[+] Southern Gold Coast Bolstered by ‘The Calile Effect’

When you think of Queensland’s Gold Coast, the dizzying heights and sparkling lights of Surfers Paradise and Broadbeach come to mind. Down on the southern end, from Bilinga to Rainbow Bay, growth has historically happened at a more leisurely pace—until recently. According to GV Property Group principal Antonio Mercuri there are now 17 developments either recently approved, under way or recently completed in the 5km stretch of the Southern Gold Coast. That means more than 700 apartments worth a combined $1 billion, in addition to the hotel projects such as KTQ’s triple tower Kirra Beach Hotel, approved last year . “The southern end is no longer prone to a lack of demand—it was a sleeping giant but it’s now well and truly awake,” Mercuri says. “A decade or so ago, we would’ve seen a wave of lodgements with a few of them being built before it all went quiet again. It was quite questionable but today there is a deep buyer pool for that location.” The Gold Coast, but laid back The Gold Coast is probably best known for its party culture but down on the southern end it’s a different story, says director of Marquee Development Partners Jacques Winterburn. “The Southern Gold Coast is attracting buyers looking for a more relaxed lifestyle with fewer amenity offerings compared to Central Gold Coast areas,” Winterburn says. “Developments in the Southern Gold Coast that are within walking distance of the beach and offer water views are particularly appealing to owner-occupiers and downsizers due to their smaller scale.” ▲ Marquee ’ s Sol development on the Kirra headland is sold out and under construction, Director of Joe Adsett Architects, the developer behind Rockpool Rainbow Bay as well as Sunshine Coast projects , Joe Adsett agrees, adding that renowned surf breaks have attracted professionals and amateurs from across the world. “It’s not uncommon for Southern GC locals to describe themselves as not part of the Gold Coast and more aligned culturally and geographically with northern NSW,” he says. But as the example of Byron Bay has shown, relaxed doesn’t necessarily mean affordable. Of the circa 700 apartments about to be built or completed in the area, an estimated 70 per cent, or 500 units, have already been sold, showing an “insatiable appetite” for luxury living in that part of the Gold Coast, says Antonio Mercuri. Value proposition This value piece is also making the area attractive to both developers and buyers, says founder and managing director of Siera Property Group Brent Thompson. “For the time being, the Southern Gold Coast provides value for money when compared to similar protected, north-facing beachside locations like Noosa or Byron Bay,” Thompson says. “Our purchasers are all seeking to secure the lifestyle on offer on the Southern Gold Coast while they can as development activity decreases and supply dwindles.” Director of S&amp;S Projects—which has just received approval for its latest $200-million Rainbow Bay project, Radia—Paul Gedoun says that the market is aimed towards downsizers, and thus higher-end projects make sense, as well as stacking up financially. “We have found the interest is in larger, liveable apartments, well appointed and designed for owner-occupiers,” Gedoun says. “[But] there are many existing apartment buildings sitting in prime locations that are underutilised.” ▲ S&amp;S Projects' $90-million Flow Residences achieved an average of $3.5 million an apartment. It also helps that the $380-million Kirra Beach Hotel project is set to have the same effect on development and property values as The Calile Hotel in Brisbane, says Joe Adsett. “Have a look at what happened to property prices in the peninsula of Teneriffe, New Farm and Newstead after the Calile Hotel was built,” he says. “If numerous quality hotels are redeveloped then I think the southern end will ultimately win the race for the tourism dollar because the northern end is an hour’s taxi drive away from the airport.” But that’s not to say the Southern Gold Coast is without its challenges. Constraints and opportunities The key to unlocking Gold Coast sites is amalgamation, says Mercuri. “Putting blocks together and selling the site, that ’ s the key in that southern pocket,” he says. “Rarely does it belong to one owner, and you have to work with those unit owners to unlock that land, and that ’ s the main issue from an availability point of view,” he says. This is a challenge most developers in the area will understand well, says Marquee’s Winterburn. “On the Southern Gold Coast, older lowrise buildings also often have higher value based on their existing apartment values rather than redevelopment potential, given the height restrictions.” ▲ S&amp;S ’ s recently approved Radia projects is a 14-storey tower of 48 high-end apartments. S&amp;S director Paul Gedoun says that although local planning allows for more dense development, building new on old sites has proven to be a challenge. “It is even harder in the southern end of the Gold Coast as the owners are reluctant to sell and some developers have secured a single apartment in a lot of the buildings to secure these spots and block others from attempting. I know this is the case in Rainbow Bay.” Height restrictions are also more stringent at the southern end, and often dictate a maximum of nine levels with not many above 12 storeys. “Reduced height limits have seen local developers create boutique residential buildings targeting mainly owner-occupiers and sometimes smaller apartments aimed at those seeking secondary holiday homes,” says Joe Adsett. It hasn’t helped that, as Brent Thompson says, there has always been less development activity in the area. “[This is] due to the limited availability of land and the reduced availability of development sites due to planning constraints, fragmentation of ownership and well-established long-term owners who are reluctant to sell means that development has and continues to be constrained across the Southern Gold Coast,” he says. ▲ Pipis by Siera is a 19-apartment development on Golden Four Drive in Bilinga, due to complete in 2025. “These constraints have meant that only well-established and experienced developers have been able to bring developments to life.” Out-of-state developers have found the Gold Coast generally a tricky nut to crack. “There was an influx of interstate guys but that delivery piece is a problem, so it’s usually local guys from Brisbane and the Gold Coast and even from Sunshine Coast because they understand that buyer pool and that mindset,” Mercuri says. But despite these challenges, the demand for lifestyle and its value proposition puts the Southern Gold Coast in a good position for future growth. “It used to be a holiday destination, people went for the weekend or a Sunday drive, but once people started to spend more time there and now quality residential developments are being offered, they’re seeing it as a place to live,” he says. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

[+] Southern Gold Coast Bolstered by ‘The Calile Effect’

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[+] Southern Gold Coast Bolstered by ‘The Calile Effect’

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