Longstanding Gold Coast and Canberra developer <a href="https://www.apartments.com.au/developers/morris-property-group">Morris Property Group</a> is continuing to roll on with its Glitter Strip apartment pipeline, seeking to return to Mermaid Beach with a new 68-apartment development.

Morris, founded by Barry Morris in 1978 and one of the Gold Coast’s most prolific apartment developers over the past two decades, has filed plans for a 12-storey mixed-use building at <a href="https://www.apartments.com.au/new-apartments/36-seabeach-avenue-mermaid-beach-qld-4218">34-36 Seabeach Avenue</a>, on the prized eastern side of the Gold Coast Highway.

The 1,227 sqm site occupies a prominent corner position at Seabeach Avenue and the Gold Coast Highway, opposite the Mermaid Plaza retail and office precinct and around 140 metres walking distance from the future Mermaid Beach South light rail station.

<a href="https://www.apartments.com.au/architects/fraser-partners-0">Fraser &amp; Partners</a> has designed the project, which will comprise 68 apartments across a mix of 48 two-bedroom and 20 three-bedroom residences.

The building will rise 12 storeys, reaching a maximum height of 36 metres, with the apartments accounting for a total of 156 bedrooms. The development application also seeks approval for short-term accommodation across the 68 apartments, while two office tenancies are proposed at ground level.

The plans show 108 car spaces across the development, with parking accommodated at ground level and within a three-level basement accessed from Seabeach Avenue.

<img alt="Seabeach Avenue and the Gold Coast Highway" data-entity-type="file" data-entity-uuid="c2175c99-12fd-4a3c-9be1-89bbf258a90d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-20%20at%202.59.41%E2%80%AFPM_0.png?VersionId=iNLzWcE6gaAE76rafhEXfHve.4g4Se0p" />

Resident amenity will be concentrated on level two, where Fraser &amp; Partners has designed a recreation deck with a swimming pool, 90 sqm pool terrace, outdoor barbecue area and gym.

The broader communal offering will also incorporate landscaped spaces, with the planning documents noting the amenity has been designed to provide areas for recreation, social interaction and outdoor living.

The proposal would continue the transformation of the Gold Coast Highway corridor through Mermaid Beach ahead of the arrival of the light rail.

The site is zoned Neighbourhood Centre and sits within the Mermaid Beach/Broadbeach Light Rail Corridor neighbourhood plan. While the prescribed building height is 24 metres, the site is identified within an Urban Neighbourhood context providing for a 50 per cent height uplift to 36 metres.

Planning documents describe the stretch of the Gold Coast Highway between Broadbeach and Nobby Beach as increasingly characterised by medium and high-rise development, with the proposed Morris tower joining projects including Ventura, The Alfred, Oceans and Otto.

<img alt="Seabeach Avenue and the Gold Coast Highway" data-entity-type="file" data-entity-uuid="911f193f-e381-4a55-be08-58be87fcf978" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-20%20at%202.59.48%E2%80%AFPM.png?VersionId=oxVvLJaY.SOXEdXrIcogfyEXDfvCmmpM" />

The development would mark Morris Property Group's latest investment in Mermaid Beach, where it has already delivered two apartment projects.

Otto, at 1 Bondi Avenue on the western side of the Gold Coast Highway, comprises 70 apartments across nine storeys. The project was completed in 2019 and includes a residents' gym, recreation deck and swimming pool.

Morris also developed Oceans at 46 Ocean Street, a nine-storey, 70-apartment build-to-rent development completed in 2019. Oceans was the group's first build-to-rent project and incorporates commercial space at ground level.

The two existing Morris projects sit further north along the same Gold Coast Highway corridor as the proposed Seabeach Avenue development. Fraser &amp; Partners' planning analysis specifically identifies both Otto and Oceans among the established built-form precedents surrounding the site.

<img alt="Seabeach Avenue and the Gold Coast Highway" data-entity-type="file" data-entity-uuid="14925119-7b71-4812-8149-340317512c7c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-20%20at%203.00.15%E2%80%AFPM.png?VersionId=aEJqYuw_nTCjcin17BSD0piB1EFotTlj" />

Mermaid Beach represents only part of Morris' considerable Gold Coast footprint.

The family-owned developer has been particularly active in neighbouring Broadbeach, delivering projects including Sierra Grand, Eclipse, Synergy, Qube, Koko, Opus and Malo, while its current pipeline includes Maison and the two-tower Crest development.

Further south, Morris has also developed a string of projects in Burleigh Heads, including Element, Boardwalk and Sandbar, while Essentia expanded its footprint north into Surfers Paradise.

The Seabeach Avenue application has been lodged by PMM Broadbeach Pty Ltd and seeks a development permit for a Material Change of Use for multiple dwellings, short-term accommodation and office uses. Zone Planning Group prepared the planning application, with Fraser &amp; Partners commissioned as architect.

