Research commissioned bythe Property Council of Australia has revealed social infrastructure, likeschools and hospitals, are a $40 billion pillar of South-East Queensland”s economy,accounting for 25 per cent of jobs within the region.
The report shows despiteits huge injection to the economy, the perceptions of social infrastructure asan “emerging asset class” often limits investment in the sector, and in turn,leaves communities lacking vital services.
Queensland Deputy ExecutiveDirector of the Property Council Jess Caire said complex public-private fundingmodels often prevent projects from getting off the ground.
“The general lack ofunderstanding around social infrastructure “” and the fact it”s often defined asan emerging asset class “” means much-needed community projects fail to attractinvestors.
“The current pipeline ofhealth and education projects in South-East Queensland is worth $9.3 billion.Over the last 25 years, two in every five new jobs were in the health andeducation sector. Social infrastructure presents enormous opportunities, butit”s often untapped and misunderstood.
“With more than half of thecurrent social infrastructure projects being funded and delivered by theprivate sector, more needs to be done to promote the opportunities and educatethe development community on the partnership opportunities available to them indelivering these vital projects,” Ms Caire said.
Formerchair of the Property Council”s Social Infrastructure Committee and DirectorProperty & Building Catholic Archdiocesan Services Patrick Lane-Mullinssaid the size and importance of the sector means it should be viewed byinvestors as an attractive and stable investment option.
“The Property Council”sresearch highlights that the size and scale of social infrastructure, inparticular health and education, rivals” institutional investment portfolios,”Mr Lane-Mullins said.
“Social infrastructureassets typically have longer lease terms than traditional investment gradeassets, which has resulted in social infrastructure-focused funds beingestablished, representing around $10.5 billion in managed assets.
“That said, not allinvestors are aware of this and still view the sector as being on the peripheryof mainstream investment options due to the different funding models thatunderpin the sector.
“The opportunity to partnerwith non-government providers to deliver crucial projects that make a realdifference in the lives of Queenslanders needs to be highlighted to thedevelopment sector,” he said.
Australian Unity ExecutiveGeneral Manager Ryan Banting said Australian Unity recognised the opportunityin the market and could see the development potential in social infrastructureas an asset class.
“We”ve pivoted our propertyportfolio towards Social Infrastructure knowing there is a big future here thatcan deliver multiple outcomes simultaneously. It can meet community needs,create job opportunities and provide attractive returns for our investors,” hesaid.
“Partnering with governmentthrough innovative delivery models creates significant economic and communitybenefit.
“The Herston QuarterRedevelopment is an excellent example of how innovative partnership approachesdeliver positive outcomes for stakeholders and the broader community.
“Based on facilitiescompleted to date, it is estimated that Herston Quarter has already created$650 million of community benefits per annum and generated an economiccontribution of $128 million,” Mr Banting said.
“Continuing toshowcase partnerships such as these, while spotlighting the enormouscontribution social infrastructure makes economically and to our broadercommunity, should be a key focus for decision makers.
“The report commissioned bythe Property Council only takes into account non-government education andhealth assets, however, social infrastructure also includes sport andrecreation, culture, community support, emergency services assets, and muchmore.
At Australian Unity ourvision for the growth of the social infrastructure sector, includes health andeducation assets, but also includes investment in aged care, retirement livingand specialist disability accommodation.
“Since the commissioning ofthe report, it is worth noting, there has been an additional $9 billioncommitment in hospital investment over the next five years by the QLDGovernment which has increased the pipeline exponentially,” Mr Banting said.
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