GOSFORD RESIDENTIAL MARKET ASSESSMENT
PreparedforALAND
COVID-19ANDTHE POTENTIALIMPACTON DATAINFORMATION
Thedataandinformationthatinformsandsupports ouropinions,estimates,surveys,forecasts, projections,conclusion,judgments,assumptionsand recommendationscontainedinthisreport(Report Content)arepredominantlygeneratedoverlong periods,andisreflectiveofthecircumstances applyinginthepast.Significanteconomic,healthand otherlocalandworldeventscan,however,takea periodoftimeforthemarkettoabsorbandtobe reflectedinsuchdataandinformation.Inmany instancesachangeinmarketthinkingandactual marketconditionsasatthedateofthisreportmay notbereflectedinthedataandinformationusedto supporttheReportContent.
TherecentinternationaloutbreakoftheNovel Coronavirus(COVID-19),whichtheWorldHealth Organisationdeclaredaglobalhealthemergencyin January2020andpandemicon11March2020,has andcontinuestocauseconsiderablebusiness uncertaintywhichinturnmateriallyimpactsmarket conditionsandtheAustralianandworldeconomies morebroadly.
Theuncertaintyhasandiscontinuingtoimpactthe Australianrealestatemarketandbusiness operations.Thefullextentoftheimpactonthereal estatemarketandmorebroadlyontheAustralian economyandhowlongthatimpactwilllastisnot knownanditisnotpossibletoaccuratelyand definitivelypredict.Somebusinesssectors,suchas theretail,hotelandtourismsectors,havereported materialimpactsontradingperformance.For example,ShoppingCentreoperatorsarereporting materialreductionsinfoottrafficnumbers, particularlyincentresthatordinarilyexperiencea highproportionofinternationalvisitors.
Thedataandinformationthatinformsandsupports theReportContentiscurrentasatthedateofthis reportand(unlessotherwisespecificallystatedinthe Report)doesnotnecessarilyreflectthefullimpactof theCOVID-19OutbreakontheAustralianeconomy,
theasset(s)andanyassociatedbusinessoperations towhichthereportrelates.Itisnotpossibleto ascertainwithcertaintyatthistimehowthemarket andtheAustralianeconomymorebroadlywill respondtothisunprecedentedeventandthevarious programsandinitiativesgovernmentshaveadopted inattemptingtoaddressitsimpact.Itispossiblethat themarketconditionsapplyingtotheasset(s)and anyassociatedbusinessoperationstowhichthe reportrelatesandthebusinesssectortowhichthey belonghasbeen,andmaybefurther,materially impactedbytheCOVID-19Outbreakwithinashort spaceoftimeandthatitwillhavealongerlasting impactthanwehaveassumed.Clearly,theCOVID19Outbreakisanimportantriskfactoryoumust carefullyconsiderwhenrelyingonthereportandthe ReportContent.
Wherewehavesoughttoaddresstheimpactofthe COVID-19OutbreakintheReport,wehavehadto makeestimates,assumptions,conclusionsand judgementsthat(unlessotherwisespecificallystated intheReport)arenotdirectlysupportedbyavailable andreliabledataandinformation.AnyReport ContentaddressingtheimpactoftheCOVID-19 Outbreakontheasset(s)andanyassociated businessoperationstowhichthereportrelatesorthe Australianeconomymorebroadlyis(unless otherwisespecificallystatedintheReport) unsupportedbyspecificandreliabledataand informationandmustnotbereliedon.
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EXECUTIVESUMMARY
ProjectBackground
ALANDownsalargedevelopmentsiteat108-118DonnisonStreet,Gosford. ALANDrequiresmarketevidencetoinformthedesignoftheprojectandensure thattheoffermeetsmarketneeds.Urbishasbeenengagedtoassessthemarket potentialforresidentialapartments.
SubjectSite
ThesubjectsiteisincloseproximitytoGosfordtrainstation.Thesiteisextremely welllocatedinregardtolocalamenity,withplentifulentertainment,public transport,employmentcentresandamajorhospitalalllocatedwithinGosford. Thedevelopmentisproposedtocompriseresidential,shortstayaccommodation andsomehospitalityandbeveragewhichwillbringinmorevisitorstotheregion andincreaseamenityavailabletofutureresidents.