The project comes as the developer continues to expand its Gold Coast pipeline while retaining a significant presence in Canberra. Morris now has more than $2.5 billion of development in its national pipeline and has delivered more than 7,000 homes during its near five-decade history

Joel Robinson

First look: Morris Property Group returns to Mermaid Beach with new Seabeach Avenue apartment development

<a data-saferedirecturl="https://www.google.com/url?q=https://www.apartments.com.au/developers/fortis&amp;source=gmail&amp;ust=1787272340808000&amp;usg=AOvVaw3hvFB2uWTRfEyEcpTSnnK9" href="https://www.apartments.com.au/developers/fortis" target="_blank">Fortis</a>&nbsp;is continuing its stronghold on Sydn​ey’s eastern suburbs apartment market, launching&nbsp;in September&nbsp;its latest boutique&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://www.apartments.com.au/developments/double-bay-nsw-2028&amp;source=gmail&amp;ust=1787272340808000&amp;usg=AOvVaw0GI5S9-wNeiLUnM-d1uYkw" href="https://www.apartments.com.au/developments/double-bay-nsw-2028" target="_blank">Double Bay</a>&nbsp;development,&nbsp;<a data-saferedirecturl="https://www.google.com/url?q=https://www.apartments.com.au/new-apartments/55-william-double-bay-55-william-street-double-bay-nsw-2028&amp;source=gmail&amp;ust=1787272340808000&amp;usg=AOvVaw2YNouJQcFjiTTgVHbgDLA-" href="https://www.apartments.com.au/new-apartments/55-william-double-bay-55-william-street-double-bay-nsw-2028" target="_blank">55 William</a>.

55 William presents&nbsp;just eight north-facing&nbsp;two-bedroom, three-bedroom and full-floor&nbsp;residences to the market, priced from $4.5 million.

The upcoming launch comes just weeks after Fortis secured approval for the $80 million development, its third eastern suburbs approval in two months. Construction is already underway, with completion targeted for 2028.

[smartcode_project:default project_id=152579 project_image_fid=376250]

55 William adds to a growing concentration of Fortis projects in and around Double Bay, a market the developer has become increasingly active in over recent years.

Fortis previously completed the nine-residence Marmont on New South Head Road, while it is currently developing a mixed-use residential and retail project at 12 Cross Street. Its wider Double Bay footprint also extends into commercial and retail development.

The developer's broader Sydney residential pipeline is particularly concentrated across the eastern suburbs, with projects spanning Doub​le Bay, Ro​se Bay, Wo​ollahra, Dar​ling Point, Poi​nt Piper and Eli​zabeth Bay.

[smartcode_project:default project_id=152579 project_image_fid=376253]

At 55 William, Fortis has again turned to MHN Design Union, the architecture practice behind several of its eastern suburbs projects, while London-based 1508 London has been appointed to handle the interiors and Wyer &amp; Co the landscaping.

The six-level building will comprise a combination of two and three-bedroom apartments, including a garden residence, full-floor apartments, a sub-penthouse and penthouse. Each residence will have secure basement parking and private outdoor space.

A rooftop terrace for all residents, along with select apartments, enjoys views across Double Bay Harbour and toward the Sydney skyline.

Ceiling heights will reach up to three metres&nbsp;in select residences, while the kitchens will feature natural stone and integrated Gaggenau appliances.

&nbsp;

&nbsp;

The boutique nature of the project reflects the type of stock Fortis has increasingly targeted across Sydney's eastern suburbs, where larger apartments and smaller buildings are being pitched primarily toward local owner-occupiers and downsizers.

Fortis Group General Manager Ed Eve said the developer continues to see demand from buyers wanting to remain in the eastern suburbs but move into newer, lower-maintenance housing.

“We're seeing continued demand from local owner-occupiers and downsizers looking for high-quality homes that allow them to remain in the eastern suburbs, close to the lifestyle and community they know,” Eve said.

55 William is also one of the early projects to respond directly to the NSW Government's Low and Mid-Rise Housing reforms. Fortis had previously secured approval for just two townhouses on the 599 sqm site before revising the scheme to eight apartments following the planning changes.

Situated one street back from Double Bay's water's edge, the project enjoys an enviable harbourside setting within walking distance of Double Bay Village and the ferry wharf.

[smartcode_project:default project_id=152579 project_image_fid=376252]

Fortis has increasingly made the eastern suburbs a major focus of its Sydney pipeline. Beyond Double Bay, it recently completed the 14-residence Piper in Point Piper and has projects underway or planned across Rose Bay, Woollahra and Darling Point.

The developer recently secured approval for Verano in Rose Bay, a six-level development comprising 21 two, three and four-bedroom apartments, also designed by MHNDU.

55 William&nbsp;is soon to be release to the market with VIP appointments commencing early September,&nbsp;with residences priced from $4.5 million.

[smartcode_project_cta:default project_id=152579]

Fortis continues eastern suburbs push with 55 William launch

UAE-based developer Arada has unveiled plans for a $2 billion twin-tower apartment development in Broadbeach, marking its first move into Queensland as it continues its rapid expansion across Australia.

Arada will develop 952 apartments across two towers on a prominent site opposite the Gold Coast Convention and Exhibition Centre, with the project targeted for completion ahead of the Brisbane 2032 Olympic and Paralympic Games.

