Queensland builder-developer MAYD has revealed the first look at its major North Kirra beachfront development, lodging amended plans that reduce the number of apartments and increase the proportion of larger residences.

The project is planned across a substantial 4,742 sqm amalgamated site spanning seven lots at <a href="https://www.apartments.com.au/new-apartments/2-6-pacific-parade-bilinga-qld-4225">2-6 Pacific Parade</a> and 27-33 Golden Four Drive in Bilin​ga, directly opposite Nor​th Kirra Beach.

<a href="https://www.apartments.com.au/developers/mayd-group">MAYD</a> secured the site for $32.5 million in 2025, in what was one of the Gold Coast's largest property transactions of the year.

The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.

The latest amendments seek to reduce the overall apartment count and shift the project further toward the owner-occupier market, with larger residences designed for buyers wanting considerably more space than traditionally offered in a beachfront apartment.

The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.

MAYD has appointed Cera Stribley to lead the architecture and interiors, with the Melbourne-based design practice drawing on the beachfront setting through a series of ocean-facing terraces and heavily landscaped balconies.

Strong horizontal forms and curved balconies will define the exterior, with subtropical landscaping integrated throughout the building to soften the built form and increase the connection between the residences and the beachfront.

The project will also include an extensive collection of resident wellness and lifestyle facilities, continuing the broader shift across the Gold Coast's luxury apartment market toward larger homes supported by resort-style amenity.

<img alt="MAYD" data-entity-type="file" data-entity-uuid="d1bcbb05-e659-4b47-8bd4-1e595315e2ad" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%202.05.03%E2%80%AFPM.png?VersionId=jj0XEud1X1DuLt7_KyElhjMdZGOXmLHP" />

MAYD Founder Todd Mould said North Kirra was increasingly appealing to buyers attracted to the more established, lower-density character of the southern Gold Coast.

"North Kirra presents one of the most compelling luxury residential opportunities currently emerging in Australia, combining absolute beachfront with the character and authenticity that buyers are increasingly seeking, and the same sense of tight-knit community that defined Burleigh and Currumbin perhaps 10 or 15 years ago," Mould said.

"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."

The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.

Kirra in particular has emerged as one of the region's more tightly held beachfront markets, with its relatively low-density character, established surf and hospitality scene and proximity to Gold Coast Airport differentiating it from the higher-density markets further north.

Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.

"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.

"Inspired by the coastline itself, the architecture has been shaped around space, privacy and resort-style living, creating a collection of homes that reflects the next generation of luxury on the southern Gold Coast."

MOTIV Managing Director Carly Cottam, who has been appointed to market the project, said buyer attention had continued to move south along the Gold Coast.

"Purchasers who may once have defaulted to Broadbeach, Main Beach or Surfers Paradise are increasingly recognising the value of a genuine beachfront location that offers lower density, strong amenity and a more established sense of community," Cottam said.

"Kirra has a powerful combination of growing demand and genuine scarcity. Beachfront supply is inherently constrained, the area remains relatively low density, and buyers are increasingly placing a premium on locations that feel established, uncrowded and authentic rather than heavily developed."

Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.

"Being minutes from Gold Coast Airport makes it particularly compelling for interstate buyers, frequent travellers and second-home purchasers who can access an authentic coastal lifestyle almost immediately after stepping off a flight."

The acquisition takes MAYD's active development portfolio to more than $500 million, with the North Kirra project representing one of its largest undertakings to date.

MAYD is targeting an early 2027 launch.

Joel Robinson

First look at MAYD's North Kirra mixed-use precinct

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Castle Hill, the longtime hub of the Hills District, has been one of the major beneficiaries of Sydney's Metro expansion, with improved connectivity helping drive continued population growth, development and buyer demand across the Hills District.

But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.

Hills District developer Reve Group is looking to fill that gap with <a href="https://www.apartments.com.au/new-apartments/nova-r-ve-castle-hill-2-garthowen-crescent-castle-hill-nsw-2154">Nova Rêve</a>, a major new mixed-use precinct on the corner of Garthowen Crescent and Old Castle Hill Road, a short walk from Castle Hill Metro Station and Castle Towers.

[smartcode_project:default project_id=152737 project_image_fid=377679]

The project will comprise three residential towers alongside a hotel, restaurants, cafes and a skybar, more than 1,600 sqm of ground-floor retail and almost an acre of landscaped gardens.

It represents the largest project undertaken by Reve Group, the development arm of the Kassis family, which has been building across the Hills District for more than 30 years through Kassis Homes.