ResidentialAssessment
Gosfordisanaffordablelocation,locatedonlyanhourfromnorthernareasof Sydney.Thereisaneedfordevelopmentstocatertoworkingprofessionalsand localinvestorswhilealsocateringtowardsthehigherendofthemarketdesiring luxuryhousingwithinthewaterfrontarea.
Keyresidentialdriverssuchaspublictransport,majorshoppingcentres, hospitals,schoolsandemploymentprecinctssupporttheGosfordapartment market.Overall,theStudyAreahasaveragedaround200newapartmentsales peryear,overthepastfiveyears.
Residentialapartmentsaresupportedonthesubjectsitewithkeyfindings/ recommendationscomprising:
•Take-Up:Basedonhistoricalandprojecteddemandandcompetition,the SubjectSitecouldachieveasalesrateofaround50-60peryear(about5-6 permonth)in2023andafter.However,thereisariskofadeteriorationinthe market,withinflationandinterestratesrising.
•BuyerMix:Itisanticipatedthatmostbuyerswillbefirsthomebuyers,or investors,followedbysmallerproportionofdownsizers.
•Mix:Recommendedthatmostapartmentsinthedevelopmentcontaintwo bedroomsandtwobathrooms.Thisproductisattractivetobothyounger couplesandinvestors,whicharelikelytobethemajorbuyersegmentsforthe project.One-bedroomapartmentsarealsoattractivetosomefirsthome buyersandinvestors,althoughthemajoritywouldbelookingfortwobedrooms duetotherelativeaffordabilityinthemarket.Three-bedroomapartments shouldaccountfor10-15%ofdwellings,targetingthesmallerportionofbuyers attractedtolargerapartmentsontheCentralCoast.
•ApartmentSizesandPositioning:Therecommendedinternalsizesshown belowarebasedonacomparisonwithrecentprojectswithconsiderationthat slightlylargersizeswouldassistwithattainingapremiummarket.
•Prices:Thepricesareindicativeandwilldependonmanyfactors,suchasthe finaldesignandqualityoftheproject.Theproject'sprojectedsalespricesin $2022havebeenestimatedbasedonrecentoff-the-planpricesandnew apartmentresalesinthearea.Thepricesconsidertheincreasing attractivenessoftheCentralCoasttoSydneysiders,sincetheCOVID-19 pandemic.Thisenablesdevelopmentstoattractmoreaffluentbuyers.Assuch charginghighercomparablepricesthancomparabledevelopmentssuchas BonythonTowerisattainableforALAND.
INTRODUCTION
ProjectBackground
ALANDPropertyDevelopmentshaspurchaseda large-mixeduse,DevelopmentApplication(DA) approvedsiteon108DonnisonSt,Gosford (“SubjectSite”).ALANDrequiresmarketevidence toinformthefinaldesignoftheprojecttoensure thattheoffermeetsthemarketneeds.
Urbishasbeenengagedtoassessthemarket potentialforresidentialapartmentsontheSubject Site.
Theresidentialassessmentwillinvolvethe analysisofthefollowing:
•ArelevantresidentialStudyArea;
•Populationanddemographicanalysesforthe StudyArea;
•Analysinghistoricalbuildingcompletionand approvaldataalongwithfutureapartment supply;
•Competitoranalysis;
•Analysingmarketdemand;and
•Providingrecommendationsfordevelopment mixandpricing.
DraftBuildingPlans
SUBJECTSITE
KeyFindings
Thesubjectsiteislocatedat108DonnisonStreet, Gosfordandcomprisesanareaofapproximately 5,654sq.m.Thesiteislocatedonthecornerof Mann,BakerandDonnisonStreetsinGosford.
Surroundinglandusescomprise:
•GosfordTrainStation,GosfordHospitaland threelocalschoolstothenorth.
•TheImperialShoppingCentretotheNortheast ofthesubjectsite
•Retail,commercialandresidentialapartments surroundingthesite,includingtheCentral CoastLeaguesClubtothesouth-west.
•CentralCoastStadiumtothesouth-westofthe subjectsite.
Mosthigh-densityresidentialbuildingsonthe CentralCoastarelocatedwithinGosfordCBDand itssurroundswithmanylocatedalongMannSt.
Therearesporadicmediumdensityresidential developmentsinotherareassuchasWoyWoy andTerrigal.