The project represents Arada's largest commitment to the Australian market since arriving in the country in 2024 and significantly expands a local pipeline that has now grown to eight projects and more than 5,000 homes.

It will also be the first major Queensland project delivered by Roberts Co since the tier-one contractor was acquired by Arada Group in 2025.

Plus Studio has designed the Broadbeach development, which will comprise one, two and three-bedroom apartments across two towers connected by a landscaped podium.

A significant resident amenity offering will include lagoon and lap pools, a gym, sauna and steam room, alongside a mist room, infrared room and salt scrub facilities. Communal terraces, private dining areas, a library, residents' lounge and work-from-home spaces are also planned. Around 1,200 sqm of retail and hospitality space will occupy the ground floor.

The site puts Arada in one of the Gold Coast's most active apartment markets, directly opposite the convention centre and within walking distance of Pacific Fair, The Star Gold Coast and Broadbeach's dining and retail precinct.

It also has immediate access to the Gold Coast light rail network and sits just a few blocks from the beach.

Arada Group Chief Executive Ahmed Alkhoshaibi said Broadbeach represented an opportunity for the developer to expand beyond its initial NSW pipeline.

“Broadbeach is a world-class address that gives us the canvas to create a community of exceptional design and lifestyle quality that genuinely enriches the daily lives of the people who call it home,” Alkhoshaibi said.

“This is our first development outside New South Wales, and it reflects our growing ambition to grow in key urban markets around the country.”

Alkhoshaibi said bringing Roberts Co into the project would give Arada greater control over the development and construction process.

“Delivering this project through Roberts Co, our own tier-one construction business, means we can bring the quality, pace and accountability that our buyers expect.”

The move into Broadbeach comes as Arada accelerates its Australian expansion following its entry into the market two years ago. The developer has assembled a pipeline of eight projects comprising more than 5,000 homes, while the acquisition of Roberts Co last year gave the group its own Australian construction capability.

Globally, Arada has a development portfolio valued at $50 billion comprising more than 55,000 homes across the UAE, United Kingdom and Australia.

The Gold Coast is emerging as the next major market for the developer, with strong population growth and infrastructure spending ahead of the 2032 Games continuing to underpin significant apartment development across the coastal strip.

Arada plots $2 billion Broadbeach towers in major Queensland move

Sydney’s downsizer market is changing, with a growing cohort of buyers prioritising the right home over simply finding a smaller one.

Coronation Property Head of Sales Cam Porter says the traditional idea of downsizing does not necessarily reflect what many buyers are now looking for, particularly those moving from established family homes across Sydney.

Instead, he says they are increasingly becoming “right-sizers”, seeking lower-maintenance homes without sacrificing the space, amenity or quality they have become accustomed to.

“We are increasingly seeing buyers who are not motivated by the idea of simply moving into a smaller property,” Porter says.

“They are right-sizers. They want a home that is easier to manage and better connected, but they still expect generosity, quality and a floorplan that supports the way they live.”

It is a subtle but important distinction in a market where apartment developers are increasingly targeting established owner-occupiers.

[smartcode_project:default project_id=135149 project_image_fid=377495]

For many of these buyers, moving from a house to an apartment is not driven by a desire to dramatically reduce their living space. Instead, the appeal is in removing some of the maintenance associated with a larger home while retaining generous living areas, storage and enough flexibility to accommodate family and friends.

Coronation’s sales team is seeing buyers place particular importance on natural light, practical storage and additional rooms that can be used as guest bedrooms, home offices or secondary living spaces.

Kitchens and dining areas are also playing an increasingly important role, particularly for buyers who regularly entertain or have children and grandchildren visit.

[smartcode_project:default project_id=135149 project_image_fid=377494]

“These buyers still want their home to feel generous,” Porter says.

“They may want less maintenance, but they are not looking for less life.”

The challenge for the broader housing market is providing enough of the right stock to encourage that move.

While much of the discussion around Sydney’s housing shortage has centred on the number of homes being delivered, Porter says the diversity of those homes is equally important.

Older homeowners can remain in large family houses for longer when they cannot find an appropriate alternative in the neighbourhoods where they have built their lives.

“The decision is rarely as simple as wanting fewer bedrooms,” Porter says.

“People are weighing up their connection to a neighbourhood, the space they need for family, the quality of the home and whether it will continue to work for them over the long term.”

It also has implications beyond the downsizer market. Providing suitable apartments for smaller households can free up established houses for families who need the additional bedrooms and land, creating greater movement through the housing market.

<h2>Lillian targets the next stage of apartment buyer</h2>

It is a buyer Coronation is targeting at <a href="https://www.apartments.com.au/new-apartments/lillian-erskineville-9-metters-street-erskineville-nsw-2043">Lillian</a>, its new collection of apartments, terraces and penthouses at Erskineville Village.

Designed by Silvester Fuller, Lillian has been shaped around larger living spaces, natural light and flexible floorplans, alongside landscaped areas, wellness amenity and communal spaces for residents.

The development will form part of Coronation’s broader Erskineville Village precinct, which will combine new homes with green space, retail, hospitality and new pedestrian connections.

