-evolving urban renewal precincts. The tower form sits above a sculpted podium designed to frame new public spaces, including a through-site pedestrian link connecting Station Street to Hannell Street, landscaped plazas, and activated retail edges.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="a7bd6ff0-f7db-4ce8-a6dc-ea56e72c6149" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20lanne.png?VersionId=xzf39VADyhj7zBQY2I9fx9vI62u2tuSb" />

The design report describes the project as part of the broader transition of Wickham into “a vibrant, high-quality mixed-use urban precinct” that leverages proximity to the station, open space, and regional connectivity.

A detailed public art strategy has also been prepared for the development. The strategy positions the project as “a transit-oriented development of state significance at the gateway to Newcastle’s city centre” and outlines a series of integrated artworks responding to Newcastle’s industrial and transport heritage.

Creative Road’s curatorial framework for the project, titled Unveil, draws on “stratified surfaces, carved volumes, and light-filled apertures” while referencing Newcastle’s transformation from an industrial city into a contemporary education and technology hub.

<img alt="First look: Urban Property Group unveils Newcastle’s next supertower at Wickham interchange" data-entity-type="file" data-entity-uuid="77a882bb-14b1-4d28-99ff-9438e39508c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/wickham%20site.png?VersionId=cevgo_vN0eKPK78P8YcEu3mKPLkpFqE7" />

The proposal is being advanced through the NSW Housing Delivery Authority pathway after being declared State Significant Development in June 2025. The accompanying scoping report states the development aims to “maximise the site’s proximity to the Newcastle Interchange by delivering transit-oriented development” while increasing housing supply and affordable housing provision within the Newcastle LGA.

Urban Property Group’s plans align with the long-term strategic vision established under the Wickham Master Plan, which identified the interchange precinct as suitable for substantial uplift in height and density. The current proposal would significantly intensify that vision, positioning the tower among the tallest developments proposed for Newcastle.

The site sits immediately north of the Newcastle Interchange, bounded by Dangar Street, Hannell Street, and Charles Street. It is surrounded by a rapidly growing cluster of residential towers and mixed-use projects that have emerged following the completion of the light rail and transport interchange.

First look: Urban Property Group unveils Newcastle’s latest tower at Wickham interchange

Bottega House has completed settlement of a landmark riverfront site in Macquarie Street, St Lucia, representing its first major Brisbane development.&nbsp;

Positioned on the banks of the Brisbane River, the <a href="https://www.apartments.com.au/new-apartments/180-macquarie-street-st-lucia-qld-4067">premium site at 180 Macquarie Street</a> features uninterrupted river frontage in one of Brisbane’s most tightly held residential precincts.&nbsp;

The proposed development, currently under assessment with Brisbane City Council, has been designed by <a href="https://www.apartments.com.au/architects/plus-studio">Plus Studio</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/mim-design">Mim Design</a> and will deliver a boutique collection of premium residences positioned specifically for owner occupiers and downsizers.&nbsp;

The residences are set to redefine luxury apartment living in the area, with a focus on architectural quality, refined finishes, landscape integration and elevated amenities including curated wellness facilities, resort-style pools and recreation spaces rarely seen in the local market.&nbsp;

Exclusive sales for the project will be led by Keenan &amp; Byrne, ahead of an anticipated launch later this year.&nbsp;

Bottega House Managing Director Nick Malloch said the project reflects the group’s ambition to deliver a highly curated residential offering within one of Brisbane’s most tightly held precincts.&nbsp;

“This is an incredibly rare riverfront opportunity and one we have approached with a long-term perspective,” Malloch said.&nbsp;

“Our vision from the outset was to create a boutique collection of residences that feel more like private homes than traditional apartments, with generous proportions, refined finishes and exceptional amenity throughout."

Malloch says there is a&nbsp;lack of premium owner-occupier stock of this quality in the market, particularly for downsizers wanting space, privacy and a true lifestyle offering without compromise.&nbsp;

"Demand is expected to be strong given the scarcity of premium riverfront opportunities of this nature within Brisbane’s inner-west."&nbsp;

Bottega House secures landmark riverfront site in St Lucia 

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The arrival of the first piling rig officially marks the commencement of construction at SIERA’s new beachside apartment development, Exhale, in Northcliffe.

<a href="https://www.apartments.com.au/new-apartments/exhale-surfers-paradise-8-enderley-avenue-surfers-paradise-qld-4217">Exhale</a>, a glass-encased tower featuring 54 large-scale apartments at 8 Enderley Avenue, is SIERA’s third Gold Coast development. It follows the recently completed PIPIS Bilinga beachfront project, which achieved suburb-record prices, and the soon-to-be-completed Chevron Island development, Tapestry.

[smartcode_project:default project_id=112661 project_image_fid=359603]

<a href="https://www.apartments.com.au/developers/siera">SIERA</a> Founder and Managing Director Brent Thompson said the arrival of the piling rig represented a significant milestone for the development, which is scheduled for completion in late 2028.

Over the next month, around 260 piles are expected to be installed as work progresses on the basement structure. The building is anticipated to rise above ground level early next year, before unveiling its sculptural glass curtain wall, developed in collaboration with specialist façade engineers.

“The façade was designed to maximise panoramic coastal views while creating a distinctive architectural identity,” Thompson said.

[smartcode_project:default project_id=112661 project_image_fid=355935]

Designed by BDA Architecture, Exhale will comprise just 54 two- and three-bedroom residences across 26 levels, a level of low-density living rarely delivered in this beachside pocket between Surfers Paradise and Broadbeach.

The project has been conceived as a resident-only building, with no short-stay accommodation permitted. SIERA says the model is intended to appeal to long-term owner-occupiers rather than transient holiday demand.

[smartcode_project:default project_id=112661 project_image_fid=361052]

Residences have been designed with large-format layouts and expansive glazing, with most apartments featuring more than 30 metres of glass frontage to maximise natural light and ocean views.

The amenity offering spans two levels and centres on wellness and lifestyle, including a heated magnesium pool, sauna, yoga and Pilates studio, gymnasium, private dining facilities, cinema lounge, and dedicated surfcraft storage.

[smartcode_project:default project_id=112661 project_image_fid=359607]

More than half of the apartments have already sold. SIERA has also opened a sales gallery for Exhale at its Chevron Island commercial premises, near its Tapestry tower and the site of its second Chevron Island apartment development, which is slated to launch in early 2027.
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[smartcode_project_cta:default project_id=112661]

SIERA kicks off construction at Northcliffe tower Exhale

Local Little Bay residents, along with buyers from premium postcodes across Sydney’s affluent Eastern Suburbs, have dominated purchases in developer-builder Urban Property Group’s first Eastern Suburbs apartment development, <a href="https://www.apartments.com.au/new-apartments/este-little-bay-jennifer-street-little-bay-nsw-2036">ESTE Little Bay</a>.