108DonnisonStreet,Gosford(SubjectSite)
DRAFTPLANS
KeyFindings
Thedraftplansforthesubjectsitecomprisea mixed-usedevelopmentacrosstwotowers,which willincluderesidential,shortstayaccommodation, commercialandagroundfloorpub.
Thetowersbeingdevelopedwillconsistofatotal of323residentialunits.Thebreakdownisas follows:
Thebuildingswillconsistof28levelsincluding groundfloorretail/Pubtenancies(1,954sq.m) abovefourlevelsofcarparkingwith714parking spacesacrossthetwobuildings.TheWestTower willincluderesidentialusesonfloors5-27,with carparkingbelow.TheEasttowerwillinclude hotelaccommodationonlevels5-11,totalling133 roomsalongwithresidentialonfloors12-27. Thefloorspacebreakdownforthetwobuildingsis asfollows:
•ResidentialUnits:31,468sq.mGFA
•Hotel:10,987sq.mGFA
•Retail/Pub:1,954GFA
•Carparking:714parkingspots
STUDYAREA DEFINITION
RESIDENTIALSTUDYAREA
KeyFindings
TheResidentialStudyAreareferstothe geographicmarketforapartmentsonthesubject site.Itisboundedby:
•PacificMotorwaytothewest
•Patongatothesouth
•TerrigalandNorthAvocatotheeast
•CutrockRoadtothenorth.
ThisStudyAreawasdefinedbyassessing migrationstatisticsfromthe2016ABSCensus. 2021ABSCensusmigrationdataisnotavailable untilOctober2022.Thesestatisticsidentifythe originoflocalresidentsand,therefore,providean indicationoftheareafromwhicharesidential developmentatthesubjectsitewoulddraw residentsfrom.
TheStudyAreaincludesthebulkofapartment developmentsinGosfordandsurroundsandalso developmentsinothercentreslikeWoyWoy, ErinaandTerrigal.
AsshowninMapoverleaf,allsurrounding StatisticalAreaTwo’s(SA2s)thataccountforat leasta1%shareofnewresidentsintheGosford–SpringfieldSA2(wherethesubjectsiteislocated) formtheResidentialStudyArea.
StudyAreaOutline
SourceUrbis
MIGRATIONANALYSIS
KeyFindings
Themaprightoutlinesthe2011-2016ABS CensusmigrationdatafortheCentralCoast region.2021ABSCensusdataisnotavailable untilthestage2releaseinOctober2022.
Themigrationdatashowstheplaceofresidence forcurrentGosford-SpringfieldSA2residents comparedto2011.Forexample,1.3%ofGosford –SpringfieldResidentsin2016movedfromthe Niagara-LisarowSA2sincethe2011census.
AllsurroundingStatisticalAreaTwo’s(SA2s)that accountforatleasta1%shareofnewresidentsin theGosford–SpringfieldSA2(wherethesubject siteislocated)wereincludedintheResidential StudyArea.
Themapalsohighlightsnewresidentsintothe Gosford–SpringfieldSA2frombeyondthe CentralCoastLGA:
−MetropolitanSydney(10.7%)
−Overseas(5.4%)
−RegionalNSW(3.2%)
−Interstate(2.4%)
Assuch,theproposeddevelopmentisexpectedto competewiththeproposeddevelopmentswithin thisStudyArea.
Thefollowingsectionassessesthelikelydemand foradditionalapartmentswithintheStudyArea andtheirsupportabilityonthesubjectsite.
SourceUrbis
HISTORICALPOPULATIONGROWTH
KeyFindings
Therateandextentoffuturepopulationgrowthin theStudyAreawillhaveasubstantialbearingon futuredemandforresidentialdwellingswithinthe SubjectSite.
ThepopulationintheStudyAreahasgrownfrom 122,759in2012to129,357in2022.This representsanadditional6,598residents,atan annualgrowthrateof0.5%.
Growthasapercentagehasbeenstablesince 2012,withahighof0.9%experiencedin2021. Thishighgrowthrateislikelytocontinuewiththe CentralCoastregionbecominganattractive destinationforrelocationofresidentsfromGreater Sydney.
Acrossthisperiod,theGosford–SpringfieldSA2 (withintheStudyArea)hasgrownfrom18,932to 20,569atanannualgrowthrateof0.8%,a sizeableandaboveaverageincreasewithinthe StudyArea.Increasingpopulationleadstogreater demandforhousing.