[smartcode_project:default project_id=135149 project_image_fid=377688]

McPherson Park will sit at the centre of the precinct, creating a significant new green space alongside the project’s retail and hospitality offering.

For Porter, the opportunity is to give buyers another housing option without forcing them to leave the part of Sydney they already know.

“People should be able to change the type of home they live in without having to change their entire life,” he says.

“For many buyers, Lillian offers the opportunity to remain connected to the Inner West and the city, while gaining access to a more convenient, walkable and considered way of living.”

[smartcode_project:default project_id=135149 project_image_fid=377687]

Coronation will explore the changing <a href="https://lillianresidences.com.au/news/lillian-x-space-x-downsizers-event-27-august/">right-sizer market at an event on August 27</a>, bringing together experts across property, design and lifestyle.

Held in partnership with SPACE, Poliform and Downsizer.com.au, the event will include a property market outlook from economist Michael Blythe alongside discussion around the considerations facing buyers planning their next move.

Attendees will also be able to learn more about the residences and amenity planned at Lillian Erskineville.

[smartcode_project_cta:default project_id=135149]

From downsizing to right-sizing: What Sydney buyers want from their next home

Family-owned builder and developer <a href="https://www.apartments.com.au/developers/omaya">Omaya</a> is bringing its 27-storey The Maybelle development to market, with the 229-apartment tower rising alongside Ismay Reserve near North Strathfield.

<a href="https://www.apartments.com.au/new-apartments/the-maybelle-21-parramatta-road-homebush-nsw-2140">The Maybelle</a> will comprise one, two and three-bedroom apartments, with its height providing elevated outlooks towards the Sydney skyline and Harbour Bridge, while other residences will look across neighbouring Ismay Reserve.

Designed by <a href="https://www.apartments.com.au/architects/squillace-architects">Squillace Architects</a>, the tower combines its parkside setting with proximity to the established retail, dining and transport amenity around North Strathfield.

[smartcode_project:default project_id=134873 project_image_fid=376196]

Residences will feature open-plan living spaces and a choice of two interior schemes, while communal amenity is spread across two elevated levels of the building.

Level 8 will be home to the Garden Pavilion, a full-floor resident space incorporating communal entertaining and breakout areas, seating and recreation spaces. Further up the tower, a landscaped Sky Terrace on Level 14 will provide another communal area with panoramic views towards the Harbour Bridge and Sydney skyline.

At ground level, the development sits directly alongside Ismay Reserve, where lawns, walking paths, children's play areas, picnic spaces and recreational facilities extend the green space available immediately around the project.

[smartcode_project:default project_id=134873 project_image_fid=376194]

The Maybelle is also within walking distance of North Strathfield and the Bakehouse Quarter, which provides a mix of cafés, restaurants, shops and everyday services.

Existing rail and bus services provide connections across Sydney, while the future North Strathfield Metro and access to the M4 will add to the transport options available around the precinct. Walking and cycling routes also extend via Powells Creek towards Sydney Olympic Park and its sporting, entertainment and parkland precincts.

Families are also well positioned for access to a broad selection of established schools and education options across Strathfield and the surrounding Inner West.

[smartcode_project:default project_id=134873 project_image_fid=376181]

Omaya has operated in Sydney for more than 35 years, managing projects from acquisition and design through to construction and delivery. The family-owned company is both developer and builder of The Maybelle.

Apartments start from $560,000, with the development protected by 10-year Latent Defects Insurance.

Construction is well underway, with completion expected by the end of 2026 and move-in anticipated from Q1 2027.

[smartcode_project_cta:default project_id=134873]