[smartcode_project:default project_id=152737 project_image_fid=377675]

Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.

Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.

Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.

[smartcode_project:default project_id=152737 project_image_fid=377685]

Reve Group Managing Director Sam Kassis said the project reflected the family's three decades of building in the Hills, which has evolved from trophy homes on quarter-acre blocks to larger-scale apartment development.

"Grand Rêve was our first apartment project here and it showed us what this pocket of Castle Hill could be. Nova Rêve is the refinement of that idea: not just apartments, but a place the whole suburb can use," Kassis said.

A key part of that approach is the hotel, which has been designed to operate as an amenity for the wider Castle Hill community rather than solely hotel guests.

It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.

At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.

Almost an acre of gardens designed by Land and Form Studios will run through the precinct, incorporating pathways, seating, barbecue areas and children's play spaces.

[smartcode_project:default project_id=152737 project_image_fid=377680]

Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.

"There are gardens with pathways, barbecues, seating and play areas, shops and cafes opening onto the street, and a hotel with restaurants and a skybar that anyone in Castle Hill can walk into," Georges said.

The project's elevated position on one of Sydney's highest ridgelines will also provide apartments with outlooks toward the Sydney skyline, surrounding parkland and the Blue Mountains.

More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.

&nbsp;

[smartcode_project_cta:default project_id=152737]

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Nova Rêve arrives as Reve Group bets on Castle Hill's next growth phase

A collection of just 25 large-format apartments and penthouses overlooking Goodwin Park is entering the Coolangatta market, with <a href="https://www.apartments.com.au/new-apartments/marea-residences-coolangatta-27-27a-dixon-street-coolangatta-qld-4225">Maréa Residences</a> combining a low-density, residential-only approach with uninterrupted park and Pacific Ocean outlooks.

Located at 27 Dixon Street, Maréa comprises three and four-bedroom residences alongside a limited number of dual-level penthouses, with the project positioned between Goodwin Park and <a href="https://www.apartments.com.au/developments/coolangatta-qld-4225">Coolangatta</a>’s coastal precinct.

Construction has commenced, with completion currently estimated for late 2027. Three-bedroom residences are priced from $1.8 million.

[smartcode_project:default project_id=150999 project_image_fid=374005]

The project has been designed around its northern outlook across the park, with the building’s architecture, landscaping and material palette intended to establish a connection with the neighbouring green space. The residences have been configured to maximise natural light and views across Goodwin Park towards the ocean.

Inside, the material palette incorporates timber, stone and brushed brass, complemented by curved detailing and ambient lighting. Kitchens and bathrooms carry the same natural material approach, while residences also include basement parking, storage and lift access.

Maréa’s penthouses are arranged over two levels and include private pools, adding another layer to the project’s focus on larger-format apartment living. Across the development, residences are configured with three or four bedrooms rather than the broader mix of smaller apartment types commonly found in larger projects.

[smartcode_project:default project_id=150999 project_image_fid=374010]

Resident amenity is concentrated at rooftop level, where landscaped entertaining terraces and pools take advantage of elevated views across Coolangatta and the Pacific Ocean.

The project has so far been particularly well received by local owner-occupiers and downsizers, according to Urban Activation Property Sales and Marketing Director Matt George, with the residential-only format, construction quality and northern park outlook among the features resonating with purchasers.

“The uninterrupted northern aspect overlooking Goodwin Park has been a key point of difference, with buyers attracted to the sense of serenity and open space the park provides, while still enjoying easy access to the ocean and being within walking distance of the lifestyle and amenities Coolangatta has to offer,” George said.

[smartcode_project:default project_id=150999 project_image_fid=374002]

“The combination of high-quality construction, a residential-only building, park outlook and proximity to the beach has resonated strongly with the local downsizer market.”

The Dixon Street address is within walking distance of Coolangatta Beach and the broader southern Gold Coast coastline, including the surf breaks at Snapper Rocks and Kirra. Coolangatta’s cafés, restaurants and retail are nearby, while Gold Coast Airport is also within close proximity.

[smartcode_project_cta:default project_id=150999]

Maréa Residences brings parkside apartments to Coolangatta

Melbourne developer PDG has secured Victorian Government approval for its $1.5 billion Southbank development <a href="https://www.apartments.com.au/new-apartments/the-one-1-queens-bridge-street-southbank-vic-3006">The One</a>, clearing the way for the long-dormant riverfront site opposite Crown to finally be developed.

The Minister for Planning has approved the project at 1-29 Queens Bridge Street, with the Department of Transport and Planning issuing the planning permit following its assessment.