ThegrowthoftheStudyAreapopulationby componentdemonstratestheeffectthepandemic hadonNetOverseasMigration,withthis componentshrinkingfrom659in2019to10in 2022.Withinternationalbordersbeingreopened, NetOverseasMigrationisexpectedtopickupin thecomingyears,whileNetInternalMigrationwill continuetobesignificant.Acrosstheprevious fouryearstherehasbeenlittlegrowthfromnatural increase,meaningthatgrowthhascomefrom peoplemovingwithinAustraliatotheStudyArea orfromoverseastoAustralia.Thistrendissetto remainconstantinthemedium-term.
FORECASTPOPULATIONGROWTH
KeyFindings
Theforecastpopulationgrowthwillsignificantly impacttheassessmentofdemandforhousing withintheStudyArea.
TheStudyAreaisprojectedtogrowto150,809 residentsfrom129,357overthe20yearsto2041, anadditional21,458residents.Thiswillresultin increaseddemandforhousingwithintheStudy Area.
TheStudyAreaisforecasttohaveanannual growthrateof0.8%overtheperiod2022-41.This isincomparisontotheGreaterSydneyforecast growthrateof1.1%.Thegrowthrateofthe Gosford–SpringfieldSA2isprojectedtobe1.5% overthetimeperiod,reflectingadesirabilityofthe locationandthehighamountofresidential developmentexpectedtooccurinthearea. Therefore,therewillstillbestrongdemandfor housingwithintheGosfordareaitself.
TheprojectedagedistributionwithintheStudy Areafrom2021to2041isshownonthebottom chart.Theproportionofresidentsaged60and aboveisforecasttoincreasefrom28.2%in2021 to31.8%by2041.Thisgrowingcohortmeans thereisasubstantialmarketsegmentfor apartmentsinthefutureasolderresidentslookto downsizeandworkerslookforaccommodation closetotheGosfordCBDanditsamenities.
Source:DepartmentofPlanningandEnvironment
Source:Urbis,DepartmentofPlanningandEnvironment
ForecastPopulationGrowth,2023-2041(StudyArea)
ForecastPopulationGrowthbyAge,2021-41(StudyArea)
HOUSEHOLDGROWTH
KeyFindings
Householdtypeprojectionsareanimportantfactor fordeterminingwhattypeofapartmentswillbein demandinthefuture.
IntheStudyArea,Lonepersonhouseholdsare expectedtogrowby2.7%from28.8%in2021to 31.5%in2041.Thiswillincreasethedemandfor studioand1bedroomdwellings.
Couplewithchildrenhouseholdsareexpectedto declineby3%from27.3%in2021to24.3%in 2041.Thiswillreducethedemandfor2-3 bedroomdwellings.
Otherhouseholdtypesareseeingminimalchange and,therefore,shouldnotsignificantlyaffectthe demandforhousingtypes.
Asaresultoftheincreaseinloneperson households,thehouseholdsizeintheStudyArea isforecasttodecreasefrom2.50to2.37overthe studyperiod(to2041).Thehouseholdsizeis significantlylowerintheGosford–SpringfieldSA2 at2.17comparedtotheStudyAreaandGreater SydneyRegionat2.5and2.71respectively.
Lowerhouseholdsizeswillleadtomoredwellings requiredperperson,whichmeansthemarket demandfordwellingsincreases.
HouseholdTypeProjections(StudyArea)
EMPLOYMENTFORECAST
KeyFindings
TheamountofjobsintheStudyAreahasacrucial roleinimpactingthedemandforhousingas peoplewantohaveaccesstoemployment.
FortheStudyArea,TransportforNSWforecasts thattotalemploymentwillincreaseby9,604jobs overtheperiod2021-41.Thisrepresentsan annualgrowthrateof4.9%.Theseextrajobswill attractmorepeopletotheStudyArea.
Theindustrywiththemostadditionaljobsisthe HealthCareandSocialAssistancesectorwithan additional2,573forecastjobsatanannualgrowth rateof5.6%.Muchofthisgrowthisbecauseof theexpansionoftheGosfordHospitaland increasedalliedhealthservicesassociatedwith thehospital.
Theindustryforecasttohavethehighestannual growthrateisEducationandTraining.This reflectsthegreaterproportionofeducation professionalsintheareawiththeconstructionof theCentralCoastClinicalSchool.