The Maybelle brings 27-storey parkside tower to market near North Strathfield

CBRE

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Property yields will continue to compress before bottoming in the second half of 2017, according to CBRE’s latest report.
The rate of compression in H117 differs between sectors and markets.
Bond yields are expected to rise in 2017 but with property risk premiums currently high there is room to absorb higher bond yields before property yields start to rise, says CBRE's Asia-Pacific Real Estate Outlook report.
Transaction volumes in Australia (office, retail, industrial and hotels &gt;$5 million) declined 23% from $36.5 billion in 2015 to $28.1 billion in 2016.
The decline in the number of deals was less (18%), meaning that 2016 saw average deal size shrink.
Hotels recorded the largest decline (40%), office and retail declined roughly in line with the average, and industrial declined 9%.
The key contributing factor to the decline in transactions was lower volumes of stock for sale. Investor appetite for Australian real estate remains strong.
The proportion of foreign investors declined from 40% in 2015 to 32% in 2016 but there remains a large pool of overseas capital seeking allocation in Australian real estate assets.
A main factor contributing to less stock being available for sale is that owners are increasingly happy with portfolio weightings, having invested/divested assets in active capital markets since 2012.
Furthermore, recycling capital becomes more difficult as yields approach the bottom of the cycle and there are fewer opportunities to purchase assets.
Figure 22 illustrates the inverse relationship between transaction volumes and prime office yields, noting that the trend in the latter is a reasonable proxy for all property yields.
<a href="https://www.propertyobserver.com.au/images/2017/02/22/Figure%2022.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/22/Figure%2022.jpg" alt="">
“Our forecast of rising property yields from 2018 is consistent with expectations of lower transaction volumes,” the report stated.
As for 2017, with yields levelling out in the second half, a lack of stock for sale will constrain transaction markets, as was the case in 2016.
Yield compression was recorded in all sectors in 2016 on the back of lower interest rates and continued strong buyer interest.
Compression was strongest in the office and retail sectors, in particular secondary office and large format retail (Figure 23).
<a href="https://www.propertyobserver.com.au/images/2017/02/22/Figure%2023.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/22/Figure%2023.jpg" alt="">
“We expect further, albeit moderate, compression before yields bottom in the second half of 2017.
Property risk premiums – approximated by the property yield spread over the interest rate on 10-year Australian Government Bonds – since 2011 have been at a historically high level, primarily due to low interest rates.
Figure 24 illustrates that the spread for Sydney commercial property (office, industrial and retail) has averaged 290bps since 2011.
<a href="https://www.propertyobserver.com.au/images/2017/02/22/Figure%2024.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/22/Figure%2024.jpg" alt="">
The Sydney market was used in CBRE’s analysis due to it being the most comprehensive dataset; other markets would yield a similar relationship, albeit with higher spreads.
As bond yields have trended downwards since the 1980s, property risk premiums have increased (Figure 24).
In the immediate post-GFC period, property yields blew out to their previous highs but bond yields were marginally lower – property risk premiums increased, which could be expected in the aftermath of an extreme economic shock.
The average spread (for Sydney commercial property) was 183bps.
“We see this spread as being too high in a risk-neutral market, preferring a value around 150bps, which is closer to the 135bps average observed form the late 1990s to December 20015,” the report stated.
The spread is currently around 280bps, meaning that interest rate could rise another 130bps before reaching the 150bps spread.
This is unlikely to happen, of course, but it helps illustrate the point that rising bond yields don’t immediately translate into higher property yields.
Evidence of investors moving up the risk curve can be found in changes in quality and locational compositions of the overall transaction pool.
In terms of asset quality this was apparent in the office and retail sectors, where a higher proportion of sales were secondary grade.
By contrast, the industrial sector saw the proportion of super prime and prime grade assets increase in 2016.
In terms of locational composition, in the office, retail and hotel sectors CBD sales (by number) accounted for 16% of transactions in 2015 but fell to 13% in 2016, meaning that a higher proportion of sales occurred in non-core locations.
On a risk/return basis CBRE’s near-term total return forecasts leads them to expect that investors will retain a geographical preference for the lower risk markets of Sydney and Melbourne, with the former likely to be the only capital city market to achieve total returns above the long term average (Figure 25).
<a href="https://www.propertyobserver.com.au/images/2017/02/22/Figure%2025.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/22/Figure%2025.jpg" alt="">
While Perth and Brisbane are seen as diversification plays, the near-term outlook for limited growth suggests investors will remain selective.
Yield convergence between high and low yielding real estate in 2016 was most prominent in the office and retail sectors.
This is consistent with these sectors recording a higher proportion of secondary grade transactions.
At the national level, yields on large format retail converged 25bps to (an average of) prime CBD retail and regional shopping centres.
The current spread of 228bps is consistent with the post-1999 average. Yields on secondary offices converged 22bps to prime office yields.
This trend was more pronounced in Sydney, Melbourne and Perth. Brisbane, Adelaide and West Perth bucked the trend and saw the secondary yield spread widen.
Nationally, the spread between secondary and super prime industrial was static in 2016. Strong convergence in Sydney was offset by spreads widening in Melbourne and Adelaide.
Secondary spreads for all markets except Sydney are above long-term averages.
The prospects of secondary yield convergence in 2017 will be hindered by rising interest rates and also domestic banks limiting growth in their loan books.
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j.ballantyne1990-6AQqhLzZaK

Bottom of property yield cycle nears: CBRE

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Queensland's Airlie Beach Hotel is on the market for the first time in over 30 years.
The hotel has three major street frontages and is on what is considered to be one of the most strategic land holdings on the Whitsunday coast. 
Wayne Bunz, CBRE Hotels agent said the Airlie Beach Hotel is situated on a significant 8,819sqm waterfront site, in what is arguably the best location in the Airlie Beach CBD, with never to be built out views across to the Whitsunday Island
“It has been well maintained by the family with constant capital expenditure totalling approximately $3.5 million over the past five years,” he said.
"The hotel has multiple diverse income streams including 80 accommodation rooms and conferencing, commercial car park, restaurant, pub, retail liquor, 35 gaming machines and stable retail rental income.
"The retail tenancies have a substantial Weighted Average Lease Expiry (WALE), with the first lease expiring in 2022.
“Through reconfiguring the existing uses, an operator could also increase passive income by increasing the retail floor plate (STCA), and through additional leasing.”
Christie Leet from PRD Nationwide said the property is one of the most strategic land holdings on the Whitsunday coast.
“A site of this size cannot be replicated on Airlie Beach’s Main Street, where over 60% of properties are already strata titled,” Mr Leet said.
“It is being offered at a time when the region’s tourism sector is the strongest it has ever been, with an additional 110,000 airline seats to Airlie Beach this quarter on the back of being recognised as Australia’s fastest growing regional airport.
"The strength of the market was confirmed by Tourism Whitsundays CEO Craig Turner, who said Airlie Beach is in a strong growth cycle and with the increased flights is placed extremely well for the short to medium term”.
Expressions of Interest close May 4, 2017.
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Sale plans announced for Airlie Beach Hotel