The approval will allow PDG to develop the prominent 5,059 sqm site with a major mixed-use tower comprising premium apartments, including branded residences, a luxury hotel and boutique office space.

PDG acquired the site in late 2024, with its position directly opposite Crown's main entrance and near Melbourne's Arts Precinct making it one of Southbank's most significant remaining development opportunities.

<img alt="PDG" data-entity-type="file" data-entity-uuid="3933013e-6332-4386-b9be-089df05caf17" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%209.29.22%E2%80%AFAM.png?VersionId=sITIgBqDL0N3VNSMwWEmF5UA.uvcsRyu" />

Designed by COX in collaboration with ODO and PDG, the tower's architecture draws on the movement of the Yarra River, with six vertical pleats running the height of the sculpted facade.

The project will also see the heritage-listed Queens Bridge Hotel restored and incorporated into the development&nbsp;with new hospitality and public uses, including a rooftop venue.

A significant component of The One will be its residential amenity.

More than 5,000 sqm of resident facilities will be delivered across a single level, making it one of the largest consolidated residential amenity offerings proposed in an Australian apartment development.

The planning approval also incorporates a major upgrade of Queensbridge Square, which PDG will deliver in partnership with the City of Melbourne.

<img alt="PDG" data-entity-type="file" data-entity-uuid="73167fcd-1031-4b6f-a408-a064cfe45ed1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%209.29.17%E2%80%AFAM.png?VersionId=Pf1AEWxw6SNmBqR0zQW5lyEze.MtxgFp" />

The existing square will be revitalised as a new civic and pedestrian space along the Yarra River, strengthening the connection between the project, Southbank and the riverfront.

PDG Founder and Managing Director Vince Giuliano said the approval represented a major milestone for a site which has remained largely underutilised for more than 15 years.

“This is the most significant Planning Permit approval Melbourne has seen in recent years,” Giuliano said.

“For more than 15 years, this site has remained underutilised. This approval enables us to deliver a project that will contribute meaningfully to the revitalisation of Southbank, restore and reactivate an important heritage building, and create a new civic and hospitality destination for Melbourne.”

The latest approval follows an earlier planning permit issued by the City of Melbourne covering demolition works across part of the site at 9-29 Queens Bridge Street. Those demolition and early works are already underway.

PDG has also started generating early interest in the residential component from owner-occupiers ahead of a planned public launch in early 2027.

PDG secures approval for $1.5bn Southbank apartment development, The One

Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

First look: Harridan plans Burke Street transformation beside Boggo Road transport hub

Retail

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Remember when our retail spend was shifting from buying things to buying experiences? That was only four months ago.
Since then, Australians have been spending more at supermarkets and on consumer electronics than on apparel and at department stores. Our expenditure on experiences, in particular travel, has been almost non-existent. It was therefore interesting to hear that in China there has been a rebound in luxury spending post COVID-19 lockdowns.
(Spending excessively after a period when one has had limited opportunities to spend has emerged after the lockdown, where in several Chinese cities, consumers flocked the various brand outlets to beat the lockdown blues.)
The most recent retail trade data for May did show an element of ‘revenge spending’ by Australian consumers. After plunging 17.7% in April, spending bounced back 16.3% in May. June is likely to look similarly positive, although, the Melbourne lockdowns are likely to start to drag it back again in July.
At the beginning of the first lockdown in mid-March, I thought that the most impacted property sector would be shopping centres, but it has remained surprisingly resilient despite the enormous challenges for retailers.
While the sector has remained somewhat resilient, the vacancy rate has risen. According to JLL, the national average shopping centre vacancy rate rose to 5.1% in June from 3.8% six months earlier. This rate excluded temporary closures.
By far the most impacted precincts have been CBDs where the vacancy rate has now hit 10%. Working from home has been disastrous for CBD retailing. The other big shift has been the acceleration of online retailing. In a three-month time period, it has gone from 9% of retail sales to 10.5%. Not exactly a runaway pace but a sharp increase over a short time period.
For now, our expenditure on travel, eating out and entertainment outside the home is likely to remain far more muted. Meanwhile expenditure at supermarkets and on takeaway food is likely to be far more positive. While I can’t see myself rushing out to buy luxury brands any time soon, the rush to the shops in China is hopefully a good news story for shopping centres over the next 12 months.
NERIDA CONISBEE is the Chief Economist at REA
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Can revenge spending help save retail property? REA's Nerida Conisbee