The $250 million coastal project, one of the first new developments in the area in several years, has proven particularly popular with downsizers, especially those from Coogee and Bondi. One Double Bay downsizer paid $4.7 million for a four-bedroom penthouse, setting a new local apartment price record in the process.

Buyers have been attracted to the combination of coastal tranquillity, premium design and amenity-rich neighbourhood living. The walkable village setting, along with proximity to three of Sydney’s leading golf courses, New South Wales Golf Club, St Michael’s Golf Club and The Coast Golf Club, has also been a key drawcard.

[smartcode_project:default project_id=112343 project_image_fid=352689]

Built across two low-rise buildings designed by <a href="https://www.apartments.com.au/architects/hill-thalis-architecture-urban-projects-pty-ltd">Hill Thalis</a> and set along a lush, landscaped green spine, designed by leading landscape architect <a href="https://www.apartments.com.au/landscape-architect/arcadia-landscape-architecture">Arcadia</a>, ESTE Little Bay offers a collection of one, two, three and four-bedroom residences with interiors by Richards Stanisich.

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a> Sales Director, Tom McIvor said the response to ESTE has been "nothing short of extraordinary."

“Buyers have been quick to recognise ESTE as a rare opportunity to invest in a coastal sanctuary that offers both seclusion and connectivity to the heart of Sydney,” McIvor said.

[smartcode_project:default project_id=112343 project_image_fid=352687]

<a href="https://www.apartments.com.au/project-marketer/srm-residential">SRM Residential</a> Senior Director, <a href="https://www.apartments.com.au/project-marketer/srm-residential">Clayton Ross</a> said the local market has responded incredibly well, driven by ESTE’s exceptional location and the rarity it offers.

“We’ve seen strong interest from a variety of buyer groups, all of whom are drawn to the exclusivity and quality of the build and construction by the 4.5-star iCIRT-rated builder / developer, Urban Property Group. There’s truly nothing else like it along Sydney’s coastline.”

[smartcode_project:default project_id=112343 project_image_fid=352690]

The project also includes robust buyer protections, including Resilience Insurance’s Latent Defects Insurance, providing 10 years of structural cover, and an independent iCIRT-rating of the developer.

“The iCIRT-rating adds another layer of confidence,” Ross added. “Buyers see it as a safeguard for their investment and their lifestyle.” A highlight of ESTE’s offering is its exclusive wellness amenities, including a heated rooftop infinity pool and outdoor heated spa, a state-of-the-art Technogym fitness centre, and a sauna.

<a href="https://www.apartments.com.au/new-apartments/este-little-bay-jennifer-street-little-bay-nsw-2036">ESTE Little Bay</a> is topped out and is on track to complete towards the end of 2026, with residents moving in before Christmas.

[smartcode_project_cta:default project_id=112343]

Eastern Suburbs buyers snap up ESTE Little Bay apartments

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

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In an unusual move, Mission Australia and the Business Council of Australia last year <a href="https://www.theage.com.au/comment/are-we-mature-enough-for-a-genuine-tax-debate-20130825-2sjo9">co-authored a piece</a> calling for a mature and open conversation about tax reform. They joined a chorus of voices, from the <a target="_blank" href="https://www.google.com.au/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=1&amp;cad=rja&amp;ved=0CCwQFjAA&amp;url=http%3A%2F%2Fgrattan.edu.au%2Fstatic%2Ffiles%2Fassets%2Fff6f7fe2%2F187_budget_pressures_report.pdf&amp;ei=RzMdUrPKCsyfiAfN4oCwDw&amp;usg=AFQjCNHinxucpcUF2nYOLPqyHAyZXTAxMA&amp;sig2=j4rxRSdFQWC6xSixmxPS1A&amp;bvm=bv.51156542,d.aGc">Grattan Institute</a>, to the <a target="_blank" href="https://www.pwc.com.au/media-centre/2013/tax-reform-jul13.htm">CEO of PwC</a>, to <a href="https://www.theage.com.au/comment/full-transcript-saul-eslake-20130812-2rsnr">Saul Eslake</a>, all concerned about structural problems with our taxation system. Government revenues are in trouble, in part, because of the looming end of two great economic booms.
We’re all familiar with the tale of the squandered mining boom but a less familiar narrative is that of the squandered baby boom. Baby boomers are now starting to hit retirement age, striking fear into treasury and health bureaucrats worried about the spiralling costs of health-care and age pensions combined with falling tax receipts.
While increased life expectancy contributes to population ageing, the primary cause in the 20th century was falling fertility rates (number of births per woman). This is important in understanding the boom. An increase in the proportion of the population that is retired (old-age dependents) occurs as a result of a decrease in the proportion of the population that are under working age (child dependents). However, there is a lag between the two which means we have an economic sweet spot that is referred to as the “demographic dividend”, where there are fewer total dependents as a proportion of the population (see the area between the dashed lines in Figure 1).
<a style="font-size: 0.8em;" href="https://c479107.ssl.cf2.rackcdn.com/files/30865/area14mp/ttfgt9bf-1378447095.jpg"><img width="470" src="https://c479107.ssl.cf2.rackcdn.com/files/30865/width668/ttfgt9bf-1378447095.jpg"></a>
<a style="font-size: 0.8em;" href="https://c479107.ssl.cf2.rackcdn.com/files/30865/area14mp/ttfgt9bf-1378447095.jpg"></a>Figure 1: Dependency ratios in Australia 1950-2050. Data points after 2010 are projections based on an intermediate birth rate scenario. Data compiled from https://esa.un.org/wpp/
This is the economic boom provided by the baby boom generation. The historically low total dependency ratio shown in Figure 1 meant that, for a 25 year period, more money was free to be used for discretionary spending and investment. This helped to propel economic growth and drove up incomes – and the effect was even more pronounced because it happened to coincide with major economic reforms. It also helped set high expectations on what the average Australian could afford to buy and the lifestyle they could afford to lead.
Instead of seeing the coincidence of the height of the mining boom and the baby boom as an opportunity to save for the retirement of the baby boomers and to foster industries to shoulder the burden after the inevitable decline of the mining sector, the Howard government put in place permanent income tax cuts. These were extended under the Rudd government. Now that these temporary booms are both coming to an end, those tax cuts are really starting to bite and it is becoming increasingly difficult to adequately fund the services we’ve come to expect from a modern western economy.
We are not yet entering an unprecedented level of dependency. It will take until about 2035 before we return to the dependency levels seen in the 1960s. However, there is clearly a major shift from young dependents to old-age dependents. If the costs were the same and borne by the same people, there would be no problem. But many changes have occurred. The savings from the reduction in family size have been applied to discretionary consumption, including much higher expenditure per child, so the total cost of raising children has actually increased. Little is left for transfer to expenditure on aged dependents.
How will we face this challenge? Will we keep the age pension down near the poverty line and continue to cut other government services in order to pay the rising total pension and healthcare costs as more and more baby boomers retire? Or will we take account of the shift in dependence we see in Figure 1, acknowledge the role that the baby boomers have played in the country’s economic prosperity over the last 50 years and provide them with a retirement income that allows them to live in dignity and with access to a few of the luxuries available to a modern developed country?
Australia is a low tax country by OECD standards. We can well afford to provide the baby boomers with a decent standard of living during their old age. But just how would we find the revenue? The possibility exists to use the end of the mining investment boom to finance the retirement of the baby boomers.
The distinction between mining investment and mining production is important here. It’s not the boom in mining itself which is slowing down; it’s the mining investment boom. Many more people are employed during the establishment of new mines than are employed running the mines once they are in production phase.
With the mining investment boom coming to an end, a mining production boom will follow. Most of the proceeds of the mining production phase will be exported as profits by largely foreign-owned mining companies or pocketed by the likes of Gina Rinehart and Andrew Forrest.
The Australian public owns the resources in the ground that the miners dig up and sell. When we talk about mining income, what we’re mostly referring to is asset sales, not real income. You don’t sell your car and call that money income. The mining companies add value to the resources by digging them up and putting them on a ship in an accessible form but they do not create the value of the resources themselves. Yet it is primarily the mining companies that benefit from high resource prices, rather than those who own the resources (Australian citizens). This is the very definition of economic rent; it is profit that the companies do nothing to earn which is in excess of industry expectations.
Australian citizens deserve a reasonable return for selling their assets to the mining companies and a well-designed resource rent tax would deliver that return. This revenue could be placed in a sovereign wealth fund, <a target="_blank" href="https://www.abc.net.au/lateline/content/2013/s3736272.htm">similar to Norway’s</a>, the proceeds of which could assist with paying pensions or be used to maintain and improve public services such as education and health. The one-off sale of assets should be invested in the future in some way, rather than just be used to plug holes in the budget of the present day.
Of course, resource taxation is just one of the many possibilities for increasing tax revenue. The <a target="_blank" href="https://taxreview.treasury.gov.au/Content/Content.aspx?doc=html/home.htm">Henry Tax Review</a>, completed in 2009, is full of very sound recommendations, 95% of which have been completely ignored by both Labor and the Coalition. <a target="_blank" href="https://theconversation.com/bca-wants-your-home-taxed-and-its-actually-a-good-idea-16630">Land taxes</a> are another good option, as is a <a target="_blank" href="https://ec.europa.eu/taxation_customs/taxation/other_taxes/financial_sector/">financial transaction tax</a>. Even increasing the GST is a viable option assuming adequate compensation for low income earners is included as part of the package.
Tax reform is difficult. It takes leadership because there are always losers and losers shout louder than winners – who tend to slink away with their proceeds and quietly hope nobody notices. Is there a major party political leader on the horizon with the sort of courage, honesty and charisma necessary to convince us of the need for tax increases and to resist the inevitable, well-funded backlash? Not that I’ve seen. But for the sake of those baby boomers facing decades of retirement spent in poverty, I hope that one emerges soon.
Warwick Smith is a postdoctoral research fellow in environmental economics at the University of Melbourne.
This article was originally published at <a target="_blank" href="https://theconversation.com">The Conversation</a>.
 