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CBRE is launching a new supply chain consultancy service in the Pacific region and have hired a senior director to oversee the venture.
Christine Miller been appointed as a senior director in CBRE’s advisory and transaction services, industrial and logistics business.
Miller was most recently director, international supply chain and major infrastructure, for XAct Solutions and will be based out of CBRE’s Western Sydney office in Parramatta.
The firm claims that the appointment is a natural extension to CBRE’s global supply chain practice group, which has existing operations in the USA and Europe.
CBRE senior managing director Matt Haddon said the firm was delighted to have someone of Miller onboard.
“Adding a supply chain consulting capability to our existing market leading business further strengthens our platform and the services we can provide our industrial and logistics clients in the Pacific region,” Haddon said.
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CBRE launches new consultancy service for Pacific region

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Nine Entertainment Co has announced plans to relocate its Sydney headquarters to North Sydney after striking a 15,500sqm lease agreement.
Nine has committed to anchor Winten Property Group’s landmark 1 Denison Street office tower, which is scheduled to be completed in early 2020.
CBRE represented Winten in the lease negotiations, which follow last year’s sale of the Channel Nine studios in Willoughby for $147,500,000.
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The North Sydney relocation announcement heralds an historic move for the network, which has been broadcasting from its Willoughby site for over 60 years.
The 1 Denison Street development will house Nine’s production, sales and digital operations.
On completion, the 39-storey, 1 Denison Street tower will be the tallest skyscraper in North Sydney.
1 Denison Street will be developed at the new centre of the North Sydney CBD, adjacent to the new Metro train station.
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The project will incorporate two levels of luxury shopping and restaurants as well as circa 60,000sqm of upper-level office space.
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Nine Network lease underpins landmark North Sydney office project

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The sale of Masters’ portfolio will result in previously standalone retail assets carved into smaller tenancies, with Chemist Warehouse, Spotlight and other tenancies expected to take up occupancy, according to CBRE’s latest report.
CBRE’s view is that this factor, in conjunction with a relatively soft retail trade environment, will lower rental growth in 2017-18.
"The implication is that there will be an increase in large format retail centre (LFR) supply over the near term," the report says.
“Our view is that LFR supply will grow on average 14% per annum over 2017-18 (assuming Masters conversions take place during this period), which is double the long-term average supply trend of 6% per annum.”
However, growth in LFR supply in metropolitan areas is estimated at 8% per annum over the next two years, not accounting for potential project delays or withdrawals.
While tenants have already secured around 80% of the Masters portfolio, there is likely to be considerable backfill vacancy over the near-to-medium-term outlook period, particularly in secondary stock.
“The housing construction cycle is entering a downturn, and we expect peak growth in household good sales is behind us for this cycle and growth of around 3% will occur over the next couple of years,” the report stated.
This will leave a gap between supply and demand over this period.
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"The gap between LFR supply and demand that we expect will occur over the next two years could be absorbed by growth in retailers that don’t traditionally occupy LFR."
The relaxation of LFR zoning laws in certain states has resulted in an increase of non-traditional retailers, Examples include gyms, supermarkets, childcare centres and government services, occupying LFR spaces.
Since the relaxation of LFR zoning laws in Victoria in 2013, there has been a shift in LFR tenancy mix to include non-traditional tenants.
There is an ongoing push for NSW to adopt a similar deregulatory path, and if this eventuates it will help cushion the impact of Masters store conversions.
Lower rents in LFR (compared to shopping centres) will make it a desirable location for non-traditional tenants such as supermarkets.
“We expect retail rent growth will moderate in 2017 amidst a soft retail trade environment,” the report stated.
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Occupancy costs declined slightly in 2016 for CBD and regional shopping centres but not enough to support strong rent growth in 2017.
National retail yields compressed on average by 50 basic points in 2016, with the largest compression in neighbourhood (60 points) and large format retail centres (60 points).
Yields are at or near record lows for most retail categories.
CBRE forecasts limited compression in 2017 before yields begin to rise from 2018 onwards.
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Smaller tenants to carve up former Masters' retail space: CBRE

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Millennials currently account for around 35% of the workforce and are expected reach 40% by 2030, according to CBRE’s latest report.
This sizeable contribution to the workforce means that millennials are major decision makers and their spending behaviour will continue to influence the way retail centres operate, the report says.
Despite the rise of online retail, millennials still prefer in-store purchases and are attracted to shopping centres that provide the “retail experience”, encompassing international brands, new food and beverage (F&amp;B) concepts and the engagement of new technology.
According to the Australian results of CBRE's APAC Consumer Survey, millennials prefer shopping centres that offer a range of F&amp;B products and international brands.
This behaviour has and will continue to drive tenancy mix changes in shopping centres, the report argues.
"Millennials on average visit a mall five days per month to shop and three days per month for reasons other than shopping; therefore it is important to create destinations that attract millennials," it said.
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Millennials a major influence on retail centre operations: CBRE

