Townsville can shine with the help of private investment and population growth. But not without a clear economic plan and incentives to lower the cost of business, says the Property Council.
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Three key takeaways:
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As the Townsville City Deal undergoes a three-year review process, the time is right to revisit the framework and engage with local stakeholders, says the Property Council’s Queensland executive director Chris Mountford.
The 15-year commitment between the Commonwealth, Queensland Government and Townsville City Council was signed in December 2016. It outlines a series of investments, including a 25,000-seat stadium, an upgrade to the port, an entertainment and convention centre, and water security and energy productivity projects, among others.
Since the Townsville City Deal was signed, several other government plans have been produced including the North Queensland Regional Plan.
“It’s important that these plans complement each other and provide a clear pathway for private investment as well as infrastructure delivery,” Mountford emphasises.
The Property Council is calling for stimulus policies to create economic activity and jobs as part of Queensland’s post-COVID economic recovery. In recent weeks, the Queensland Government has announced a $200 million Building Acceleration Fund to support development of catalytic infrastructure and opened applications for the HomeBuilder grant.
The Property Council has been a strong advocate of these two stimulus measures and Mountford welcomes the government’s announcements.
“The HomeBuilder scheme has had the desired effect of stimulating demand with many of our members experiencing good inquiry levels and sales in Townsville,” Mountford says.
“However, as the economic challenge resulting from the heath crisis increases, further action is required to fast-track the economic recovery.”
Teri Humphreys is chair of the Property Council’s regional Townsville chapter. She says incentives and economic stimulus have accelerated construction in new housing “and development applications have increased to levels not seen in more than five years”.
The managing director of Townsville Earthmoving, Humphreys says a 30 per cent increase in new housing approvals over the same time last year is a “welcome relief”.
“Agents have reported an increase in interstate enquiries for established residential properties, which is an encouraging sign that investment is returning.”
Reducing red tape is critical, Humphreys warns.
“New homes do not get built if projects are not feasible and banks will not lend money to projects that cannot show a profit – particularly now.”
Property propels jobs and growth
Townsville’s property industry accounts for 16.5 per cent of all jobs, “so the ability for the industry to be a jobs generator is fundamental for the recovery,” Mountford explains.
But to do so requires a “different approach” to that taken by Queensland Government in the past.
“Over the past five years property tax hikes have sent the exact opposite message to potential investors,” Mountford says.
“Other jurisdictions have already recognised this and have thrown out the rulebook to seek out new investment opportunities.”
As the competition for private capital investment intensifies, Queensland needs “to be a first mover to gain an advantage”.
Stephen Motti, senior principal of land development consultancy Brazier Motti, agrees.
“With access to minerals, agricultural and tourism sectors, and with governance structures such as a City Deal already in place, there is opportunity to leverage returns sooner than from other localities,” Motti, a member of the Property Council’s regional Townsville chapter, explains.
“Recent trends of net internal migration away from the city, however, show that further intervention is needed. We cannot afford to get caught at the starting gate. Private investment is vital – with cheap capital and aggressive and creative incentives being offered globally, we have to think differently and act with urgency.”
Mountford points to the NSW Government’s decision to halve land tax payments for 20 years for build-to-rent developments and remove any foreign investor barriers.
“This presents a clear signal to investors that the NSW Government will provide support to this new sector if you are willing to invest. It’s this type of thinking and action that is needed in Queensland if we are to accelerate the economic recovery.”
Leading into the Queensland state election on 31 October, the Property Council is focused on promoting a suite of forward-thing actions to unlock activity in the property industry and to create jobs in Townsville and cities across Queensland.
“COVID-19 has thrown a range of challenges at us, and given our current level of debt, we cannot rely on the state’s balance sheet to spend our way out of recession. Now is the time to be bold, innovative, and to move policy ideas across from the ‘too hard basket’,” Mountford adds.
“Great ideas are out there, many costing government little to nothing to implement, but providing billions of dollars of investment and jobs in return.”