<img src="https://counter.theconversation.edu.au/content/17953/count.gif" alt="The Conversation" height="1" width="1">
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Ageing population and mining: A tale of two booms

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Investors are being offered a rare opportunity to acquire a 50% share in the new Queensland headquarters for GE Australia in Springfield Central.
The soon to be completed GE Queensland headquarters, located in the central business district of Australia’s largest master planned city, Greater Springfield in the heart of South East Queensland, is being offered for sale with three adjoining future development sites.
The 31 Barry Alexander Drive site - known as Parkside - has a total land parcel of 16,880 square metres.
Knight Frank’s Grant Whittaker and Ed Sutton, in conjunction with Savills Peter Chapple and Anthony Ott, <a target="_blank" href="https://www.spacehero.com.au/listing/Brisbane-Cbd-6322">are marketing the GE building and development projects</a> on behalf of master developer, Springfield Land Corporation.
“Comprising 12,500 square metres of A-grade office accommodation over five levels, the Parkside project will be a landmark asset designed by leading architects Conrad Gargett Riddel and anchored by one of the world’s largest corporations,” said Mr Sutton.
On completion, Parkside will comprise an ultra-modern office tower with ground floor retail and secure basement parking for 229 vehicles. The building is targeting a 4.5 star NABERS rating.

Mr Sutton said the residual land contained in the project’s commercial precinct provided an opportunity to partner with the master developer, Springfield Land Corporation, to undertake a joint venture for the development and delivery of the three separate but adjoining lots. The lots are known as Parkside Two, comprising 1,790 square metres, Parkside Three 4,745 square metres and Parkside Four 5,345 square metres for uses including commercial, hotel and retail, he said.
<a href="mailto:news@propertyobserver.com.au" target="_blank">news@propertyobserver.com.au</a> 
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Investors offered chance to purchase 50% stake in new Queensland headquarters for GE Australia

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Serviced office provider Servcorp said it was on track to deliver continued earnings growth in the 2014 financial year after handing down a 20% lift in interim net profit.  
Net profit after tax came in at $11.12 million for the six months to 31 December, on revenue growth of 15%.  
Like for like occupancy across the group was steady at 78%.
Excluding North Asia and the ANZ/SEA region - which comprises of Perth, Singapore, Kuala Lumpur and Wellington - the remaining international locations achieved their occupancy target of between 82-85%. 
Growth in the virtual office business continued in line with management's expectations, delivering growth of 9% to about 37,000 packages.
The company's operating cash flow was strong - up 63% to $18.13 million. 
On the outlook, management said that "initial indications are that business conditions are starting to recover around the world".
"Over the last four years we have substantially enhanced our footprint and as the global economy improves we are very well positioned to take advantage of the recovery in global business sentiment.”  
Its current vacancy levels, added management, gave the company “significant opportunity to improve our margins and operating results". 
It is aiming to grow its footprint in strategic locations and to add 10% to office capacity in FY14.
<a target="_blank" href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a>
  
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Servcorp hands down 20% lift in interim net profit over first half of financial year

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Improved trading conditions in Melbourne, Sydney and a recovery in Cairns helped boost average hotel room rates across the country by more than 3% in the 12 months to December 2013.