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The industrial and logistics sector has emerged as the surprise performer of Australia’s commercial property market, with rental growth and projected growth in 2017 making investors confident about the sector, according to commercial real estate firm CBRE.
Strong levels of consumption and investment spending is supporting goods demand in major markets across the country, providing a strong basis for rental growth in 2017, says the firm's Industrial and Logistics, Q4 2016, MarketView report.
In the final three months of 2016, the industrial and logistics sector recorded positive quarterly rental growth of 0.5% nationally, underpinned by strong gains in Sydney, it said. 
The figures point to the beginning of a growth period for the sector, said CBRE’s senior managing director, industrial and logistics, Pacific, Matt Haddon.
“The tide has turned, with the latest quarterly rental growth and projected growth in 2017 injecting confidence into the sector, which, despite mixed economic conditions, has continued to succeed,” Haddon said. 
“It’s well documented that the manufacturing sector is declining – and has been for years. Gains in consumption and investment spending are where our focus needs to lie, with this sector of the market driving future occupier demand growth.” 
Reduced supply in 2016 is also expected to stimulate rental growth, with just 433,000 square metres released in the December quarter – 34% lower when compared to the same period in 2015, the report says.
In terms of deals, Victoria recorded its strongest year on record in 2016, with $1.92 billion in assets changing hands – representing a 15% increase from 2015. 
The report shows $394 million in property transactions during the last three months of 2016 helped propel the Victorian market to its strongest position on record. 
CBRE senior research manager Kate Bailey said a number of high quality assets and portfolio sales had underpinned strong transaction activity in Melbourne. 
“In 2016, there was an imbalance of available premium assets and large scale opportunities to meet demand in most locations across the country – with the possible exception of Melbourne,” Bailey said. 
“Similar drivers were responsible for a slowdown in offshore investment, with portfolio sales the key driver of foreign investment in 2016.” 
Nationally, $4.831 billion in industrial and logistics assets changed hands during 2016 – marginally down from a record $5.267 billion in 2015, due to the available stock shortfall.
New South Wales recorded $1.559 billion for the year, followed by Queensland with $537.67 million, $617.2 million in Perth, $146.05 million in South Australia and $31.25 million in the ACT. 
“Global capital remains highly focused on this strongly performing segment of the commercial market,” Haddon said. 
Haddon said further compression of yields in major markets during 2016 indicated that investors were anticipating both occupier demand and rental growth in the sector. 
In Q4, super prime average yields compressed a further 10 basis points to reach record lows of 6.9% nationally, driven by a low of 6.0% in Melbourne, 6.1% in Sydney and 6.5% in Brisbane.
Haddon said current market conditions pointed to a strong year for the market. 
“Current activity levels suggest that an increased number of opportunities will be available for investors in the first quarter of 2017, compared to the same period 12 months ago.” 
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Industrial property set to soar in 2017: CBRE

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Former veteran CBRE agent Rick Butler has refuted CBRE's claims that he and his company, Richard Butler Property Advisors had allegedly "conducted business that breached confidentiality agreements with CBRE".
It was his first comments since it emerged last week that CBRE has commenced legal action seeking "substantial damages."
Despite being at the firm for 27 years, Mr Butler said he was actually retrenched in August last year.
He said he had always complied with all of his obligations to CBRE during and after his employment and would be defending his reputation.
"At 66 it's encouraging that a giant international corporation like CBRE now sees me as a threat," he told The Australian Financial Review 
"I'm grateful for the support of many clients.
"In my time at CBRE we were never afraid of competition and I'm not afraid of it now.
"Legal action will in no way distract me from my work," he said. 
CBRE has stood by its claims, the paper advised.
"We are confident in the strength of our case and we are prepared to proceed through the complete legal process to achieve a successful outcome," a spokesperson said. 
Butler, one of Australia's leading real estate agents and CBRE's lead conduit to offshore capital, left the firm last year.
It is understood CBRE commenced the legal battle last Wednesday, issuing a notice to Mr Butler and his company's lawyers, with plans to resolve the dispute through mediation and arbitration.
"Former CBRE agent, Rick Butler (now of Rick Butler Property Advisers Pty Ltd) provided advisory services to CBRE in 2016 which required that he and RBPA comply with contractual obligations relating to confidentiality, utmost good faith and fidelity, and acting in the best interest of CBRE," the company said in a statement. 
"In November 2016, a number of individuals, including Josh Cullen, tendered their resignations from CBRE to join RBPA."
 "CBRE has today taken the first steps in commencing action against RBPA and Rick Butler in relation to these events.
"These actions leave CBRE no alternative but to seek substantial damages."
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Lawyered up CBRE Australia sees veteran Rick Butler as a "threat"   

