PODCAST
QLD MARKET OVERVIEW
QUEENSLAND
Ryan Langham - Commercial Retail & Industrial Sales Specialist | RWC Burleigh Group
The safe way to mitigate these issues is ensuring that their costs are accurately calculated for the projects. Time to develop and acquire the cost of land has increased which makes or breaks any project running to lean on the margins affects their ability to take on multiple projects at the same time and minimising the risks along the way. What we are seeing is more the availability of land and red tape of the approval’s process which blows out project start time along with limited infrastructure funding in certain region. As you know, the rise of build-to-rent (BTR) as an asset class has grown exponentially in Australia over recent years - how have you observed this trend & is there an opportunity for developers to pursue BTR projects from a residential land perspective? Traditionally these have been around for along time under the Land Lease Community business model, however the BTR model is becoming more and more popular in the apartment sector as we move forward to a new market and conditions where cash flow provides greater LVR leverage and with an ever tightening residential vacancy rate these models are being favored by lenders due to the low risk. Similarly, land-lease communities are another asset class through which significant capital has been deployed recently, particularly from large-scale residential development groups - how have you observed this evolution and do you anticipate further growth in these sorts of deal? As with any sector capital allocation and deployments is traditionally aimed at high growth areas and as this sector gains popularity to mainstream investors rather than just the
Thanks for the opportunity to share your insights - to begin, give us a sense as to how you’re finding transaction activity for residential development land sites as we approach the mid-point of 2024? Activity and opportunities are not aligning across QLD and NSW there is plenty of interest across these states however the market has moved exceptionally quick in the last 2 years that getting sites approved has become the biggest conversation piece as to how much longer the approval process is taking which ultimately affects the availability for the consumer. More sites are on offer and we are likely to see an increase in the new FY. Clearly there’s an acute housing shortage across Australia - based on your conversations with developer clients, what’s their appetite for pursuing new opportunities & what are the underlying fundamentals they’re considering in their analysis? Appetite has never been stronger. We see this across both the residential and commercial land development sectors to assist and aid in easing the housing crisis. New opportunities are getting strong interest from all across the state as developers are looking to provide emerging communities with the much needed end product. The fundamentals at play are still acquisition and construction costs as these have not eased and will impact their business and ability to grow and acquire new opportunities. There’s a number of challenges and pressures facing developers, not least the cost of construction, cost of capital & availability of land - what’s your gauge as to how developers are mitigating some of these issues?
RYAN LANGHAM
86 – June / July 2024
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