ThetableshowsthatemploymentintheStudy Areamainlyconsistsofworkersintheservices industry.IndustrysectorssuchasManufacturing, Agriculture,ForestryandFishing,andMining makeupasmallamountoftheforecast employment.
DEMOGRAPHICCHARACTERISTICS
KeyFindings
Whencomparingthedemographicprofileofthe studareawithGreaterSydneythemostprominent differencesarethemoreelderlypopulationand smallerhouseholdsintheStudyArea.
TheStudyAreahasanaverageageof42.7, approximately15%greaterthantheSydney average.Thisindicatestheareawillhaveahigher demandfor1-2bedroomdwellings,
TheaveragehouseholdsizeoftheStudyAreais 2.4,approximately11%lessthanGreaterSydney. Alowerhouseholdsizeindicatesthattherewillbe agreaterdemandfordwellingsintheStudyArea. ApartfromthesecharacteristicstheStudyAreais notsubstantiallydifferentfromgreaterSydney.
Currently2021ABSCensusdataisnotavailable forEducationandworkforceinformation.Dataon employmentandeducationwasobtainedfromthe 2016census.
Asof2016,71%oftheStudyAreasworkforce wasclassifiedaswhitecollarworkers.Thisisin accordancewiththeABS’sdefinitionofWhite collarworkersasbeingthosewho’soccupationis classifiedasbeingoneofthefollowing:Manager, Professional,CommunityandPersonalService, ClericalandAdministrativeWorkerorSales Workers.
TheStudyAreahasaloweducationalattainment comparedtotheGreaterSydneyaverage. Howeverwiththeincreasingnumberofindividuals movingtotheareafromSydneythisisexpected tochangeincomingyears. KeyDemographicCharacteristics,2021(StudyArea)
Avg.HouseholdSize
Couplefamilywithchildren<15
%ofHighIncomeEarners
Aged0-14
Source:Urbis,ABSCensus2021
VariationFromSydneyAverage
StudyArea
Source:Urbis,ABSCensus2016
TARGETBUYERMARKET
KeyFindings
Theapartmentsforthedevelopmentwilllikelybe purchasedbyamixoffirsthomebuyers,investors andasmallerpercentageofdownsizers.
Theareadoesnothaveahighpercentageof residentsagedbetween25-39at17%asof2021, however,thedriversforfirsthomebuyerscoming totheareaarestrongincludingaccesstojobsand healthservices.Furthermore,thecompetitor analysishasshownthatsimilardevelopments haveattractedahighproportionoffirsthome buyers.
Investorsareakeytargetbuyermarket, particularlylocalinvestors.Thisisduetothe stronggrowthinunitpricesintheStudyAreaand comparativelycheaperpricesofunitsthatenable localinvestorstopurchase.
TheStudyAreaishometoarelativelylarge proportionof60+yearoldresidentswith28.2% accountedforbythisagegroupasof2021.This agecohortisprojectedtoincreasestronglyto 31.8%in2041.Thisageingpopulationwillleadto anincreasedmarketfordownsizers,inturn leadingtoincreaseddemandfor1–2bedroom units.Asofthe2021Census,around75%of householdsintheCentralCoastLGAhave3or morebedrooms.Combinedwiththelowerthan averagehouseholdsizeintheStudyArea highlightsthereisdemandforresidentsto downsize.However,itislikelydownsizerswould preferdevelopmentsintheareathataremore secludedandhavebetterviewsofthewaterfront.
BuyerSegments
APARTMENTSUPPLY
KeyFindings
Thissectionassessestheexistingandproposed supplyofresidentialdwellingsintheStudyArea.
Dwellingapprovalspeakedin2018,witha subsequentdropinapprovalsin2019and remainingatalowerlevelin2020and2021. Altogether,dwellingapprovalsaveraged967from 2016-18whileaveraging437perannumfrom 2019-21.Dwellingcompletionssubsequently increasedafterthepeakofapprovalsin2018 indicatingthatmostapprovalswereconvertedinto construction.
Apartmentswereaconsiderableportionof dwellingapprovalsfrom2016to2019.Thelevelof apartmentapprovalspeakedin2018at1,017 approvalsandhavereducedeachyear subsequentlytoreachalowof99approvalsin 2021.Thisindicatesthenumberofcompleted apartmentsintheStudyAreawilllikelyremainlow inthecomingyears.
