Article in Courier Mail. Friday July 22, 2011

Bryant, Lyndall

English

Queensland University of Technology ePrints Archive

This is the author’s version of a work that was submitted/accepted for pub-lication in the following source:Bryant, Lyndall (2011) Land buyers likely to foot reform costs. Courier Mail,July (22), p. 80.This file was downloaded from: http://eprints.qut.edu.au/47948/c© c© 2011 News QueenslandNotice: Changes introduced as a result of publishing processes such ascopy-editing and formatting may not be reflected in this document. For adefinitive version of this work, please refer to the published source:80 The Courier-Mail Friday, July 22, 2011 couriermail.com.au FRSTThis 948sqm site sits in the heart of the ‘Chermside Centre Neighbourhood Plan’, making it a prime position for developers.  With zoning suitable for multi  levels (subject to council  approvals), this is an opportunity not to be missed.Within walking distance of Chermside Westfield Shopping Centre, Prince Charles and Holy Spirit Hospitals, transport, library, clubs and restaurants, it is a rare occasion that blocks like this come on the market.For sale by closed tender.Tender documents available from our office and close on Wednesday 10th August 2011 at 3.00pm.CALLING ALL DEVELOPERS17 Hall Street, Chermside Qld 4032(07) 3350 1900LJH ChermsideFor further information contactAllan Brookes on 0403 866 99980 PRIME SITELand buyerslikely to footreform costsGOING CONCERNTHE State Government’sSustainable Planning(Housing Affordability andInfrastructure Charges Re-form) Amendment Bill hascome into effect.This Bill introduces fixedmaximum infrastructurecharges that councils cancharge developers –$28,000 per three or morebedroom dwelling and$20,000 per one or two-bedroom dwelling.This Act has come aboutdue to the uncertainty,unpredictability andopaqueness of infrastruc-ture charges which the in-dustry has effectively ar-gued has resulted in stag-nating of housing supplyand higher prices.While the new Bill mightachieve increase confi-dence, questions remainabout whether it will stimu-late the building industryand improve housingaffordability.Infrastructure chargesare not a new phenomenonin high-growth areas,where governments seek toshift the cost of fundinginfrastructure from thepublic to the private sector.Australian infrastructurefunding policy dilemmasare reflected to some extentin the UK and, to a greaterextent, the US and Canada.In these countries, infra-structure cost-recoverypolicies, and the debatesurrounding them, has beenaround since the 1940s and1970s respectively.The Gold Coast CityCouncil’s fact sheet de-scribes a benefit of the newprovisions as developerspay a share of the cost ofproviding infrastructure.Are councils and govern-ments naive or just plain ill-informed to presume thatthe development industrybears any of the cost ofinfrastructure by way oflesser profits?There is extensive over-seas evidence that identifiesthe passing on (to homebuyers) or passing back (tothe en globo land seller) ofinfrastructure charges, andthe folllowing impact onhousing prices and supply.In a competitive market,the developer does not bearthis cost.Nearly a dozen researchpapers have focused exactlyon this topic in the US over20 years.This research in the USconcludes that infrastruc-ture charges not only in-crease housing prices, butincrease house prices bymore than the actual infra-structure charge applied.If the average ratio ofincrease of $1:$1.60 is ap-plied to the new maximuminfrastructure charge inQueensland, then the priceof a new three-bedroomhome could be expected toincrease by up to $45,000,purely by virtue of theinfrastructure charge alone.On the other hand, if thisincreased certainty aboutthe quantum of the infra-structure charge is passedback to the landowner, byway of developers beingwilling to pay less for theland, land owners becomeless willing to sell their landfor a lower amount, andhence supply dries up untilhouse prices rise to a levelthat again makes it attract-ive for land owners to sell.There is little argumentthat growth should pay foritself, and infrastructurecharges are one way toachieve this.The introduction of amaximum infrastructurecharge may achieve theGovernment’s objective ofincreased confidence, byintroducing some certaintyinto the development ap-proval process, but there isa real risk that this will be atthe expense of both hous-ing supply and affordability.Lyndall Bryant is a lecturerin Property Economics atQueensland University ofTechnology.Anyone