The Sunshine Coast’s booming health sector and population growth are driving unprecedented demand for property by medical and allied health practices.
Anchored by the $1.8 billion Sunshine Coast University Hospital and already home to around 2,000 healthcare-related businesses, the region is fast becoming known as the place to be for medical, health and wellbeing innovators.
A vision for the coast to become a global leader in the sector has resulted in significant investment in healthcare infrastructure by local and state governments. One of the largest health infrastructure projects underway in Australia, the $5 billion Sunshine Coast Health Precinct is a magnet for world-class health and research businesses and driving growth for established companies.
IDEAL CONDITIONS FOR VENDORS
Interest in leasing and purchasing from healthcare businesses is experiencing record demand. Ray White Commercial Noosa and Sunshine Coast Commercial Property Consultant Tallon Pamenter says properties that hit the market disappear almost instantly, offering ideal conditions for vendors looking to sell or lease.
“Many interstate owner-occupiers are buying properties to set up shop here, particularly doctors, dentists and specialists. In terms of allied health, we are seeing interest from psychologists, physiotherapists, massage therapists and other complementary modalities wishing to secure leases,” says Tallon.
“On the back of demand, and population growth on the Sunshine Coast, many existing local medical and allied health businesses are also expanding by taking on leases for larger premises or growing their footprints across multiple suburbs,” Tallon said.
Research by Ray White Commercial indicates that over $260 million in medical asset sales have been recorded across Queensland this year, many of which represent small owner/occupier medical suites.
The private investor market, notably in the sub $3 million price range, has actively pursued medical centres and medical suites, given the attractive yields between 5% and 6% and relative security of the asset class. The quality tenant profile and requirements for tenants to maintain properties to a high hygiene standard due to the pandemic add to the appeal.
SUNSHINE COAST HEALTH SECTOR SNAPSHOT
DEMAND GROWTH AND AN EDUCATED WORKFORCE
The region is an ideal long-term prospect for both established and new healthcare businesses. Population growth for the Sunshine Coast has averaged 2.7% over the last decade, and that’s without the COVID-factor. The sector will service a catchment of 2.4 million people by 2041.
Healthcare businesses in the region can capitalise on USC’s medical and health science courses and close relationships with healthcare providers. A wide variety of programs, including nursing, health promotion and biomedical science and medicine (in partnership with Griffith University), produce a steady stream of educated workers with hands-on sector experience.1
RECENT PROPERTY MOVEMENT
Tracey Ryan from Ray White Commercial Noosa & Sunshine Coast North recently sold three hinterland medical centres at Cooroy, Imbil and Pomona with a combined total value of $4.28 million and yields ranging from 5.4% to 7% (Imbil). The properties were highly sought after and sold in short time frames.
“A high level of national enquiry was generated on the properties, however, all three properties were ultimately purchased by local buyers recognizing the growing demand for medical services on the Sunshine Coast,” Tracey said.
The Ray White Commercial Noosa & Sunshine Coast North team achieved exceptional results for a 112m2 medical suite at 23 Elsa Wilson Drive, Buderim last week. Tallon Pamenter sold the suite for $1.075 million, the highest recorded price per square metre within this medical facility. An eye specialist moving into the region purchased the property after a local Obstetrician-gynecologist owner-occupier decided to retire. Tallon reports the owner is very happy with the sale, and even more excited to spend time on his passion for music.
There are currently 15 health facilities in the development pipeline across the Sunshine Coast and Noosa Local Government Areas. The bulk of these developments are for new medical centres and specialist health care suites, along with refurbishment of some existing facilities.
David Brinkley from Ray White Commercial Noosa & Sunshine Coast North is seeing growing demand for medical and allied health space in the Noosaville area, with local and national businesses seeking larger format properties ranging from 250m2 to 600m2 to lease or purchase.
The Eden Rehabilitation Hospital in Cooroy is undergoing an expansion project with 21 new beds and new facilities. A medical centre and vet clinic are included in the Eenie Creek Road commercial and community development, due for completion by the end of 2023.
Across the road from Sunshine Coast University Hospital, the recently opened Vitality Village integrates services, research, education and innovation in community health and wellbeing. Intended as a collaborative space where businesses address some of the critical healthcare challenges of our generation, the village is already more than 70% leased.
A HUB FOR HEALTHY LIVING
Tallon Pamenter says that the influx of younger people to the coast due to COVID-19 will add to the already strong demand for healthcare services. Alongside a growing ageing population, there’s increasing migration from people in their twenties to forties from southern states who are bringing their businesses and families.
“The Sunshine Coast is a hub for healthy living,” Tallon says. “We live an active and outdoorsy lifestyle, almost like a mini Santa Monica in LA, which is attractive to that age group. Anecdotally, we’re hearing of large numbers of people currently living interstate who are just waiting for the Queensland border to fully reopen before making their move.”
“People who originally thought they would have to stay in a capital city to operate a successful business can move here, run a practice, make great money and have a fantastic lifestyle. Their kids get to grow up by the beach, what more could you want?” he said.
Properties near central medical facilities – Birtinya, Buderim, Nambour, Maroochydore CBD, Cotton Tree, Kawana, Mooloolaba and Noosaville – are most sought after, particularly those in close proximity to housing and with excellent exposure (such as along Nicklin Way).
MORE STOCK NEEDED – BUYERS READY
The bottom line? More stock is urgently needed to support the region’s robust medical and allied health sector, making now the perfect time for property owners to sell and capitalise.
Ray White Commercial Noosa & Sunshine Coast North has an array of local and interstate buyers ready to go – investors looking for quality tenanted medical investment properties, and owner-occupiers looking for space to grow their businesses. If you’re thinking about selling, there’s high demand and little stock, so the timing is perfect.
1 Invest Sunshine Coast, Australia’s Sunshine Coast: Health and wellbeing industry – the ideal location for innovative health investment.
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