Dwellingcompletionsdecreasedafter2019dueto theslowdownintheapartmentmarket,withthe startoftheCOVID-19pandemicin2020further contributingtothisdecline.
DwellingcompletionsfortheStudyAreabetween 2016to2021averagedapproximately633per annum.Thenumberofcompletedapartments reachedahighof959in2019beforedecliningto alowof235in2021.
Overall,therehasbeenasubstantialdeclinein dwellingapprovalsandcompletionsintheStudy Areasince2019withuncertaintyregardinghow thesewillperformintheshorttomediumtermdue torisinginterestratesandrisingconstruction costs.
DwellingApprovals2016to2021(StudyArea)
DwellingCompletions2016to2021(StudyArea)
FUTUREAPARTMENTSUPPLY
KeyFindings
AccordingtoCordellConnectandUrbisresearch, therearearound37proposedapartmentprojects (with25+units)withintheStudyAreathathave thepotentialtobecompletedby2027,comprising atotalof4,826units.Theseprojectsareeither underconstruction,haveachieveddevelopment approvalorhaveappliedfordevelopment approval.
AccordingtoCordellConnectapproximately:
•419dwellingshavecommencedconstruction, •3,088dwellingshavegaineddevelopment approval,
•990areinthedevelopmentapplicationstage and
•288dwellingsarestillintheearlyplanning stage.
Thedwellingswhichareunderconstructionor haveachieveddevelopmentapprovalcanbe consideredmorelikelytobebuilt,whilethosein thedevelopmentapplicationandearlyplanning stagesarelesscertaintocomplete.
Somerecentlyabandonedordelayedmajor residentialprojectshavereducedthefuture apartmentsupplypipelineintheStudyArea.Most notablytheGosfordAliveprojecthasbeenplaced onholdafterreceivingconditionalapprovalin 2020.Theprojectwassettodeliverfive residentialtowerscontaining1,414units.Thereis stillconsiderableuncertaintyastowhetheror whenthisprojectwillbedelivered.Thecompletion ofthisprojectwouldhaveamajoreffectonthe localapartmentmarket.
Source:Urbis,CordellConnect
ProposedApartmentsbyStatus2022-2027(StudyArea)
FUTUREAPARTMENTSUPPLY
KeyFindings
Thevastmajorityoflargeapartmentprojects withintheStudyAreaandinthedevelopment pipelinearelocatedinandaroundtheGosford CBD.Someofthekeydevelopmentareasinclude:
•GosfordCBD:21largeresidentialprojects comprising3,123units.
•NorthGosford:ninelargeresidentialprojects comprising854units.
•GosfordWest:Tworesidentialprojects comprising234units.
•PointFrederick:Tworesidentialprojects plannedwithatotalof140units.Oneproject comprising101units,whichisunder construction.
Therearethreeprojectswithover25unitslocated outsideofGosfordandsurroundingsuburbs(West Gosford,NorthGosfordandPointFrederick). TheseincludeadevelopmentinKaraltaRoad Erinacomprising131units,whichisinthe developmentapplicationstage.Thereareanother twoprojectsinEttalongBeachcomprisinga combined77units,includingoneunder construction.
ProposedApartments(StudyArea)
COMPETITIONSUMMARY
KeyCompetingLocations
Competinglocationsarethosewhichare competingdirectlyforpotentialbuyerswiththe subjectsite.Theyare:
•Apartmentdevelopmentscloselylocatedto amenities,mostlikelywithintheGosfordCBD.
•Significantapartmentdevelopmentswithinthe GosfordCBDwithover100units.
•Thesedevelopmentsareclosetoamenities suchasthehospital,trainstationandschools. GosfordCBDisauniquemarket,offeringahigh rangeofamenitieswithineasywalkingdistance whilebeinginaregionallocationnearbynational parkssuchasBrisbaneWaterNationalPark. WithintheCBD,orwithinwalkingdistanceare schools,GosfordHospital,Gosfordwaterfront, CentralCoastStadiumalongsideplentifulretail, cafesandothershoppingdestinations.
WithintheCentralCoastLGA,Gosford’s neighbouringsuburbPointFredrickisalso experiencinganinfluxofsignificantdevelopments. Thesesiteswillalsobecompetinglocationsfor buyerslookingintheGosfordarea.