The figures were revealed in the latest Savills Insight Australian Hotels report, which painted an upbeat picture for hotel industry in the year ahead. 
"As the correction of the Australian dollar continues, domestic travel is likely to increase and Australia will become more affordable for international tourists", the report said. That combination of factors, it believes will lead to increased demand and higher rates in Australian hotels.
Average revenue per available room (RevPAR) growth rose by 3.2% to $132.36 in 2013. RevPAR is a key industry performance measure based on multiplying the occupancy rate by average daily room rate.
RevPAR growth was the strongest in Melbourne, which recorded a 7.2 per lift, followed by Sydney at 6.4% and Cairns at 3.3%. That was offset by falls in Perth, which was affected by the mining industry scale back, Brisbane and Canberra.  
Savills is tipping a better year ahead for the Brisbane market, with expectations of a "spike in trading" during the G20 summit in November.  
During the 12 months to December, Savills recorded 69 sales of hotel assets over $5 million throughout Australia, representing a total value of $2 billion. More than half of that total value was attributed to the sale of the Four Seasons Hotel Sydney and the TAHL portfolio. 
With demand continuing to outstrip supply, the report said: "current owners are looking to capitalise on rising values and view the next 12 to 18 months as a good time to exit the market."
Savills also highlighted that development of new hotels was picking up and as a result "we could see offshore investors acquire hotels on forward commitments as a way to secure assets in a tightly held market."
<a target="_blank" href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a>
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Average national hotel room rate lifts by over 3% in 2013: Savills

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Investor demand continued to grow in the latter stages of 2013 with the value of loans for investors jumping by 8.2% in October. That equates to $10.3 billion, the highest level on record. This increase is resulting in strength in the property market and will entice more investors back to the market. Investors traditionally want to ensure they get the timing right and do not want to be left behind. This means most investors will make their move once they are sure other investors are active.  
As investors continue their comeback to the market in 2014, it is important not to get too carried away and enter with a level head. Whether you’re a first-timer or seasoned campaigner, successful property investment is based on certain timeless principles.  
Here are six of the best:  
<ol start="1">
<li>
Horses for courses. Despite much of what you read and hear, no two properties work the same way. Commercial property is primarily income-producing, whilst residential property primarily generates capital growth. Some properties need substantial renovation to improve their resale value, whilst others have inherently high land values that do the job for you. Some properties (like B&amp;Bs) demand a lot of time and hands-on involvement, whilst others can be managed by a third party, enabling you to ‘set and forget’.
All these differences mean that the property which is right for you may not be the property which is right for someone else. Before you enter the market, it’s essential to consider your personal and financial circumstances and goals, your stage of life and the level of involvement you’re prepared to have.
</li>
</ol>
<ol start="2">
<li>
Strategise first, buy later. Decide what type of property is appropriate for your situation. Do you have a large enough working income to support the costs of owning an investment property? If so, a residential property that can provide capital growth may be the best bet. Do you need income to replace your wage or salary? In this case, a commercial property or commercial property trust may be more suitable.
Next, determine which entity is going to own it. There are several forms of ownership: individual, partnership, company, trust or self-managed superannuation fund. The tax office treats each form of ownership differently, so seek advice from your solicitor or accountant before you buy. If you have to change the form of ownership down the track, you could be up for thousands in additional stamp duty and/or capital gains tax.
</li>
</ol>
 
<ol start="3">
<li>
Get your finances in order. No matter which type of property you buy, the substantial entry and exit costs mean you must consider it a long-term proposition. It’s not just a case of having the funds to buy the property, but being able to fund the holding costs for at least seven to 10 years. Think ahead to possible changes in your circumstances (such as starting a family, becoming self-employed or retiring) that could affect you ability to hold the asset for the long term.
If you’re buying a new or near-new property and relying on claiming depreciation benefits to maximise your cashflow, remember that most depreciation occurs in the first five years. Once you’ve used up your depreciation allowance, you could be out of pocket unless you can find another source of income to fund the holding costs.
</li>
</ol>
<ol start="4">
<li>
BYO research. When you’re researching the local market, be wary of free advice. If someone is purporting to ‘advise’ you but being paid by the vendor, they’ll be accountable to the vendor, not to you.
Instead, do your own research by looking at reputable statistics from objective agencies, attending auctions in person and tracking auction results. If you need back-up, seek advice from professionals who don’t have a vested financial interest in steering you towards a certain course of action.
</li>
</ol>
<ol start="5">
<li>
Know your limit. You’re buying an investment property, not a home to live in. You don’t have to love it – or even like it. Leave your emotions at the front gate, set a limit based on your research and stick to it. If the bidding goes over your limit, drop out of the race. It’s one thing to buy well, but buying at all costs simply isn’t smart investing.
</li>
</ol>
<ol start="6">
<li>
Regular reviews. Cast a critical eye over your financing arrangements and property portfolio once a year to decide whether they’re still doing the required job. The finance market changes constantly, so you may be able to get a better deal with a different product, package or lender. Are your properties generating rental income and/or capital growth higher than the wider market? If they’re lagging behind Melbourne-wide or local median rental and property values, it may be time to consider selling.
</li>
</ol>
Mark Armstrong is a director of <a href="https://www.ipropertyplan.com.au/">iProperty Plan</a>, which provides independent analysis and tailored advice to investors and home buyers.
 
 
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Six things you need to know about investing in property

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There was once a time when the start of a house-hunt was signalled by the quiet chime of the bell over a real estate agent’s door. Things have changed.
Searches that once took weeks can now be done on the train to work. Processes that didn’t seem possible are now every day events.
Progress marches on and almost every aspect of the property market now has an online presence. There is now a website, app or tool for every imaginable facet of real estate.
These make dealing with property easier, faster, more efficient and can help save money. There is so much more to working online than posting ads on big property portals.
There are a multitude of websites, apps and tools to help people buy, sell, market, discover and manage properties – so many that it’s easy to get overwhelmed by the deluge.
The vast legion of online tools available allow one to snoop on property prices, go on holiday, make money, spend money, get price estimates, make plans, break plans, play, hunt and stay up to date.
So many aspects of property have been covered online that Property Observer made this A-Z of online property sites and apps. Here is part one of Property Observer’s favourite online websites and apps, to help you with all aspects of property.
Alerts 
There’s no excuse for missing that perfect property now. Websites will alert you every time a property that fits your criteria pops up. With alerts, you can be the first to know about a new listing before it gets snatched up. The various real estate portals all offer their different flavours of alerts.
<a href="https://domain.com.au" target="_blank">Domain.com.au</a> allows some very specific alerts to be sent. If you have a problem with cemeteries, you can specify homes at least 5km away from them, but within 1km of a park. You can choose to be close to the train station, but away from gaols and power stations. You can search for a home within those constraints, but also make sure you’re only sent three-bedroom properties that have a balcony and a shed within the inner city region. A daily or weekly alert with all these properties is easily set up through their search function. 
<a href="https://realestate.com.au" target="_blank">Realestate.com.au</a> has a similar offering, but it’s not quite as powerful. While Realestate.com.au does have more properties listed, we found the filters on Domain to be more refined. We welcome the environmentally friendly search options such as solar panel and energy efficiency filters, but these are not enough to set it apart from Domain. The email alerts are quite useful however, and you can set up multiple searches to the same address.
<a href="https://www.propertyobserver.com.au/Realestateview.com.au" target="_blank">Realestateview.com.au</a> can also send property alerts. The search feature can’t discriminate properties quite as well as Domain or RealEstate.com.au but the filters are tolerable. However, to save a search listing you must create an account or sign in with Facebook.
Alongside these portal websites, most individual real estate agency websites have the ability to send alerts on specific searches. If there are just two or three agencies active in your area it might be better to subscribe to their individual alerts.
Article continues on next page. Please click below.
 
