09/10/2024

Brisbane’s Rapidly Changing CBD

Posted by: Hugh Menck

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The Economy

Brisbane’s momentum is building, and the majority of the city’s industries and services are growing. Brisbane is the fastest growing major Australian capital city over the past 10 years with a further 34% growth expected over the lead up to the 2032 Olympic Games. Stable governance and ease of doing business turn growth opportunities into reality, exemplified by Brisbane’s Average time to development application approval – faster than that of Sydney and Melbourne by 38%. 

Brisbane’s competitive operating environment coupled with leading education and research centres and the highest rates of technical trades attainment in the country, combines to give Brisbane the competitive edge over other state capitals. With a $25 billion infrastructure pipeline, Brisbane is fueled for growth giving investors’ confidence moving forward. 

 

Queen’s Wharf Brisbane 

Currently partially opened, Queen’s Wharf is one of the largest urban renewal projects in Australia and the largest ever in the Brisbane CBD. With the recent completion of the Casino, Skydeck and Hotel, residents have flocked in numbers to enjoy the new state of the art amenities. The final product will be an iconic nation shaping development. 

The end result is expected to deliver 12 hectares of riverfront land, 4 new luxury hotels & numerous retail offerings, and additional 1.39 million annually and over $4 billion boost to Queensland’s Gross State Product. 

 

Cross River Rail 

Cross River Rail is a new 10km rail line from Dutton Park to Bowen Hills, which will incorporate six new station routes via the Brisbane CBD: with four new underground stations at Boggo Road, Woolloongabba, Albert Street and Roma Street. 

Albert street station is the first new CBD train station in more than 120 years. With an estimated 67,260 users daily, the station will help connect the midtown precinct to greater Brisbane, allowing for easy access to the Queens Wharf, Waterfront Brisbane and Queen Street Mall. 

 

Brisbane Metro 

The Brisbane Metro will provide high capacity and high frequency Metro services along a 21-kilometre service from Eight Mile Plains to Roma Street, and Royal Brisbane and Women’s Hospital to University of Queensland connecting the CBD to the Brisbane suburbs. The $1.2 billion development will feature 18 stops over a 21km service with a potential expansion in time for the 2032 Olympics. These expansions will aim to connect proposed Olympic venues in order to target 90% public transport travel during the games with extensions to the airport, Capalaba, Springwood and Carseldine. 

 

Treasury Building

Griffith University recently purchased the remaining leasehold for the former Treasury Casino for $67.5 million which expires in 2070. Griffith will transform the Heritage Building into a new campus dedicated to Business, IT and Law faculties as well as postgraduate education. The campus will accommodate 7,000 students by 2035 attracting both local and international students providing a space for collaboration, innovation and community involvement. Its central location adjacent to the Queen Street Mall in tandem with the Queens Wharf Development will revitalise western end of the CBD increasing investor confidence as the area becomes a place to live, learn and play in the lead of the lead up to the 2032 Olympics. 

 

Howard Smith Wharves new proposed DA 

Artemus Groups, led by Adam Flaskas, have proposed an overhaul of Howard Smith Wharves with a visionary development to replace Felons Barrel Hall and revitalise the eastern edge of the wharves. The proposed 77-room hotel will take over the existing Felons Barrel Hall but will still accommodate a retail precinct and a music hall on the ground floor. A revitalization of Bougainvillea House will feature a second story and the Rivershed renovations will feature a pool deck with an overwater pool, bar and dining precinct offering patrons epic river views. Two new lifts and expanded riverfront public spaces will provide greater access and thoroughfare throughout Howard Smith Wharves. Although the Howard Smith Wharves is already one of the business retail precincts in Brisbane, this further investment shows an increased level of confidence in the market and a steady forecast for consumer spending despite the increased cost of living and higher construction costs. 

 

Waterfront Brisbane 

Dexus’s $2.5 billion redevelopment project for Eagle Street Pier is set to transform the area into a world class business and leisure destination. Project delivery includes and integrated, 9,000m2 of open space, 2 mixed use office towers and a podium totalling 145,190m2 gross floor area (Tower 1: 75,331m2, Tower 2: 59,999m2, Podium: 9,860m2). With the first tower due for completion in 2028 and already 49% pre committed by world class tenants, investors and developers remain confident that significant capital deployment in Brisbane will result in immediate returns due to the high demand for premium office and retail space. 

 

Office Sector 

The Brisbane CBD office market is the best performing out of the three biggest east coast markets. With a vacancy of 9.5%, and 12-month prime grade rental growth to July 2024 of 8.1% the Brisbane CBD drastically outperformed its southern counterparts. With limited supply in the pipeline, investors can be assured that vacancy will continue to tighten and rents will continue to grow providing increased valuations and stronger sentiment in the market. 

 

There are 6 major CBD office towers approved with only 3 under construction and expected to be completed before 2029. Although there is 162,371m2 of lettable area under construction and subsequent backfill opportunities present once completed, there is a much higher demand for prime office space in Brisbane compared to secondary assets. This sentiment boosts both investors and developers’ confidence to build / refurbish new state of the art offices that meet the market needs. 

 

For further information contact:

Hugh Menck MRICS

Head of Capital Transactions

hmenck@bne.mcgees.com.au

+61432560589

 

Jason Lynch 

Capital Transactions 

jlynch@bne.mcgees.com.au

+61404092422

 

Archer Halliday

Analyst | Capital Transactions

ahalliday@bne.mcgees.com.au

+61497599959

 

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