OutsideoftheLGA,locationsinregionalareas likeNewcastleorWollongongandWestern SydneyLGA’sprovidesomecompetitioninterms ofdistancefromtheSydneyCBDandother amenitiesbutcannotcompetewithsomeof Gosford’sotheruniquemarketfeatures.For example,NewcastleisfurtherfromtheSydney CBD,whileWesternSydneydoesnothaveocean views.
DwellingMix
ThedwellingmixoftheprojectswithintheStudy Areaismixed,butcomprisesprimarilyoftwo bedroomunits.Gosfordanditssurroundingareas haverecentlyseenaninfluxofluxury developments,withstrongtransportsystemsand increasingworkplaceflexibilitycontributingtothe feasibilityoflivingoutsideoftheSydney metropolitanarea.Oftheprofiledprojects,the averagemixwas:
•Studio:4.7%
•1Bed:24.6%
•2Bed:59.2%
•3Bed:9.9%
•4Bed/Penthouse:1.6%
GrowinginterestinGosfordanditssurrounding areashasresultedinahighlymixedbuyerprofile. Theprofileddevelopmentshaveseenbuyersthat include:
•firsthomebuyers,
•youngbuyerswhoarenotbuyingtheirfirst home, •investors,and •downsizers.
Thestrongmixofbuyersisreflectedinthediverse offeringprovidedintheGosforddevelopments, witharangeofunitfloorspaceamongstthosewith thesamenumberofbedrooms,locationand design.
Pricing
Gosfordhasrecentlyseenamajorinfluxinboth supplyanddemand,meaningthatthemarkethas changedsignificantly.Theincreasedsupplyhas alsobroughtaboutincreasedquality,withluxury styleapartmentsbecomingmoreprominent. TheHorizondevelopmentrepresentstheclosest comparable,basedonaverageapartmentsize andrelativelocation,However,Horizoniscloser toGosfordHospitalandlocalschools,hasaround halfthenumberofproposedapartmentsandis proposedtoincludefourrestaurantsandan upscalesupermarketinitslobby.The developmentisadvertisingastartingpricefortwo bedroom,twobathroomunitsfrom$530,000. Forbothunder-constructionandrecently completeddevelopments,thispricepoint representsthelowerendofpricesfortwo bedroomunits.Theprofileddevelopments indicatearangeofpricesfrom$530,000to $1,000,000fortwobedroomunits,howeverthe higherpricepointsalsotendtoexhibitwaterfront viewsorgreatersquaremeterage.
Theresalepricesforrecentlycompleted developmentshavebeencomparabletothe pricesforoff-the-plandevelopmentscurrently underconstruction.
10/08/2022
HORIZON,GOSFORD
Source:HorizonGosford
DeveloperJMGM
Location321-331MannStreet,Gosford
CouncilAreaCentralCoast
Location
Characteristics
•LocatedwithinGosfordCBD
•500metresfromGosfordHospital
•500metresfromGosfordTrainStation
•300metresfromGosfordHighSchool
CompletionQ32024
ProjectLaunch
DateJanuary2021
StatusUnderConstruction
TotalUnits174*
Property
Description
•Amixed-usebuildingwith15levelsofresidential units,commercialspaceand2,500sq.mofretailon thegroundfloor.
•265carparkingspacesprovided.
•Residentsonlygymandpool,luxuriousfitoutand choiceofthreedifferentcolourschemes.
Studio 1632From$342,000
1Bed,1Bathroom5650-55From$448,000
2Bed,2Bathroom7075-100From$530,000
3Bed,2Bathroom28107.5From$772,000
Penthouse
4170From$1,700,000
Parking 265spaces
AncillaryFacilities
Take-upRates
BuyerProfile
*Basedonagentadvice **PricesadvertisedasofAugust2022.
OutdoorswimmingpoolandSwedishsauna,steamroom,gym andworkoutspace,communityroom.
Agentcouldnotprovidethetake-uprate.
Theagentindicatedabuyerprofilethatincludesinvestors,first homebuyersandyoungerbuyerswhoarenotfirsthome buyers.