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Augmented Reality
It can often be quite hard to visualise the vast reams of data available online. You can easily access 20 pages of hard data on a suburb and come away without a clear idea of what things are worth in an area. This is where augmented reality comes into play.
Augmented reality is a relatively recent development where real world information is overlayed over a camera’s output. It pulls information from the web based on your location and superimposes it over whatever you point the camera at.
<a href="https://itunes.apple.com/au/app/commbank-property-guide/id375054462?mt=8" target="_blank">CommBank Property Guide</a> uses this free technology to overlay past sales history, current property listings and recent sales over a real world view through the iPhone’s camera. They say it works on more than 95 per cent of residential properties in Australia but Property Observer has found some of their data lacking. It takes its information from RP Data and realestate.com.au.
If you don’t have any luck with Commbank’s app try the free <a href="https://itunes.apple.com/au/app/anz-property-tracker/id393053333?mt=8" target="_blank">ANZ Property Tracker</a>. It has a similar feature-set but pulls its data from Fairfax’s domain.com.au and Australian Property Monitors. Again, it’s a great idea, but we found it to be a little less than perfect.
Article continues on next page. Please click below.
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Banks
If you’re buying property, you’re going to have to deal with a bank at some point. It’s just how these things work. The banks all have their various online offerings and some have some quite nifty apps.
<a href="https://www.anz.com" target="_blank">ANZ</a> have been lauded for their latest mobile banking effort. The ANZ goMoney app is a simple to use but quite powerful app. It has a great new development where you can pay someone just with their phone number, which ANZ markets as an easy way to split bills. If you’re torn between ANZ and another offering, this app might be a deciding factor. Their website isn’t quite as slick but it’s a solid offering.
The <a href="https://commbank.com.au/" target="_blank">Commonwealth Bank</a> website has all the usual features, with quite an intuitive front page. Their website has the usual features. The page isn’t too cluttered but still has quick access to quite a few useful tools.
They’ve just launched a new mobile banking app that’s got a few people excited. Its claim to fame? It makes paying people incredibly easy. The app even lets you pay for drinks at a bar simply by waving your phone over a Mastercard PayPass terminal, which are gradually being rolled out across Australian businesses. Take note, this option does require buying an iCarte iPhone case. This latest app is a huge improvement over their earlier efforts.
<a href="https://www.stgeorge.com.au/" target="_blank">St Georges Bank</a>’s mobile banking app has a good reputation. It was frequently regarded as the best mobile banking offering until ANZ released goMoney and Commonwealth released their new app. The website is strictly utilitarian and doesn’t have too many flashy banners to divert your attention.
<a href="https://www.westpac.com.au/" target="_blank">Westpac</a>’s website does have quite a lot of information online. If you feel like a bit of light reading, they do regularly release economic updates, including information on the property market. Their mobile banking app is a well made piece of software and is regularly updated.
<a href="https://www.nab.com.au/" target="_blank">NAB</a>'s website has quite easily accessible information on their home loan offerings. In fact most of their website is quite intuitive. Their app is a standard issue banking app that does that job reasonably well.
Article continues on next page. Please click below.
 
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Calculators
Real estate is all about money, and money needs maths – sometimes, quite complicated maths. Thankfully, there are some kind souls out there that make these things easier, with a range of intuitive calculators for smart phones.
<a href="https://itunes.apple.com/au/app/tapmortgage-australia-mortgage/id402187202?mt=8" target="_blank">tapMortgage</a> is an Australian made app to calculate stamp duty, transfer fees, first home concessions and more. It hasn’t been updated since August 2011, but it's a great tool to calculate mortgage costs.
<a href="https://itunes.apple.com/au/app/real-estate-master-iiix/id398247923?mt=8" target="_blank">Real Estate Master IIIx</a> is a calculator for estate agents. It allows you to calculate mortgage insurance, amortization, FHA, ARMs, rent/buy comparisons and more. It can do just about any calculation a real estate agent might need to do. There are videos on Youtube to help with the more complicated sums one can do with the app.
<a href="https://itunes.apple.com/us/app/property-evaluator-real-estate/id335518202?mt=8" target="_blank">Property Evaluator</a> is an iPad app that gives comprehensive estimates on property costs and returns for investors. It allows you to input every imaginable piece of financial data about a property and then crunch the numbers to give estimated returns over the next 30 years. It’s a useful tool and might be instrumental in demonstrating the real value of a property.  This comprehensive app allows you to graph and table all the generated information and email this on. It’s not designed purely for the Australian audience so there may be a couple of hiccups along the way, but for basic projections the app works well.
Article continues on next page. Please click below.
 
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Depreciation
Depreciation is an easy way to claim some money come tax time but it’s often regarded as a bit of a mystery area with property – but no longer.
<a href="https://itunes.apple.com/au/app/wb-dep-calc/id448589647?mt=8" target="_blank">Washington Brown Tax Depreciation Calculator</a> calculates the tax depreciation of a property. Under Australian tax rules, investors can claim the depreciation of their investment properties against their taxable income. If it’s something you find yourself doing quite often, this app might come in handy.
<a href="https://www.aiqs.com.au" target="_blank">The Australian Institute of Quantity Surveyors</a> is the national professional standards organisation for quantity surveyors. It’s a good resource for finding a local professional to help you with all your quantity surveying needs including depreciation.
Article continues on next page. Please click below.
 