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The long-standing Tewantin Market Garden on the Sunshine Coast has been snapped up for $1,025,000.
The 142sqm property at Shop <a href="https://ecomms.raywhite.com/collect/click.aspx?u=OEliUjcxeWE1ZEs2R3BZaUU4MjFYTFMzUWNUeUVSUVRzYlJqamhlUkd0Z1UrTkh0T2JQYy9wMGZuVUhVano0UzFCZkZoZXJucy9NUFVacFZLaE4rcWVBVFJXTjhhYTUxZW5oU2VlbXg0RVFxYUhQZDVxcitXZ1hKZTJKWlRYUE1FbVp4STQxOXJhd3BOcXkrNVM4TE1jMXc5M3hpZ3BkSTFseFNRMG1tZ1BOTTJIbkVUUDF1M3M1OFYreC9sNGI3&amp;rh=ff00611b95e6ae1e74f00323784ab13e69fb5d9d" target="_blank" rel="noopener noreferrer" data-auth="NotApplicable">2/93 Poinciana Avenue</a> was completed in 2016 and formed part of the ‘Tewantin Place’ strata complex.
It was sold by David Brinkley and Tracey Ryan from Ray White Commercial Noosa and Sunshine Coast North to an interstate investor. 
Tewantin Market Garden relocated from a below street level position within Tewantin Plaza further up the street. 
<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/2020/5/18/a%20U2%2093Poinciana%20Jul19%204.jpg" alt="">
“The tenants had made the decision to relocate to this site on the Poinciana street front to enhanced their business and benefited their customers," Brinkley said.
The property was first for sale as an off-market proposition until final agreement was reached five months later.    "Tewantin is a busy retail centre which is undergoing a revitalisation as the demographic in the area moves away from retirees to young families investing in the large blocks at prices slightly below neighbouring Noosa," Brinkley said. 
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Tewantin Market Garden freehold sells for $1 million

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The Priceline Pharmacy building in the Sunshine Coast suburb of Caloundra at 66 Bullock Street has been offered to the market
The property, 100 per cent leased to Star Pharmacy Group Pty Ltd, is being offered for sale via an expressions of interest campaign.
The asset is being marketed and sold by Ray White Commercial QLD father and son duo Stephen and Elliot Kidd, in conjunction with Henzells Commercial Real Estate’s Paul Bell.
Mr Stephen Kidd said the two-level commercial building was in the heart of one of the Sunshine Coast’s most popular tourist destinations.
“A new corporate head lease from the Star Pharmacy Group over the entire building is being offered, with the ground floor retail occupied by Priceline Pharmacy and upstairs previously used as a function room,” he said.
“The current net income produces $166,340 after all deductions, including land tax.”
Mr Elliot Kidd said Star Pharmacy Group acquired and refurbished their tenancy in 2016.
“The ground floor income is underwritten by a fresh five-year corporate lease with options until 2045,” he said.
Mr Bell said the upper level comprised open-plan accommodation that was currently fitted out for an entertainment venue.
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Priceline Pharmacy building in Sunshine Coast's Caloundra listed