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Australia is likely to continue to attract international retail brand entrants in 2017, according to CBRE’s latest report.
Australia’s favourable macroeconomic conditions (relatively strong growth in population and consumption compared to other developed economies) and low international brand penetration (28%) to date enhance the case for entry into Australia.
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Many international retailers are entering the market and taking market share from incumbent businesses that are grappling with the lower sales growth environment and thinner profit margins.
The low penetration rate of international brands appears to have enabled high turnover per store for some new entrants.
H&amp;M’s Sydney and Melbourne stores were among the group’s best global traders with its Australian sales (per store) achieving top three results in its global platform in 2015 and 2016 and twice as productive as its average store sales globally (according to its annual results).
But new international brands entering the market and recently arrived international brads expanding will, at some point, likely cause cannibalisation of incumbent store sales and also lower sales growth for new entrants, the report says.
In some overseas markets new entrants went through a period of consolidation because initial brand rollout plans were too aggressive.
Australia would not be impervious to this scenario if brand rollouts prove overly ambitious, but we suspect that previous experiences should lend some caution to new entrants.
According to CBRE’s retail brand database (tracking about 450 international retailers globally), more than 90 existing international retailers are looking to roll out stores across Australia over the next five years, and another 50 plus brands are looking at launching their first flagship store.
“Luxury retailers were the largest group (by number) to enter Australia in 2016 and we expect this trend to continue for a further two to three years before slowing down as they reach their store targets,” the report stated.
Mid-range fashion and specialist clothing brands are expected to increasingly contribute to brand entry over the next five years.
These types of retailers have a broader target market than luxury brands, who tend to focus on CBD or super prime regional centre locations.
“We are expecting to see the second phase of fast fashion retailers expanding into suburban and regional locations,” the report says.
H&amp;M, for example, has opened numerous stores in suburban locations (typically regional shopping centres) as well as targeting major regional cities.
“We expect other fast fashion brands will follow suit over the coming years, absorbing space that may be vacated by discount department stores and other retail incumbents,” the report warned.
“We expect that over the next five years up to 1.2 million sqm or 7% of current retail stock will be sought by international retailers.
“If this occurs the level of demand is expected to almost absorb the supply pipeline (CBD and shopping centres) over the next five years, reducing the risk of oversupply.”
The upside risk is additional demand from domestic retailers, although that is not a given as the domestic retail industry has experienced profit margin pressure over the past few years.
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International brands to continue coming and setting up shop: CBRE

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Building services that support indoor environmental quality, lift performance and technology are among the top factors that drive the building selection decision, according to CBRE’s latest report.
However, current satisfaction levels amongst occupiers reflect the largest gaps between what is currently being offered and occupier expectations of these fundamental base building services.
As technology continues to evolve, the way we work is changing, creating the flexibility to work how, when and where we want; this can drive greater efficiency, supporting business growth as well as individual choice and work-life balance.
The war for talent continues to be a major focus for most organisations as they seek to attract and retain the best people.
Greater awareness is now being paid to the demands of staff and increasingly we expect to organisations evaluating their offerings to their people through location and building selection as well as workplace design.
There are now four generations represented in the workplace and this is resulting in a much more diverse workforce with differing needs and desires.
The CBRE Australian Millennials Survey: Myths and Realities revealed some of the demands of the Millennial generation around the workplace, with some surprising results.
Wellness and relaxation facilities ranked as the most influential amenity Millennials would desire when considering a new job.
At the same time, this factor also represented the biggest gap between desire and current provision in the workplace.
So what does this mean? A greater need for alignment in the real estate decision-making process between corporate real estate and human resources will emerge.
While corporate real estate has traditionally placed the greatest importance on cost, the core offering and base building services, there will be a greater shift towards the appreciation of the cost and value of an organisation’s people and ensuring that their demands are met.
This will drive an increasing demand for some of the softer tenant services and building differentiators such as wellness facilities and customer experience offerings such as concierge services.
According to CBRE’s Occupier Survey, the trend for workplace design is heading towards a more agile workplace format or one which endangers higher performance amongst employees.
An increasing number of occupiers planning a near-term redesign indicated they intend to implement this style of workplace format.
Occupiers who had redesigned in the past two years and adopted a more agile workplace format reported higher success ratings in achieving a number of business objectives, particularly around the areas of achieving knowledge sharing, collaboration and effective use of space.
They also gave the highest ratings in terms of their new workplace format increasing employee productivity, helping to attract and retain staff and improving the on-boarding of new and junior staff.
A high performance workplace format should be designed to enable employees to do their jobs in the most effective and efficient manner whilst also inspiring them and supporting their comfort and wellness.
Ultimately the goal of a high-performance workplace is to increase employee productivity and thus business profitability.
The next frontier in the evolution of occupier demand will be the expectation of an enhanced customer experience offering.
There is an increasing recognition that the customer relationship is now evolving beyond that of the landlord and the representative of the tenant that signs the lease.
It is now extending to include occupants of and visitors to the building.
With more diversity in the workforce, a more flexible approach to work and an increasing focus on wellness and work-life balance.
It will be imperative for landlords and building managers to ensure they are delivering an enhanced customer service experience to gain a competitive advantage in the marketplace and strengthen the landlord/occupier relationship.
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