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Environmental Concerns
Houses are designed to take the occupiers out of the elements and put them into a safe place, but you can’t just ignore the environment. Real estate affects the environment, and conversely, the environment affects real estate. There are tools out there to help make homes more sustainable and liveable. A big part of living in Australia, especially in rural areas, is the threat of natural disasters. So we’ve included a series of tools that inform users about risks associated with the Australian environment.
<a href="https://www.ecoeasy.com/index" target="_blank">Eco Easy Home </a>is a new Australian app that grades the environmental credentials of a property. It allows users to rate their home on a number of factors through its clean interface. The app allows users to work out the orientation of a home and the future sun paths around a property. The app is full of drawings, diagrams and helpful information to assess a home. The rating system is based on a system used by architect Gareth Cole and NSW councils. The app is useful for vendors hoping to spruik the environmental credentials of a home and buyers looking to discriminate between various choices. Overall, its a very comprehensive app aimed at Australian usage. There is an iPad edition coming somewhere down the line.
<a href="https://www.liveability.com.au/" target="_blank">Liveability.com.au</a> is an online resource for owners, renters and landlords on living sustainably. The site publishes advice on how to make property more environmentally friendly.
Our country is prone to disasters. Sometimes nature decides to shake things up a bit. When investing in a new area, especially in more remote or rural areas, it’s important to know what to expect.
<a href="https://itunes.apple.com/au/app/disasterwatch/id484402725?mt=8" target="_blank">Disasterwatch</a> is the ultimate app for the perpetually nervous. Created by the Australian Emergency Management Institute, this app gives real time updates and warnings on all possible disasters in Australia. You can check fire safety warnings before deciding on buying that nice house in the bush.
<a href="https://home.iprimus.com.au/foo7/menu" target="_blank">Romsey Australia</a> is well worth a read. It catalogues the history, threats and nature of areas all around Australia. It’s the work of an independent organisation who disseminate freely available information in an easily digestible form. It’s not the most beautiful site but it’s a favourite of ours.
Queensland really copped a beating in 2011. People died and many homes suffered severe flood damage especially around Brisbane. It was a tragic time but what happens now? How do you know if a home for sale suffered flood damage. It might look fine but there could be rot lurking beneath. Or if it was rebuilt, how can do you know if it’s in a flood prone area. These tools will help.
<a href="https://flood.brisbane.qld.gov.au/floodwise_property_report/" target="_blank">FloodWise Property Report</a>: If you’re buying in Brisbane this government run website has flood history of all Brisbane areas. Sometimes agents don’t volunteer flood information so it’s best to check this website first. Given the recent floods this really is a sensible idea when buying in Brisbane.
<a href="https://pdonline.goldcoast.qld.gov.au/masterview/modules/propertymaster/default.aspx?page=home" target="_blank">Planning and Development Online</a>: This is a similar tool for the Cold Coast. You can search by property address and check for flood reports. Without this tool it might not be immediately apparent that a property is prone to flooding.
Article continues on next page. Please click below.
       
 
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Floor Plans
We have no time for people who post online real estate listings without floor-plans. Impress people and make friends by producing your own floor plans with one of these great tools. Your clients will love you.
<a href="https://itunes.apple.com/au/app/magicplan/id427424432?mt=8" target="_blank">MagicPlan</a> allows you to automatically create a floor plan of a house within minutes just by taking photos. Walk around a property with your phone and take photos of every corner in the house and it will automatically create a floor plan. One of the few genuinely ground-breaking apps, and free, this is great news for agents or buyers when there are no floor plans available.
<a href="https://floorplanner.com/" target="_blank">FloorPlanner</a> is a powerful online tool for creating easy floor plans and furniture placement. You can add floorplans from possible purchases and see how your furniture fits in. Brilliant. As of May 7, they have added an iPad app.
<a href="mailto:news@propertyobserver.com.au" target="_blank">news@propertyobserver.com.au</a>
 
 
 
 
 
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The A to Z of property apps: Part one

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<img src="/images/stories/2013/10/29/KF_STACKED_RGB.jpg" width="200" height="75" alt="KF_STACKED_RGB" style="max-width: 480px; display: block; margin-left: auto; margin-right: auto;">
Name: Ashley Moffat<img style="float: right;" alt="ashley_moffat_feb_17" height="125" width="100" src="/images/stories/2014/02/17/ashley_moffat_feb_17.jpg">

Position: Associate director, retail leasing

Company: Knight Frank

Office Location: Brisbane





How long have you been in the industry?
21 years
What’s happening in the area you specialise in?
Plenty – the sands are shifting constantly in retail leasing and sometimes hard to keep up with the latest trend/fad/concept. At the moment, it’s all about very specific fresh food concepts. Rather than just opening an Italian restaurant, restaurateurs are instead opening up a “Meatball” restaurant which may roll out 10 different varieties of meatballs. It’s all very exciting.
Describe the most interesting property you have sold
I’ve spent most of my career leasing or developing shopping centres. Probably the funniest transaction was when I was in the pub talking to a complete stranger who, after sharing a couple of drinks, asked me whether I was interested in buying a piece of land he had an interest in. 12 months later I completed building a BI-LO Supermarket and specialty shops on it which resulted in a few million dollar profit for the company I was working for at the time. Goes to show, networking does work!
What are the ingredients to being successful in your job?
You have to love it, because it shows if you don’t. There are plenty of people that just go through the motions; they are also the first people to complain they haven’t received a promotion or aren’t making any money.
What aspects of your role do you enjoy the most?
Every day is different, every hour is different – it never gets boring.
Where would you invest a spare $750,000?
I’m a big believer in the Gold Coast at the moment – it’s clawing its way out of the mud and there are just some unbelievable opportunities to pick up. I would choose a two bedroom, two bathroom unit overlooking the ocean, in an older style building, for mid to high $400,000s. Spend $50,000 modernising it and to me, that is a smart investment for the boom that is on the horizon.
Which football team do you support?
Broncos (don’t hit me!), Roar and the Lions. And of course the Reds. Any ueensland team with the exception of the Titans – my brother and sister support the Titans so I automatically hate them just to be annoying! Makes for interesting dinner table conversation when we catch up.
What’s your favourite app or techno gadget?
“Kaching”, which is the Commonwealth Bank app. Obviously only handy if you bank Commonwealth, but I use it all the time, it’s just eliminated so much time wasted getting online or going to the bank.
<ol></ol>
How do you use social media?
I admit to being a little “slow” to embrace these mediums. I don’t have Facebook because I like to maintain some form of private life. However, I am starting to embrace <a target="_blank" href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/ashley-moffat/79/971/975">LinkedIn</a>, which I think is a very handy tool for professionals to communicate and share information. But I’m still a little “old school”, and believe nothing beats picking up the phone and talking to somebody, or better still, face to face contact.
<a target="_blank" href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a>
Correction: Ashley Moffat's title has been updated to associate director of retail leasing since initial publication.
         