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EXPERT OBSERVER
March retail trade figures released from the Australian Bureau of Statistics reporting year-on-year growth of 10.1%, were consistent with expectations of strong pre-lockdown specific category growth, whilst the majority of retailers shut their doors for COVID-19 lockdown.
The figures confirm stronger expenditure year-on-year across food (+27.2%), liquor (+33.9%) and pharmacy (+29.4%) categories, and a sales boost in household goods (+10.3%) as Australians adapted to restrictions and stocked up on additional items for lockdown.
March was the eye of the COVID-19 storm for retailers, with all but essential service retailers forced into closure of their physical stores during lockdown. Whilst that pain of closure has continued during April and into May, we have seen some gentle upside begin as many stores enhance their online and delivery services. 
Since the COVID-19 pandemic began, we have anticipated a spike in certain categories as people adjust to restrictions, but these increases mask bigger falls across discretionary categories, which has proved a significant challenge.
It’s been unquestionably tough for retailers, and the true recovery picture won’t start to emerge until physical stores reopen more fully in the coming weeks. We are likely to see a phased re-opening - retailers have different considerations some will open key stores and wait to open others. Some have cafes attached and will need to delay that area opening. Others are still negotiating with landlords.
Whilst we expect Australians to soon celebrate their freedom with one of their favourite leisure activities - shopping - we do anticipate continued caution by consumers for some months forward as they assess overall economic conditions.
Category-specific trends
While month-on-month supermarket sales are up 23% in March, these figures have confirmed our expectations of significant falls in sales across discretionary categories. Clothing, footwear, and personal accessories recorded significant falls (-22.6%).
Retailers have swiftly adapted to the new conditions, with a jump in online sales set to become the new normal.
Online sales have skyrocketed, and we expect that shopping habits we have seen will be permanent, as retailers offer new options such as kerb-side pickup and retail-to-go options.
I anticipate some enthusiasm from consumers as stores prepared for reopening, and said his desire was for the reopening to be sustainable and safe as people returned to retail stores.
The safety of customers and staff is our top priority, and retailers are making every effort to prepare a safe in-store environment. New in-store measures such as social distancing, increased hygiene and cleaning, and Perspex screens where appropriate, will be here to stay, even as restrictions are gradually eased.
ARA will release its Retail Reopening Guidelines tomorrow morning.
Monthly Retail Growth (February 2020 – March 2020, seasonally adjusted)
Department stores (-8.9%), Food retailing (24.1%), Household goods retailing (9.1%), Cafés, restaurants and takeaway food services (-22.9%), Other retailing (16.6%), and Clothing, footwear and personal accessory retailing (-22.6%).
Western Australia (9.9%), Australian Capital Territory (9.5%), Queensland (8.9%), Victoria (7.7%), South Australia (9.4%), Tasmania (8.9%), New South Wales (8.0%), and Northern Territory (11.6%).
Overall month-on-month sales growth: 8.5%.
Year-on-Year Retail Growth (March 2019 – March 2020, seasonally adjusted)
Food retailing (27.2%), Cafés, restaurants and takeaway food services (-22.6%), Other retailing (19.1%), Household goods retailing (10.3%), and Department stores (-6.6%), and Clothing, footwear and personal accessory retailing (-24.9%).
Tasmania (15.1%), Queensland (13.2%), Victoria (9.4%), Western Australia (13.5%), Australian Capital Territory (11.0%), South Australia (10.2%), Northern Territory (10.8%), and New South Wales (7.1%).
Overall year-on-year sales growth: 10.1%.
Paul Zahra is the chief executive of the Australian Retailers Association
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ARA looks towards May as start of retail recovery

