Every year in every city, there will always be a range of significant projects being developed. From new train stations, to shopping centres, schools, and road projects… while these projects are very important to their respective communities, that’s not to imply that they’ll have much (if any) bearing on local property markets.
Right now, the pipeline of major projects across Australia has never been bigger. Infrastructure Australia has 147 major project proposals, including a 2020 Priority List of 17 projects worth more than $58 billion. The various state and local governments collectively have an even bigger list of projects.
From many years of property market studies, Propertyology has drawn the conclusion that the property market impact from major project developments is determined by the scale of the economic benefits relative to the size of the community.
For example, a $10 billion infrastructure project within a large capital city may have no direct bearing on that city’s property market performance, whereas investment in a $100 million project in a completely different part of Australia may generate significant momentum for its property market.
The influence which a project has on the property market of an individual city is loosely defined as the combined sum of the jobs created during construction, the post-construction jobs, those job volumes relative to the total volume of jobs within that city, the broader economic benefit, and whether or not the project creates a legacy of improved local sentiment.
Within Propertyology’s expansive national research library is a digital catalogue of important projects. We’ve scrolled across the country, identified the major projects in respect to their potential influence on property markets, and have ranked Australia’s Top 10 projects.
The positive influence on real estate from these ten (10) major projects spans across five states. In alphabetical order, the specific city beneficiaries include Albury-Wodonga, Armidale, Beaudesert, Bendigo, Brisbane, Burnie, Cairns, Charters Towers, Dubbo, Glen Innes, Goondiwindi, Griffith, Hobart, Maroochydore, Narrabri, Parkes, Rockhampton, Seymour, Shepparton, Sydney, Tamworth, Toowoomba, Townsville, Wagga Wagga, and Whyalla.
1) Inland Rail Project
A $10 billion 1700-kilometre rail infrastructure project connecting ports in Melbourne and Brisbane to meet demand for an anticipated 75 percent increase in Australia’s freight over the next decade. Already under construction and slated for completion in 2025, the inland route was strategically chosen to more efficiently transport food and general cargo throughout the eastern states and to reduce the volume of trucks on highways. Completion of the project will provide enormous scope for Australia’s vast agricultural precincts to ramp up production as a global giant food supplier. A number of large freight terminals and logistic hubs are being developed along the route in Victoria, New South Wales and Queensland. 16,000 jobs are expected to be created during the 10-year construction phase. The post-construction economic benefits for regional communities will be substantial and will have a positive influence on property markets in communities such as Seymour, Bendigo, Shepparton, Albury-Wodonga, Wagga Wagga, Griffith, Parkes, Dubbo, Narrabri, Armidale, Goondiwindi, Toowoomba, and Beaudesert.
This project earns Numero Uno ranking from Propertyology given the considerable scale of economic benefits relative to the population sizes of the regional towns in question.
2) GFG Alliance Steelworks
A $600 million development of a new steel mill at Whyalla by British billionaire, Sanjeev Gupta. With construction due to commence late-2020, the project will enable steel production to be double the volume of the existing plant while Gupta’s $500 million Cultana solar farm will vastly improve energy costs. The estimated 1,500 jobs created by the project is very significant for a regional city which currently boasts a workforce of 10,000 and has a median house price of $200,000.
3) Western Parkland City
A series of major projects worth circa $20 billion to develop a new city in Sydney’s outer west. By 2036, the new Western Parkland City is estimated to have a population of 1.5 million, 185,000 residential dwellings, 200,000 jobs and be Australia’s third biggest economy. The $5.3 billion Nancy-Bird Walton airport will be the cornerstone of the region. Scheduled to commence operations in 2026, the airport is said to create 11,000 construction jobs and 14,000 operational jobs. 10 million (international and domestic) passengers are expected in its first year, growing to 82 million by 2060 with subsequent airport expansions. The airport surrounds will be engulfed by businesses in aerospace, defence, manufacturing, health, agribusiness, logistics, retail and education. This Aerotropolis will be developed in 10-stages over 16-years and include numerous residential projects. The initial 3-stages are anticipated to create 82,000 jobs. A further $3.6 billion is being invested to develop road networks and $2.5 billion on hospital infrastructure. Construction has also recently commenced on an $11 billion Sydney Metro Western Sydney rail project (14,000 jobs.
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4) Australia-Singapore Military Training Hubs
The Australian and Singaporean federal governments have signed an agreement for Australia to provide advance military training to 14,000 Singaporean military personnel every year for 25-years. Singapore has committed to investing $2.25 billion which will benefit Townsville and Rockhampton through facility infrastructure development. In late 2019, Laing Rourke was awarded a $800 million 4-year contract to redevelop existing training facilities at Shoalwater (1-hour north of Rockhampton) with 450 jobs anticipated at peak construction. A new $1 billion purpose-built military training facility will also be developed at Greenvale (north-west of Townsville) where site preparation commenced in February 2020 and construction should commence later this year. In addition to construction jobs, the 25-year provision of goods and services to trainees will provide long-term economic benefits to the already improved momentum in Rockhampton and Townsville, increasing the demand for real estate in both regional cities.