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In profile: Knight Frank's associate director of retail leasing, Brisbane, Ashley Moffat

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Total industrial vacancy on Australia's eastern seaboard surged to a near three year high in the 12 months to January, as the Melbourne and Brisbane markets were swamped with additional space.
Fresh figures from Knight Frank's Quarterly Eastern Seaboard Industrial Vacancy report showed that the total industrial vacancy on the east coast rose 2% over past quarter and 10% in the past six months to 1.84 million square metres as at January 2014, reflecting a 28% increase over the same time last year.
<img alt="chart_of_the_week_feb_18_one" height="316" width="470" src="/images/stories/2014/02/18/chart_of_the_week_feb_18_one.png">
Source Knight Frank
Inflating that result was a jump in available industrial space in Melbourne, which was up 26% to 626,848 square metres over the past six months - the highest vacancy in more than three years.
The vacancy rate in Brisbane soared 17% to 551,433 square metres - the highest recorded by the survey, which started in early 2007.
Taking a 12 month perspective, the vacancy rate was more pronounce in Melbourne and Brisbane - up 75% and 67%, respectively.
Sydney was the bright spot in the results, with the vacancy rate falling 7% to 662,661 square metres, down 7% over a six month period and 12% over the year.
Prime space across the Australian east coast market remained relatively scarcer than secondary, however the proportion of prime space had increased marginally over the past year, from 34% to 44% of the market, said Knight Frank's head of research and consulting Matt Whitby.
The highest proportion of available prime space is within the Sydney market with 49%, equal to 322,350 square metres of total available stock.
"The proportion of total vacancies made up of prime stock is now at its highest level since the series began although the majority of these options are in the sub 10,000 square metres range," Whitby said.
Better placed was the secondary market, which has fallen 40% since its peak down to 340,300 square metres.
“This is expected to correct sharply over the coming quarter with a strong pipeline of 35,000 square metres of vacant stock in Sydney currently under offer, 20,000 square metres of which is speculative builds,” said Whitby.
"This is another sign that confidence is returning, particularly within the Sydney market, as much of 2013 was dominated by shorter term leases in secondary accommodation as a hold over measure until corporate confidence improved and longer term, higher grade accommodation is sought.”
Commenting on the tenant demand, Knight Frank national industrial director, Greg Russell, said that the take-up across the eastern seaboard had softened for the second quarter in a row, following the July 2013 quarter record result, with 34 buildings over 228,493 square metres absorbed.
“There is some scope for leasing demand to pick up, as enquiry levels suggest a degree of improvement, however there remains a lack of urgency from tenants to finalise premises related decisions,” Russell added.
The Knight Frank research also pointed to the firmer tenant demand for prime grade stock, with 78% of gross absorption in the second half of 2013 dominated by prime accommodation. The take-up of secondary accommodation over the past quarter - some 49,400 square metres - is significantly less than the 273,800 square metres absorbed in the July 2013 quarter.
<a target="_blank" href="mailto:news@propertyobserver.com.au">news@propertyobserver.com.au</a>  
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East coast industrial vacancy surges to near three year high: Knight Frank

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SCA Property Group (ASX code: SCP) announced on February 14, 2014, its intention to undertake an on-market buy-back of up to 5% of its shares at a price of up to its current net tangible asset value (NTA) which is currently $1.59 per share. The buy-back will be funded from cash and drawing down on debt facilities. The current share price is $1.555 which is up 3.5 cents from the price prior to the announcement.
Companies buy-back issued capital as part of a capital management strategy. This is appealing when the stock is trading at a discount to NTA as it is investing at a discount.
A buy-back of shares can increase earnings per share, NTA per share and return on equity. A buy-back will reduce the equity on issue and increase the gearing level. This can be positive when borrowing costs are low. SCA Property Group’s earnings yield is 7.05% per annum and its borrowing rate is 4.8% thereby creating a positive outcome from gearing for the company.
Table one (below) shows how SCA Property Group’s earnings per share (EPS), NTA per share and return on equity (ROE) following a buy-back of shares. It is assumed that the full 5% of shares are bought back at the close price on 17 February 2014.
Table one – SCA Property Group buy-back
<table style="width: 470px;" border="0" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="bottom" nowrap width="143">
 
</td>
<td valign="bottom" nowrap width="132">
Pre buy-back
</td>
<td valign="bottom" nowrap width="142">
Post buy-back
</td>
</tr>
<tr>
<td width="143">
Share price
</td>
<td valign="bottom" nowrap width="132">
$ 1.520*
</td>
<td valign="bottom" nowrap width="142">
$ 1.555**
</td>
</tr>
<tr>
<td width="143">
Total net assets
</td>
<td valign="bottom" nowrap width="132">
$ 1,031m
</td>
<td valign="bottom" nowrap width="142">
$ 981m
</td>
</tr>
<tr>
<td width="143">
Shares on issue
</td>
<td valign="bottom" nowrap width="132">
648m
</td>
<td valign="bottom" nowrap width="142">
616m
</td>
</tr>
<tr>
<td width="143">
Reported earnings
</td>
<td valign="bottom" nowrap width="132">
$ 43m
</td>
<td valign="bottom" nowrap width="142">
$ 43m
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="143"> </td>
<td valign="bottom" nowrap width="132"> </td>
<td valign="bottom" nowrap width="142"> </td>
</tr>
<tr>
<td valign="bottom" nowrap width="143">
ROE
</td>
<td valign="bottom" nowrap width="132">
4.2%
</td>
<td valign="bottom" nowrap width="142">
4.4%
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="143">
NTA (per share)
</td>
<td valign="bottom" nowrap width="132">
$1.590
</td>
<td valign="bottom" nowrap width="142">
$1.592
</td>
</tr>
<tr>
<td valign="bottom" nowrap width="143">
EPS
</td>
<td valign="bottom" nowrap width="132">
6.7%
</td>
<td valign="bottom" nowrap width="142">
7.1%
</td>
</tr>
</tbody></table>
Source: IRESS, Atchison Consultants
* Close price on February 13, 2014
** Close price on February 17, 2014
As shown in table one the return on equity would increase from 4.2% to 4.4%, NTA per share would increase from $1.59 to $1.592 and earnings per share would increase from 6.7% to 7.1% following the buy-back.
Paul Easton is a senior analyst at <a href="https://atchison.com.au/" target="_blank">Atchison Consultants</a>.
 
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peaston-2dTB6MdgmG

SCA Property Group buy-back: How will it work out? 