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EXPERT OBSERVER
Consumers stockpiled food and supermarket groceries in February ahead of restrictive self-isolation and social distancing measures announced by governments to counter the fast-spreading coronavirus (COVID-19) outbreak.
Retail spending grew by a solid 0.5 per cent in February – the second strongest growth rate in 12 months. But this followed declines in spending of 0.6 per cent in December and 0.3 per cent in January, due to disruptions from big city smoke hazes and the bushfire emergency.
Many Aussie retailers decided to close their businesses before government orders to shut down to protect both the health of their employees and customers from the ravages of the virus. Tens of thousands of workers in the retail trade industry were stood down indefinitely. And shoppers decided to scale-back purchases of non-essential discretionary goods, such as clothing and footwear. In fact spending on shoes and apparel fell by 2.3 per cent over the year to February – the biggest annual decline since 2011.
Consumer caution is also evident in spending on motor vehicles. As Aussies began to hibernate from the virus at home, national new vehicle sales posted their weakest March month in 11 years.
Aussie builders and construction workers are in for a tough time over the next few months. According to the AiGroup, construction businesses reported that, “Economic uncertainty due to the COVID-19 pandemic has dampened client confidence, increased risk aversion and lowered demand. Some businesses reported supply disruptions due to COVID-19 measures, particularly for imported building materials.”
Retail trade – February
‘Final’ retail trade rose by 0.5 per cent in February, above the preliminary Bureau of Statistics (ABS) estimate of 0.4 per cent. The lift in spending follows spending declines of 0.3 per cent in January and 0.6 per cent in December. The annual growth rate fell from 2.0 per cent to 1.8 per cent – the weakest rate in over 2 years.
Non-food retailing rose by 0.2 per cent in February following a 0.8 per cent decline in January. But the annual growth fell from 1.4 per cent to 1.0 per cent – the slowest growth rate in over 2 years.
Sales by chain-store retailers and other large retailers rose by 0.3 per cent in February to be up 1.8 per cent from a year ago – the weakest annual growth rate in over 2 years.
The share of online retailing rose from 5.6 per cent to 6.6 per cent over the year to February.
Spending rose most in February: Department stores (up 3.1 per cent); Pharmaceutical, cosmetic and toiletry goods retailing (up 2.2 per cent); Hardware, building and garden supplies retailing (up 1.3 per cent); and Supermarket and grocery stores (up 1.1 per cent).
Spending fell most in February: Clothing retailing (down 3.1 per cent); Footwear and other personal accessory retailing (down 2.4 per cent); and Newspaper and book retailing (down 2.0 per cent).
Across states/territories in February: Spending rose the most in Western Australia (1.2 per cent), followed by the ACT (up 1.1 per cent), Queensland (up 0.8 per cent), Victoria (up 0.5 per cent), South Australia (up 0.4 per cent). Tasmania and NSW were broadly unchanged. Spending in the Northern Territory fell by 0.7 per cent.
New vehicle sales - March
The Federal Chamber of Automotive Industries reported: “The March 2020 market of 81,690 new vehicle sales is a decrease of 17,752 vehicle sales or -17.9 per cent on March 2019 (99,442) vehicle sales. March 2020 had the same number of selling days as March 2019 (25.5) and this resulted in a decrease of 696.2 vehicle sales per day.”
“The Passenger Vehicle Market is down by 7,222 vehicle sales (-24.9 per cent) over the same month last year; the Sports Utility Market is down by 6,489 vehicle sales (-14.2 per cent); the Light Commercial Market is down by 3,326 vehicle sales (-15.5 per cent); and the Heavy Commercial Vehicle Market is down by 715 vehicle sales (-21.7 per cent) versus March 2019.”
Sales across states and territories over year to March: NSW (down 16.4 per cent); Victoria (down 21.3 per cent); Queensland (down 20.2 per cent); South Australia (down 27.9 per cent); Western Australia (down 14.4 per cent); Tasmania (down 21.2 per cent); Northern Territory (down 33.5 per cent); ACT (up 77.0 per cent).
The biggest selling vehicle in March was the Toyota Hi-Lux (3,556) from the Ford Ranger (3,108) and Toyota RAV4 (2,991).
The rolling annual total of new vehicle sales in March was 1,027,690, down 9.1 per cent on the year after falling 8.1 per cent in the year to February. Passenger car sales fell by 17.6 per cent on the year with SUVs down 2.6 per cent and “other vehicles” down 9.8 per cent.
In the year to March, SUVs accounted for a record 61.7 per cent of combined SUV and passenger vehicle sales.
Services Purchasing Managers’ index - March
The ‘final’ CBA/IHS Markit Services Purchasing Managers' Index fell from 49.0 points in February to a record low 38.5 points in March. Any reading below 50 indicates a contraction in activity.
According to the CBA and IHS Markit, “The global outbreak of the coronavirus disease 2019 (COVID-19) weighed heavily on the Australian service sector in March, with the latest PMI data showing a slump in business activity. This was concurrent with a deepening downturn in new sales, led by a record fall in new overseas business. With backlogs of work falling markedly, firms reduced jobs further. Business confidence also fell to a survey-record low, while price pressures moderated.”
Performance of Construction - March
The Performance of Construction index (PCI) fell by 4.8 points to 37.9 points in March – the lowest level since May 2013. A reading below 50 points indicates construction activity is contracting.
Construction activity (down 6.0 points to 39.1 points) and, new orders (down 10.3 points to 35.4 points) fell by the most. Construction employment fell by just 0.5 points to 36.4 points, depressed at the second lowest level in 7 years.
By sector, house building lifted by 0.3 points to 53.2 points in trend terms, but apartment (down 1.5 points to 31.9 points), commercial construction (down 1.6 points to 35.1 points) and engineering activity (up 2 points to 42.2 points) all contracted in March.
According to the AiGroup, “The Australian PCI® suggests that house building activity has remained resilient in 2020 to date, although contacting new orders and the sector’s vulnerability to the deteriorating COVID-19 situation will weigh more heavily on conditions in coming months. In other sectors, activity is experiencing on-going declines amid a weak flow of work opportunities and new invitations to tender.”
And, “Respondents in the Australian PCI® reported further price rises for imported materials and subsequent pressure on margins due to the weak Australian dollar. Businesses are bracing for worsening construction conditions as virus-related impacts on economic activity and demand increase.”
What are the implications for interest rates and investors?
The next preliminary retail trade data from the Bureau of Statistics is not due until the week of April 20. The nation’s statisticians are having some difficulty obtaining spending data – with trend series data unavailable in February – due to COVID-19 associated disruptions.
But more timely data on consumer spending patterns is available from both the Commonwealth Bank (CBA) and Kepler Analytics. According to Kepler Analytics data, shopping centre foot traffic fell by 56 per cent in the week ended March 29 from a year ago. And around 55 per cent of stores had closed nationally by March 31. Retailers have also acted to cut fixed costs, such as wages and rent. And some retailers are remaining open by focusing on online sales. Of course, the announced JobKeeper government wage subsidy is also designed to cover store wages – where possible – and keep retail employees attached to their jobs ahead of an eventual recovery.
And recent weekly CBA credit &amp; debit card spending shows strong increases in consumer spending on food and alcohol, as well as on household furnishings and equipment. But spending on clothing, transport, recreation and personal care – all deemed “non-essential” due to self-isolation measures – continue to decline.
The slowing in demand for new residential homes is evidenced by the sharp slowdown in new orders for both apartments and houses. Commercial construction new orders declined for a 20th successive month. And engineering new orders also weakened “due to a lack of new contracts to replace completed infrastructure projects”, according to the AiGroup.
CRAIG JAMES is the Chief Economist at CommSec
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Biggest fall in clothing sales in 8 plus years: CommSec's Craig James

