Oh to have a crystal ball! The ability to look as far into the future as you possibly can when you’re looking at investing into a market. Brett Warren has done that for us and tells us what he thinks Brisbane will look like in ten years from now.
Kevin: It’s always good to look as far into the future as you possibly can, especially if you’re looking at investing into a market. The question I’ve asked Brett Warren from Metropole Properties in Brisbane is what does he think Brisbane will look like in ten years from now. He’s written a very interesting article, which is up on our website right now at Real Estate Talk. Just go in and search; it’s under my featured channel. He joins me to talk about this.
Good day, Brett. Thanks for your time.
Brett: Hey, Kevin. Good to be with you.
Kevin: And thank you in particular for doing this. I know you spend a lot of time having a look at what you think the Brisbane market is going to be like. Give me a bit of a snapshot.
Brett: Absolutely. Kevin, when we last spoke, if you remember, we’ve had a pretty ordinary decade in terms of growth and in particular, capital growth. I’ve just read an article by Bernard Salt, and he’s of the same opinion that Brisbane is probably going to play a bit of catchup over the next ten years and try and catch up to those major metropolises like Sydney and Melbourne.
Kevin: What’s involved in that? Is it a lot more infrastructure, or is there enough infrastructure in the pipeline now for us to be able to achieve that kind of growth?
Brett: There are some infrastructure things happening and projects happening. The more exciting thing from my point of view – and obviously from a property investment perspective – probably our three major employment hubs are really starting to expand.
You probably will have heard and seen that the Queen’s Wharf project is really going to be a centerpiece for the CBD expansion in Brisbane and create jobs and pump about $1.7 billion worth of tourism into the coffers, which is much needed, as you know.
You may have seen Brisbane Airport looks like a bit of a sandpit at the moment, but we’re actually getting a second runway out there, as well. So, that’s going to increase flights by about 130,000 each year and will rival Singapore eventually, which is a major international city.
And finally, some of our hospitals are starting to transition, as well. We’ve already had Lady Cilento up and running and things like that, but there’s another $1.1 billion expansion of Royal Brisbane Hospital as well to create more jobs and age care facilities and things like that.
Kevin: Entertainment is going to play a big part, too. The lifestyle or the climate in Queensland – and in Brisbane in particular – leads to that with the river, as well, doesn’t it, Brett?
Brett: Yes, absolutely. We have some entertainment precincts. That’s going to increase the walkability and the lifestyle. People want those lifestyle projects. So, the old, rundown Howard Smith Wharves is going to get a facelift, and they’re spending about $100 million transforming that to link the city to the New Farm Riverwalk.
As you know, the Brisbane Showgrounds are expanding at the moment. They’re midway through that, with about $3 billion being spent to redevelop that with new retail space, laneway shops, and really going to maintain that green space, which is important.
Probably the last thing from my perspective: Brisbane’s response to Madison Square Garden in New York City is Brisbane Live, which is a 17,000-seat amphitheater and rock concerts and multiplex cinemas and restaurants and bars. That’s all planned to be above the Roma Street train line, so that’s going to be very accessible to everyone in Brisbane by the public transport network.
Kevin: All of this development that’s happening, Brett, what do you think is going to happen with capital growth over the next decade?
Brett: I can tell you it’s going to be a lot more exciting than the last decade, Kevin; that’s for sure. I think I mentioned before, we have a number of things that we monitor in terms of immigration, jobs, wage growth. That’s all been trending downwards until recently, when we’re starting to just see a bit of a neutralization and even an upswing.
These types of projects are going to create massive amounts of jobs, high demand in the inner city, and things like that. And as I said before, the tourism spend is going to come up a lot as well, and that’s what Brisbane has been sorely lacking in the past decade.
Kevin: What areas would you be looking at in South East Queensland, or would you be looking specifically at inner Brisbane?
Brett: Inner Brisbane, I’d probably be looking within about a 10- or 12-kilometer ring. You still need to look for the good demographics, the rising incomes, the access to employment hubs. We’re planning to get about another million people to Brisbane by 2031, so as you can imagine, Kevin, public transport is going to become more and more important, so train lines and busways and things like that.
We’re also seeing little trends like good school catchments, and walkability is becoming a bit of a buzzword, but some of those lifestyle precincts that we’re developing as well are going to be a huge benefit and create a lot of demand in that inner city area.
Kevin: Are you concerned about an oversupply of apartments in that inner city 10-kilometer ring?
Brett: Yes, absolutely. There is a small oversupply at the moment, but you’ll find that most of those areas are areas where the land has been re-zoned. It was old factories and warehouses, and all of a sudden, they could put 200 or 300 apartments on. But as I said, with a million more people to Brisbane, that’s really a short-term concern. That’ll get taken up, and then the land is really going to be a premium. So, that’s where the drivers will come from.
Kevin: Brett, that’s a great insight there as to what’s going to happen in the next decade in Brisbane. Things are looking pretty rosy. So, you’ll be recommending people continue to invest in Brisbane, South East Queensland?
Brett: Yes, absolutely, particularly for the next decade. I’ve spoken to a lot of people. Once that Queen’s Wharf project and that expansion starts to happen, the second runway gets built, that’s when you’ll really start to see the lights switch back on again in Brisbane, and I think capital growth will follow.
Kevin: What about some of the regional areas around Queensland? Will some of them continue to struggle?
Brett: I think they will. A lot of it has to do with employment. We always hear that Redcliffe is getting a train line or there’s a hospital coming into the Sunshine Coast and things like that. They’re isolated incidents, unfortunately. We really need… And most people are moving to where the jobs are, and unfortunately, that’s the inner city and capital cities in Australia.
Kevin: Yes. Good talking to you. Brett Warren, of course, from Metropole Properties in Brisbane. A great insight there as to what’s going to be happening in the Brisbane market in the next decade.
Brett, thank you very much for your time.
Brett: Thanks, Kevin. Good to be with you.