The Sunshine Coast commercial market continues to exceed all expectations. Resilient, robust and forward-looking, the region is on target to meet projected economic and population growth rates despite the upheaval of the past two years.
Infrastructure investments are keeping pace with population growth. Interest in commercial property across all asset classes continues to be high. And sustained demand from cash-rich interstate buyers means premium returns.
Even though the market is a little unpredictable and many are watching with interest to see what will happen next, there’s still plenty to be optimistic about.
People continue to flock to Queensland at the fastest rate in 20 years, which shows no signs of slowing. Net migration for the year ending June 2021 was 30,939 people, or 90% of the national interstate migration.
“People are still selling houses for $6 million in Sydney or Melbourne and moving here, buying a nice house for $2 million leaving $4 million in the bank. They’re cashed up and ready to build their portfolios and invest in commercial property here,” says Ray White Noosa & Sunshine Coast North principal Paul Forrest.
“Reciprocity of the Sydney and Melbourne market with Sunshine Coast commercial and residential markets drives investment. While Sydney and Melbourne markets continue to do well, the Sunshine Coast will too. As people move here, they bring their businesses, look for an investment or bring skills and knowledge to existing local employers. It’s a win-win situation.”
For the most part, the Sunshine Coast retail sector has recovered to pre-pandemic levels, consistent with results across Queensland.
The state saw a 17.5% increase in consumer confidence in the 12 months to November 2021. Spending in Queensland was up by 27% in early February, compared to pre-COVID figures (not taking into account the impact of recent flooding on spending).
Paul Forrest says it only takes a trip to Melbourne to reinforce how well the retail sector on the coast is doing, comparatively speaking.
“I spent a week in Melbourne in late February and it was quite sad to see the number of vacant shops. So many businesses and retail stores were closed down. There were signs of recovery but it’s a very different world to what we have on the Sunshine Coast,” Paul said.
“Ultimately, retail has ridden the wave of COVID relatively well here despite recent supply chain and staffing issues. Retail presence is strong from Hastings Street, Tewantin, Noosa Junction and Peregian down to Maroochydore. There are few vacant shops and those that hit the market are snapped up quickly.”
While inevitable interest rate rises, higher prices and an upcoming federal election are cause for pause, the local retail market’s resilience to date places it in a firm position to deal with future uncertainty.
The Sunshine Coast region already boasts an $18.5 billion economy, expected to reach $33 billion by 2033.
Investment in the Sunshine Coast International Broadband Network, the expansion of the Sunshine Coast Airport, a new Maroochydore CBD and the Sunshine Coast University Hospital are positioning the region for the future, driving investment and growth.
Local and state governments and industry associations are generating abundant opportunities for businesses seeking to establish, expand or relocate, supported by incentives and relocation assistance.
The region is being proactively marketed as anunbeatable location to live, work and do business, attracting the interest of national and global players.
It may be ten years away but the Sunshine Coast’s role in co-hosting the 2032 Olympic and Paralympic Games will attract substantial investment to the area.
The region will be home toseveral major events, including football, basketball, marathon, mountain biking and cycling. Part of the new Maroochydore City Centre will become the athlete’s village.
Visit Sunshine Coast CEOMatt Stoeckel said the Olympics would turbocharge the Sunshine Coast’s economic development.
“With the new international-capacity runway at Sunshine Coast Airport, there are excellent prospects for attracting additional hotel and tourism development for domestic and international travellers … The fact that we will play an integral role in a world event of the magnitude of the Olympic Games should provide optimism for the future,” said Mr Stoeckel.
Ray White Commercial Noosa & Sunshine Coast North principal Paul Butler agrees there’s a general sense of confidence in southeast Queensland around the Olympics.
“The event will require additional infrastructure, attract new residents and employ a significant number of people. While the business community is still squarely focused on meeting current demand, they will inevitably factor in the Olympics as they turn to future planning.”
The Sunshine Coast is renowned for its vibrant, proactive and welcoming business community.
Well supported Chambers of Commerce, a respected Business Women’s network, theHastings Street Association, tourism bodies,Silicon Coast network for entrepreneurs and Australia’s fastest-growing food and agribusiness cluster, theFood and Agribusiness Network (FAN), provide a sense of momentum and belonging.
“The Hastings Street Association and the Noosa Chamber are fairly focused at the moment, providing a strong and representative voice from the business community to council and other authorities,” says Paul Butler.
“A range of informal and formal networks, meet-ups, associations and groups bring people together and fast-track access to information and resources. New businesses to the region should get in touch because they can make introductions and build connections.”
The strength of local business networks promotes partnerships and collaboration, resulting in creative thinking and innovative survival strategies during times of uncertainty.
The Sunshine Coast is going through an evolution of sorts. Once reliant on tourism and construction, the region is experiencing astonishing growth in the professional services and healthcare sectors, generating innovative investment and employment opportunities.
The explosion of the professional services sector is evidenced by the high net absorption of office space and continued demand for A-grade office assets.
Major players like Huddle Insurance, Youi, OfficeHQ and Stella Asia Pacific have all set up shop on the Sunshine Coast, supported by an educated workforce, lower business costs, and comparatively lower commercial sale and leasing costs.
As the region grows, so do opportunities to service an ageing population and younger families now calling the area home. The17-hectare Health Hub, incorporating Sunshine Coast University Hospital, healthcare innovatorVitality Villageand the plannedNoosa Health Precinct complete with a multi-theatre private hospital, position the region as a place for leading-edge healthcare businesses.
Commercial property in medical precincts is especially sought after by end-users.
Buyers continue to get in on the auction action across all local commercial asset classes.
There would be few buyers not considering the current economic uncertainty but many are still eager to take advantage of stock on the market as long as the price is right.
“We’re not getting the same frenetic energy as last year but the prices we are achieving are still great and our sellers are ecstatic,” says Paul Forrest.
Many investors from southern states are well versed in auction culture and expect to purchase through auctions.
Our trifecta of excellent auction results for March demonstrates a continued willingness to buy commercial property through this method.
“While interest continues to run high, particularly in the industrial, office and retail markets, going to auction is still a great way to test the market and generate a sense of competition, particularly for high quality properties” says Paul.
Check out our latest Auction results.
SO WHAT DOES THIS MEAN FOR COMMERCIAL SELLERS AND BUYERS?
The future of the Sunshine Coast looks highly resilient due to its robust economy, investments already underway, reputation for innovation and status as a lifestyle location.
If you’re looking to sell, it is a good time with premium prices still achievable (check out ourrecent sales), while stock is still in high demand across all asset classes.
The team at Ray White Commercial Noosa & Sunshine Coast North is embedded into the business community, know the local commercial market and are always looking out for the next opportunity for our valued clients. If you’re ready to sell, we’re here to help. Get in touch for a free market appraisal.
Contact our office on +617 5474 7600 or firstname.lastname@example.org
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