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The sale of 33 convenience retail outlets owned by 7-Eleven was considered very successful with a 100% clearance rate.
They sold for a combined $156 million.
Commercial agency Burgess Rawson successfully auctioned a final group of 18 properties at a 100% clearance rate earrlier this week. They previously sold an additional 15 of the company’s outlets at an auction in October 2019.
All properties sold on Tuesday traded on a blended yield of 4.83%, with one asset at Wahroonga in Sydney achieving a noteworthy yield of just 2.5% after selling for $4.67 million.
A further eight outlets sold on yields in the 4% range, including one in Penrith South, which was declared on the market on its first bid and reached $4.56 million, while another property at Pascoe Vale in Melbourne’s north sold for $4.775 million on a 4.09% yield.
Burgess Rawson director Billy Holderhead, who marketed the portfolio with colleagues Jamie Perlinger and Simon Staddon, and with Charter Keck Cramer’s Andrew Grant, Jessica Crossland and Tom Byrnes as transaction advisors, said the auctions had been runaway successes.
“Without a doubt this is one of the most successful – if not the most successful – commercial portfolios ever transacted in Australia,” Mr Holderhead said.
Mr Perlinger added – “Today’s auction alone was attended by 144 bidders and generated an estimated buyer pool of more than $550 million, which is a very clear indication that there is still a significant amount of unsatisfied demand in the fuel and convenience retail market.”
The properties featured new 12-year leases, indicating the belief in 7-Eleven as a brand and business model.
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33 7-Eleven outlets auctioned with 100% clearance rate

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Melbourne CBD’s premier retail thoroughfare Swanston Street will offer the first test of the market for 2020, with a family offering for sale a building it has held for 70 years.
CBRE’s Melbourne City Sales team have been appointed to market 273 Swanston Street, which is set to go to auction on March 12.
It is next to the McDonald’s on the corner of Lonsdale Street and Swanston Street. 
In the Melbourne CBD’s booming northern precinct between Melbourne Central, Emporium Melbourne and QV Melbourne, the property is being offered to the market fully leased to an established hospitality operator.
“Swanston Street has long been regarded as Melbourne CBD’s most highly desirable and tightly held street of property ownership and this is truly a once in a lifetime opportunity,” Alex Brierley said.
Over the past five years Swanston Street has been transformed from a retail strip to food and beverage destination catering to Melbourne CBD’s booming student population. 
Recent food and beverage leasing deals along Swanston Street have achieved rentals as high as $6,000 per square metre for smaller shops.
In a landmark deal, the former Jack London retail store at 301 Swanston Street was leased to popular chain David’s Hot Pot for approximately $400,000, for the 107 square metre ground floor space, negotiated by CBRE’s Zelman Ainsworth and Tan Thach.
“273 Swanston Street is well positioned to benefit from GPT’s new 10-level office tower that will sit atop Melbourne Central mall at 300 Lonsdale Street, which will drive rental growth well into the future,” Julian White added.
The last building to transact on Swanston Street was the 1930s-style, heritage 123 Swanston Street, which sold for just under $16 million, reflecting a 2.75 per cent yield, in 2015.
 