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I appreciate Arek Drozda’s very thoughtful piece in yesterday’s Property Observer (“<a href="https://www.propertyobserver.com.au/trends/revisting-steve-keens-40-property-price-fall-prediction/2014021667812/Page-1" target="_blank">Revisiting Steve Keen’s 40% property price fall prediction</a>”), and this note is intended to clarify some hazy issues.
My 40% claim indeed has become part of the folklore, and as with folklore, the tale is very different to the original event. Arek is quite correct that it was not a prediction, but an analogy to overseas trends, in response to an unscripted question (from memory in a 7.30 Report interview) about what my economic predictions meant for Australian house prices. It was also based on Japan, not the USA, since at the time the USA bubble hadn’t burst. I commented that house prices in Japan had fallen about 40% in the 10-15 years since their bubble economy burst, and I “saw no reason why Australia would avoid the same fate”.
Arek comments that at the time he treated this call “with a fair dose of scepticism since I could not find corroborating evidence for such a substantial fall in prices using indicators from my own analytical toolkit”.
In fact, it appears that I understated Japan’s experience (and by sheer chance picked the level that USA prices would fall by). The <a href="https://www.bis.org" target="_blank">Bank of International Settlements</a> — the only formal body to warn of the crisis before it happened— recently released <a href="https://www.bis.org/statistics/pp.htm" target="_blank">a data series on house prices across the world</a>. Using that data for Japan, Shiller’s data for the USA, and the ABS’s data for Australia gives the picture shown below in Figure 1. Japanese house prices actually fell almost 60% in the 15 years after their peak in 1988, while US prices fell 40% in six years (before the rebound began in 2012).
Figure 1: House prices after financial bubbles burst
 <img src="/images/stories/2014/02/18/keen-feb-18-one.gif" width="470" height="411" alt="keen-feb-18-one">
However at the time of my answer to a “question without notice”, I hadn’t done any serious analysis of house prices; my focus was on the level and rate of growth of private debt and its implications for the macroeconomy—and on that analysis, in contrast to the vast majority of economists, I believed that a serious crisis was imminent (and that would affect asset prices as well as the real economy).
Mainstream economists ignored private debt on the argument that “one person’s debt is another person’s asset” (Paul Krugman 2012, End this Depression NOW!, p. 43), so neither banks nor debt (nor money!) existed in mainstream models. In contrast, private debt played an integral role in <a href="https://www.debtdeflation.com/blogs/wp-content/uploads/papers/Keen1995FinanceEconomicBreakdown_JPKE_OCRed.pdf" target="_blank">my non-orthodox “Minsky model” of the economy</a>. In December 2005, when I saw the trends in private debt in Australia and the USA (see Figure 2 below), I went public with the warning that a serious debt-induced economic crisis was inevitable in the near future:
At some point, the debt to GDP ratio must stabilise–and on past trends, it won’t stop simply at stabilising. When that inevitable reversal of the unsustainable occurs, we will have a recession (see “<a href="https://www.debtdeflation.com/blogs/2007/04/30/debtwatch-may-2005-booming-on-borrowed-money/">Debtwatch May 2007: Booming on Borrowed Money</a>”).
Figure 2: Private debt trends and my warnings of a crisis when they reversed
 <img src="/images/stories/2014/02/18/keen-feb-18-two.gif" width="470" height="402" alt="keen-feb-18-two">
The crisis that I expected duly arrived in 2008, when the rate of growth of private debt began to fall (see Figure 3 below). As Arek points out, my measure of aggregate demand includes the contribution from the change in debt (<a href="https://www.debtdeflation.com/blogs/2014/02/02/modeling-financial-instability/">an argument I’ve since proven here</a>), so my analysis implied that simply a slowdown in the rate of growth of debt can cause a crisis.
Bear in mind that at the same time, mainstream economic advisors like the OECD were telling governments that “<a href="https://www.oecd-ilibrary.org/economics/oecd-economic-outlook-volume-2007-issue-1/achieving-further-rebalancing_eco_outlook-v2007-1-2-en;jsessionid=l84e3jqj65oa.delta" target="_blank">the current economic situation is in many ways better than what we have experienced in years</a>”.
Figure 3: The rate of change of debt and the onset of the crisis
 <img src="/images/stories/2014/02/18/keen-feb-18-three.gif" width="470" height="336" alt="keen-feb-18-three">
Article continues on the next page. Please click below.
 
<hr class="system-pagebreak">
Arek also muses about whether the Credit Accelerator was behind my house price call in 2008. It wasn’t, because I hadn’t developed it then—and I didn’t do so until after Biggs, Mayer and Pick developed what they called the “<a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1595980" target="_blank">Credit Impulse</a>”, using related but different logic.
The concept itself was an obvious extrapolation from my thinking on aggregate demand: if aggregate demand included the change in debt, then the change in aggregate demand included the acceleration of debt. I simply didn’t develop the idea, because I doubted that economic data would be reliable enough to reveal it, since it would involve comparing a second differential—the rate of change of the rate of change of debt—to first differentials, like the rate of change of house prices.
It turns out that I was wrong: Biggs et al showed that the effect turned up strongly in economic data. I then turned it to asset price data as well—with the approximation that I compared the rate of change of the rate of change of mortgage debt over a year to price change over the year.
As Arek notes, the correlation of the acceleration of mortgage debt with house price change is quite strong: it’s 0.68 in Figure 4, 0.88 since 2010, and 0.63 since 1993 (there was a break in the RBA data in 1991 that stuffs up calculations prior to then).
Figure 4: Stepping on the pedal--mortgage acceleration drives house price changes
<img src="/images/stories/2014/02/18/keen-feb-18-four.gif" width="470" height="320" alt="keen-feb-18-four">
As you can see, the mortgage accelerator indicator was predicting a turning point in house prices from the beginning of 2012. I didn’t make such a call then, partly because I didn’t completely trust my own indicator—which I had only started to develop one year earlier.
But another substantial reason was, in a word, revulsion. I am first and foremost an economist — and a rebel one at that — and I had hoped the world would learn from this crisis that we can’t base our collective economic welfare on borrowing money to buy second-hand houses from each other. But as Figure 5 and Figure 6 indicate (both below), we’re doing precisely that again: mortgage debt is on the rise once more (and it never fell in Australia, with the First Home Vendors Boost being a major reason that it didn’t do so), and this is driving house prices up again in the USA and Australia.
Figure 5: Mortgage debt on the rise again
<img src="/images/stories/2014/02/18/keen-feb-18-five.gif" width="470" height="335" alt="keen-feb-18-five">
I share <a href="https://www.businessspectator.com.au/article/2014/2/14/european-crisis/hair-dog-risks-bigger-british-hangover" target="_blank">Martin Wolf’s lament</a> about this. One might hope we would learn from our mistakes, but instead we seem to be in a rush to repeat them:
"The credit machine is indeed beginning to work, once again … But we have seen this play before. It ended as a tragedy…  Now, in the UK, people are celebrating the restarting of the very process that ended in this huge disaster."
As for how long the bubble can go on in Australia, we now have two additional factors that are driving prices over and above the impact of accelerating mortgage debt. These are the absence of any controls on non-residential purchases of new properties — as if housing is an export rather than, primarily, a consumption item for Australian residents — and the insane decision in 2007 to let self-managed superannuation funds take levered positions on housing and call it saving for their retirement.
Figure 6: Australian vs US mortgage debt; indebted DownUnder
<img src="/images/stories/2014/02/18/keen-feb-18-six.gif" width="470" height="402" alt="keen-feb-18-six">
The ride to the top may therefore last longer than the Credit Accelerator might imply (though SMSF mortgages should turn up in the data, much of non-resident buying won’t), and property speculators may well enjoy the ride, as Arek observes.
But to my macroeconomist’s eye, it will be a tragedy for the commons if all we will have to show for this decade is deeper mining holes, more expensive houses, a hollowed-out manufacturing sector, and an even more indebted society.
Steve Keen is the author of 'Debunking Economics', the blog <a target="_blank" href="https://www.debtdeflation.com/blogs/">Debtwatch</a> and developer of the <a target="_blank" href="https://www.debtdeflation.com/blogs/minsky/">Minsky software program</a>.
 
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