5) Maroochydore City
A $430 million redevelopment of a former golf course and large parcel of adjoining land into a modern CBD for the Sunshine Coast region, whose population grew at a higher rate than any other location in Australia over the last decade. The new Maroochydore city centre development will include commercial, retail, high and medium density residential development, high-speed internet, parklands, waterways, and bicycle tracks. Already under construction, the new city centre will compliment the $300 million expansion of the Sunshine Coast airport, due for international status completion by late-2020.
6) Hobart International Airport
A $200 million 3-stage expansion of the Hobart airport to accommodate international flights is due for completion before the end of the 2020 calendar year. Airport passenger volumes are forecast to double within 10-years. The recently announced $270 billion defence force program also included an intent to invest in Hobart airport facilities. As shown in the below chart, Hobart’s growth in airport passenger volumes over the last 5-years is a measurement of its spectacular economic growth that drove nation-leading real estate capital growth. One should not underestimate the enormous potential for increased economic activity through easier visitor access (business travellers, domestic and international tourists, and university students). This project is one of many which will continue to underpin Hobart’s healthy real estate outlook.
7) Queens Wharf
A $3.6 billion world-class entertainment precinct in Brisbane’s CBD, meaning that Australia’s third largest city will (finally) have a genuine attraction to compete in the lucrative tourism and leisure market. Developed across five city blocks, this game-changing project will include several high-end hotels, an international standard casino, a 1500-seat ballroom, 1,000 hotel rooms, 2,000 residential apartments, and amazing restaurants and cafes. The iconic design will boast contemporary architecture, oodles of open space, beautiful landscaping, rooftops and waterfront views. Upon completion in late-2022, Brisbane will finally have a world-class precinct to rival Melbourne’s Crown entertainment and Sydney’s Barangaroo precincts. The precinct is anticipated to attract a staggering 1.39 million visitors per year, bring billions of dollars to the coffers of Brisbane’s economy each year, create approximately 10,000 new jobs and breath an exciting new energy into the Brisbane community.
8) Battery of the Nation
Currently in the early planning stages, this $5 billion project involves using a series of lakes in north-west Tasmania to develop large volumes of hydro-electricity which will be directed to mainland Australia via a cable across the Bass Strait. It has been estimated that construction of this project will create 3,000 direct jobs, mostly in and around Burnie. The city is the unofficial capital city of north-west Tasmania, it’s home to the most productive port in the state and a new university is under construction. Burnie offers a beautiful lifestyle, some of the most affordable housing in Australia ($280,000 median house price), and tight vacancy rates.
Major projects are just ONE piece of a big suite of information within Propertyology’s expansive research portfolio. Our thought-leading market analysis draws on this information to identify locations for capital growth potential.
Using this information, our multi-award-winning buyer’s agents enjoy helping everyday Aussies to invest in strategically-chosen locations all over Australia.
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9) Narrabri Gas Project
This controversial $3.6 billion energy project in north-west NSW is well advanced in the approval process. With the aim of supplying 50 percent of NSW’s gas needs and placing downward pressure on electricity prices, development of the project will create 1,300 direct jobs and even more indirect jobs for the New England region (Narrabri, Armidale, Tamworth, and Glen Innes).
10) Hells Gate Dam
Agribusiness and general economic development for northern Australia will be big winners from this $5.3 billion irrigation and energy project by constructing an enormous dam on the upper Burdekin River, north of Charters Towers. $54 million has already been committed by the federal government to develop a smaller Stage 1 Big Rocks Weir along with completing a thorough business case assessment of the larger Hells Gate Dam by mid-2022. According to a viability assessment conducted by Townsville Enterprise, if Hells Gate Dam is developed to full capacity, it has potential to inject billions of dollars into the North Queensland economy. An estimated 12,000 jobs during construction, more than 5,000 direct and indirect jobs once completed, and 1200 megawatts of clean hydro-electricity is a significant output. The property market beneficiaries of this game-changing project will be Cairns, Townsville, Innisfail, Ingham, Ayr and Charters Towers.
Disclaimer: As exciting as these projects are, one should never make a decision as important as buying property just because of a major project announcement. Fully informed decisions require thorough assessment of the overall fundamentals of the property market of individual towns and cities.
Propertyology is a multi-award-winning buyer’s agency and Australia’s premier property market analyst. Every capital city and every non-capital city, we analyse fundamentals in every market, every day. We use this valuable research to help everyday Aussies to invest in strategically-chosen locations (literally) all over Australia. Like to know more? Contact us here.