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70-year wait for Swanston Street building in Melbourne: CBRE

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NAB data mapping suggests that the ABS retail trade measure will fall 0.1% m/m in December following a gain of 0.9% in November.
The ABS printed a 0.9% gain in November, while NAB forecast 0.6% (revised to 0.5%). The strong November print is likely a result of the relatively new Black Friday sales bringing forward Christmas spending into November. 
Beyond technical questions around seasonal factors, this points to ongoing weakness in the retail sector amid high consumer debt levels and sluggish wage growth.
It is unlikely that the sector will see a sustained lift any time soon. On the contrary, the catastrophic bushfire season may further damage consumer confidence in January and February.
Click <a href="https://www.propertyobserver.com.au/images/2020/1/22/NAB%20Retail%20Index%20DEC.JPG" target="_blank">here</a> to enlarge:
<img src="https://www.urban.com.au/images/2020/1/22/NAB%20Retail%20Index%20DEC.JPG" alt="">
NAB Group Chief Economist Alan Oster said, "the retail sector has numerous fundamental issues; unemployment is set to edge higher, sluggish wage growth and elevated consumer debt continue to dampen consumer sentiment, despite interest rate cuts and higher house and share prices."
"In parallel to our standard mapping equations, we are running an experimental methodology. This alternative methodology forecast a bigger rise in November and an even weaker result in December."
"If anything, our December forecast has downside risk."
"The current bushfire season – underway since September – is a national tragedy. The local economic impact in bushfire-affected areas has been extreme."
"While it is unlikely that the fires were a major influence on the national December retail data, there may be much more substantial second round impacts in January and February," he concluded.
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Weakness in the retail sector exacerbated by bushfires: NAB

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A retail site on Burke Road in Camberwell has sold for $4,415,000.
The 205 sqm building at 769-771 Burke Road was purchased by a South Australian investor following a competitive auction that attracted six bidders.
The shop is located between the intersection of Burke, Riverside and Camberwell Roads and Camberwell train station, and adjacent to the Camberwell Place Shopping Centre.
It is currently leased to apparel retailer Lululemon Athletica.
CBRE’s Mark Wizel, Rorey James, Nick Hage and JJ Heng managed the campaign, with the property attracting a mix of domestic and international interest.
The purchase price translates to a building rate of $21,536 sqm, and follows the sales of 755 Burke Road for $5.05 million and 509-513 Riverside Road for $4.65 million.
Mr Wizel said, "we are expecting similar levels of demand and confidence in CBRE’s remaining retail opportunities in the build-up to Christmas."
“The current low interest rates and reduced supply of quality retail opportunities through the first half of 2019 has resulted in a flight to quality from investors seeking an alternative to declining term deposit rates,” he concluded
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Burke Road, Camberwell shop sold for $4.4 million

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It has been a tough year for the retail sector so far in 2019 and the upcoming festive spending will likely do little to change that underwhelming result, according to the latest quarterly retail forecast from Deloitte Access Economics.
It reported that weak wage growth, high debt levels and increasing price pressures are hurting demand, while tax returns and interest rate cuts have yet to fully come through.
However there is some positive news, with 2020 holding more promise.
According to Deloitte Access Economics’ latest quarterly Retail Forecasts subscriber report (Q4 2019):
<ol>
<li>Retail sales in September posted the weakest result since the 1990s recession, falling 0.2% over the year</li>
<li>Retail price pressures remain strong, eating away at volumes growth as households struggle with weak wage growth and high debt levels</li>
<li>Tax offsets and lower interest rates provided limited support to consumer spend to date</li>
<li>The outlook for 2020 is more positive with retail spending expected to grow 2.6% over the year.</li>
</ol>
"Retail sales look to be ending 2019 on a relatively soft note as consumers face increasing budget pressures, said Deloitte Access Economics partner and Retail Forecasts principal author David Rumbens.
"Stagnating wage growth and weak house prices have limited consumer willingness to spend, while tax offsets and interest rate cuts have yet to translate to sales. And with retail prices increasing, spending volumes have taken the hit posting the weakest growth since the 1990s recession.
"The start of the Christmas season looks to hold little cheer for retailers after a tough 2019 to date, and according to Deloitte’s recent Retailers’ Christmas Survey, only 21% (down from 41% last year) of respondents expect a growth above 5% this year."
Retail prices are surging on supply factors
Rumbens said retail price growth has been accelerating over the past year, with prices growing 2.6% in the year to September quarter.
"This is the first time since 2009 that retail prices have consistently outpaced general price pressures in the economy," he said
"Unfortunately for retailers, price growth is not reflective of stronger demand, but rather increasing cost pressures from a weaker Australian dollar, the increase to the minimum wage, and supply disruptions from droughts and floods.
"With retailers being squeezed on both sides from weak sales volumes and increasing costs, margins are coming under pressure."
Looking to 2020 for a turnaround
"We expect to see a much-needed improvement in the drivers of spending, providing the environment for a turn around the weak retail demand profile in 2020," Rumbens said. 
"Stronger wage growth, a reinvigorated housing market and moderating prices pressures are expected to support a much stronger growth outlook in the year ahead."
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