wishing tocontribute can contact thePrime Site editor, ChrisHerde, on 07 3666 6645 orvia email at herdec@qnp.newsltd.com.auMoney men snap up office buildingA MACKAY office building whichfailed to sell under the hammerearlier this year has changed handsin a $1.05 million deal.The two-level, 693sq m building at12 Gregory St was sold vacantpossession to a local accounting firm.On a 736sq m site next to StPatrick College, the building has apotential rental return of $170,000 ayear when fully tenanted.It is fully airconditioned and alsohas eight parking spaces.Pat Kelly from Burgess Rawson inconjunction with Blacks Real EstateMackay negotiated the after-auctionsale.Mr Kelly said the transactionindicated strong interest in Queens-land’s regional mining areas.‘‘The mining boom is underpinn-ing the strength of these towns,’’ hesaid.Mr Kelly said the new owner ofthe Gregory St office building waslooking to secure its future and allowfor expansion.‘‘A number of parties includinginvestors and owner-occupiers com-peted for the property,’’ he said.Mr Kelly said the sale price was‘‘on market’’ for a regional officebuilding.‘‘We focus considerable time onthe regional areas . . . where there isa healthy appetite for well-positioned investments,’’ he said.‘‘Over the past two years we havesold investments in areas such asAyr, Ingham, Townsville, Bunda-berg, Hervey Bay and Gladstone.’’Phil BartschCanny canines get star spa treatmentLAP OF LUXURY: AmandaDonaldson from Doggy Divas.A DOGGY day spa with a menu ofmud treatments, aromatherapysessions, body massages and pedi-cures is one of two canine businessesthat have collared leasing deals atSanctuary Cove.Muttropolis Dog Spa has taken a77sq m space in the Marine Villageand is rolling out the red carpet forpampered pooches.Leasing rates at Sanctuary Covestart from $325/sq m.Muttropolis also offers hand-scissored style cuts, treadmill work-outs, dental brushing and colourtreatments – all in an open-plansalon with soothing classical music,fluffy white towels, essential oils andwalks around the village.Business manager Sandra Gordonsaid: ‘‘Our vision is very muchaligned with a human spa experi-ence’’.Just around the corner, DoggyDivas has secured 50sq m of spacefor its second Gold Coast boutique.It stocks everything from doggybathrobes, pyjamas, slippers andbling-encrusted collars to swimsuits,character costumes and strollers forpuppies and ageing dogs.Owner Amanda Donaldson saidthe Sanctuary Cove lifestyle and theabsence of anything similar in thevillage sealed her decision to openthe store, which focussed on‘‘fluffball’’ pooches but aimed tosource products for larger dogs.Consultants happily stand aloneLENGTHY LEASE: Alastair Dunlop who negotiated the deal for E3 Consulting Australia.Chris HerdeAN environmentalengineering consultancyhas secured a rare smallfree-standing officebuilding in the heart ofFortitude Valley.E3 ConsultingAustralia has leased thewhole of a 630sq m two-storey building at 21McLachlan St.In the deal negotiatedby Savills Australia’sAlastair Dunlop, E3Consulting has a six-yearlease on the building,which previously washome to Hynes Lawyers.The company will pay$395/sq m, or almost$250,000 a year.Mr Dunlop said thebuilding was extensivelyfitted out by the previoustenant, enabling E3Consulting to movestraight in.‘‘E3 Consulting wasfamiliar with the area,with several of theirdirectors havingpreviously worked in theadjacent street,’’ he said.‘‘While the stand-alonebuilding is 50 per centlarger than their initialrequirement, the firm isplanning on rapidexpansion.’’E3 Consulting is anenvironmental scienceand engineeringconsultancy firm that haspermanent offices inBrisbane, Sydney,Melbourne and variousproject officesthroughout Australia.The company providesan integrated, multi-disciplinary scientific,engineering andlegislative approach tothe management ofcontaminated land andenvironmentalmanagement projects.E3 Consulting waspreviously at QualtroughSt, Woolloongabba.‘‘Generally speakingthere are not manyfreestanding buildingsunder a 1000sq mavailable in FortitudeValley,’’ Mr Dunlop said.E3 Consultingprincipal Brad May saidthe new premises wereimportant for thecompany’s expansion.‘‘In order to do this, weneeded a building thatreflects our core valuesand provides a goodwork-life balance for ourstaff,’’ he said.‘‘We were very familiarwith this location and theopportunity to secure astand-alone option reallystood out.’’

Land buyers likely to foot reform costs

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