[+] Cairns Runs Hot as State Drives Development Upsurge

To catch the trick when a magician is at work you have to avoid falling for the misdirection. In much the same manner, while many in the property industry remain focused on the three capital cities of the eastern seaboard, others have made inroads by looking elsewhere. Cairns in Far North Queensland is just such a place. Governments drive development Towards the end of the previous decade, the federal and state governments earmarked Cairns for major development, particularly its port, to boost industrial and tourism capabilities. Among the projects created was the Cairns Marine Precinct, with two new wharves and connections to services, off the back of funding that included $30 million from the state. The precinct expanded in-water maintenance options for Australian Border Force and Australian Defence Force vessels. A common user facility was then proposed as part of the precinct to bring maintenance, repair and overhaul service providers together. The Queensland and Federal Governments have each kicked in $180 million for the project, which will include a 5000-tonne shiplift, three hardstand areas, wet berths and two facilities to blast and paint vessels. ▲ The Queensland Government’s plan for the Cairns Marine Precinct from its business case in 2021. In May 2023, the Queensland Government announced more funding—$39 million—for other projects in the precinct, which includes $27 million for upgrading roads and bridges to the common user facility and $12 million for upgrading existing facilities. But it wasn’t just the precinct that was key—it took an existing demand for services and housing, and accelerated it. “Like all major centres across Australia, Cairns is experiencing strong population growth off the back of international migration and a desire to live in lifestyle locations,” Cairns Regional Council planning director Ed Johnson says. This has prompted interest from a raft of Queensland developers, including Kroymans Developments, which is developing residential projects around Mt Peter, about 16km south of the Cairns CBD. Meanwhile, by 2022, Nigel Satterley of Perth-based Satterley Property Group had become one of the big hitters in the city with his Smithfield Village project, 20km north of the CBD. ▲ An aerial view of Smithfield Village. This week news broked that the Smithfield Shopping Centre had changed hands for $138 million —another vote of confidence in the region. Lendlease is also part of the mix, developing the Cairns Central shopping centre through its Australian Prime Property Fund Retail (APPF Retail) before selling it to Fawkner Property for $390 million in December, 2023. The company has been active elsewhere in Cairns in part thanks to its commission to deliver the Cairns Convention Centre, another state government project. But it was not just Australians getting involved. Canadian company Brookfield has also thrown its hat in the ring, quietly working on the 155ha masterplanned Bluewater Estate at Trinity Beach, about 21km north of the city proper. More to come Opportunities remain in the city that is one of the major gateways to the Great Barrier Reef, especially in residential housing. According to CoreLogic data, housing prices in Cairns have steadily increased with the units in 2023 on average 10.34 per cent more than the previous year. House prices increased by 5.45 per cent during the same period. “Cairns is one of the fastest-growing regions in Queensland with the city’s population expected to grow to more than 241,000 by the year 2050, according to revised figures released by the State Government in June,” Johnson says. “That is an increase of about 70,000 people, which will create the need for over 32,000 new homes during the next three decades.” Development within the CBD area is also much needed as the growing population brings with it a higher demand for key services. While Lendlease nabbed projects such as Cairns Central and the Convention Centre, other opportunities still exist. Lendlease has also confirmed that it has no other projects in Cairns. ▲ Cairns Central, developed by Lendlease, has changed hands for $138 million. “Cairns is experiencing strong interest and demand within the CBD for residential development, high-value retail and entertainment activities aligned to our CBD masterplan and a desire to create activity and entertainment precincts,” Johnson says. The focus on servicing and expanding the marine and defence sector as well as manufacturing and aviation means that there will be demand for commercial and industrial spaces, with an entire business precinct next to the marine precinct. “Cairns CBD is experiencing a transition like many central business districts across the nation as retail preferences and economic structures have shifted post-Covid,” Johnson says. Healthcare and allied services for Cairns’ growing population is supported by the Cairns Health Innovation Precinct. It holds the Cairns University Hospital and the Cairns Health and Innovation Centre. The Cairns South State Development Area is managed by the state department with most of the land still owned by individual landowners. It has a planning scheme that allows for freight rail applications, other major transport infrastructure including intermodal transportation , industrial use, particularly that which supports the sugarcane industry; and linear infrastructure such as the delivery of services. ▲ Intermodal transport and freight rail are among possible uses for land in the Cairns South State Development Area. Tourism is of course a key sector—the development of the marine precinct is expected to allow superyachts to dock in the Cairns Port for longer and more often, boosting tourism numbers. “The city also hosts up to 3 million tourists each year,” Johnson says. Developer Darrin Halpin, of PPNQ Developments, recently filed plans for a $140-million tourist park at Kewarra Beach, looking to capitalise on the predicted tourism increase. Council dangles carrot The Cairns Regional Council announced in December that it would forgo infrastructure charges for a 490-house project at the former Cairns Coral Drive-In site at Woree. It is Queensland’s largest social housing project at 5.36ha—the council announcement means it will waive $8.6 million in infrastructure charges. “While provision of housing is a state and federal government responsibility, as a council we can play a role by helping to facilitate appropriate development approvals in an expedient manner,” Cairns Mayor Terry James said. “It helps tackle the housing crisis and there is little cost to the council in terms of trunk infrastructure investment, as it is already in place.” The waiver occurred under the council’s Development and Investment Incentive Support Policy, which allows for full or partial waivers of infrastructure charges and stimulus payments. Among other criteria, developments have to be approved with substantial work on site, and be outside the Cairns South State Development Area. ▲ A render of the project slated for the former Cairns Coral Drive In. Community housing, education and medical centres, industrial use, such as aviation, marine and defence and manufacturing; student and short-term accommodation, and long term residential use are all eligible. But infrastructure is also causing problems. “Water security is the the council’s number one priority—we are facing unprecedented growth and without a secure water supply we won’t be able to provide the homes, roads, hospitals, schools and other infrastructure needed for our community to grow and prosper,” Johnson says. The Cairns Water Security Stage 1 will begin construction this year with completion expected in mid-2026. It will be a key part of the stagecraft necessary to pull off the Cairns magic trick. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] Cairns Runs Hot as State Drives Development Upsurge

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[+] Cairns Runs Hot as State Drives Development Upsurge

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