Source:HorizonGosford
PENINSULA,POINTFREDERICK
Source:PeninsulaPointFredrick
DeveloperMasscon
Location177-179AlbanyStreet,PointFredrick
CouncilAreaCentralCoast
Location
Characteristics
•1.4kmfromCentralCoastStadium
•1.9kmfromGosfordTrainStation
•2.9kmfromGosfordHospital
•Walkingdistancetorestaurants,cafesandwaterside trails
•15minutedrivetopopularbeaches
•10minutedrivetoErinaFairShoppingCentre
CompletionQ32022
ProjectLaunch
DateAugust2019
StatusUnderConstruction
TotalUnits100
•Threeboutique-stylebuildings.
•FeaturesviewsoverlookingBrisbaneWater.
Property
Description
•Utilisesenergy-efficienttechnology.
•Securebasementparkingandliftaccess.
•LocatedinsecludedsuburbofPointFrederick
1Bed,1Bathroom 453-55NotProvided
1Bed,1Bathroom+Study1350.5-56$450,000-$550,000
2Bed,2Bathroom3473-106$650,000-$980,000
2Bed,2Bathroom+Study982-106$835,000-$885,000
3Bed,2Bathroom36111.5–128.5$950,000-$1,450,000
3Bed,2Bathroom+ Study/Penthouse 3147-150$2,400,000-$3,200,000
Parking 147carspaces,7motorcyclespaces,42bicyclespaces.
AncillaryFacilitiesBasementlevelgymnasiumandshowerandtoiletfacilities.
Take-upRates
BuyerProfile
Theagentadvisedthat82apartmentshadbeensoldovera12 monthperiodequatingtoatakeuprateof6.8salespermonth.
60%owneroccupiers,40%investors.Mainlydownsizersand owneroccupiers.
*Basedonpublishedfloorplans **PricesadvertisedasofAugust2022.
Source:Domain
Source:PeninsulaPointFredrick
THEWATERFRONT,GOSFORD
DeveloperStHilliers
Location26-30MannStreet,Gosford
CouncilAreaCentralCoast
Location
Characteristics
•LocatedontheedgeoftheGosfordCBD
•600metresfromGosfordTrainStation
•WithinwalkingdistanceofCentralCoastStadium
•200metresfromGosfordWaterfrontPark
CompletionQ22024
ProjectLaunch
Date October2021
StatusUnderConstruction
TotalUnits136
•Stage1ofthe3-stageCentralCoastQuarterdining andretailprecinct.
Property
Description
•621sqmofretailspaceandbasementparkingfor181 vehiclesand63bicycles.
•FeaturesviewsoverlookingBrisbaneWater.
•AdjacenttonewlydevelopedGosfordPark Type
1Bed,1Bathroom1456$477,750-$585,000
2Bed,2Bathroom10376-90$620,000-$1,000,000
3Bed,2Bathroom14120$1,300,000-$1,500,000
Penthouses,3-4Bed,2-3 Bathroom,2car 5240$1,880,000-$3,200,000
Parking 181parkingspacesand63bicyclespaces
AncillaryFacilities
Skyloungewithpanoramicviews,exclusivetoresidents. Communalpodiumlevelaccessibletoallresidentsdesignedto evokeasenseofcommunity
LocatedintheCentralCoast’sretailanddiningprecinct
Take-upRates Around65%ofallapartmentsweresoldwithinfirst3months equatingto29.5salespermonth.Over90%ofapartments weresoldasofJuly2022,indicatingatotaltakeuprateof11.1
BuyerProfile Mixofluxurybuyersinterestedindownsizing,andpeople lookingforalifestylechangewhilestayingrelativelycloseto Sydney.
**Note:Mix(No.)updatedbasedoninfoprovidedbyagentssincedraftreport **Pricesprovidedbyagent,August2022
Source:StHilliers
MERINDAH,GOSFORD
DeveloperPinnacle
Location25MannStreet,Gosford
CouncilAreaCentralCoast
Location
Characteristics
•300metresfromCentralCoastStadium
•700metresfromGosfordTrainStation
•OverlooksBrisbaneWaterandfrontswalkandcycle ways
Completion2020
ProjectLaunch
DateSeptember2017
StatusCompleted
TotalUnits140
•Mixofluxuryresidentialandcommercialsuites.
•Waterviewsacrossall15floorsofresidentialliving.
1Bed,1Bathroom 1955
$452,000
2Bed,2Bathroom 10681-125$573,000-$770,000
3Bed,2Bathroom 15165$750,000-$1,100,000
Parking 219carspaces,10motorcyclespaces,58bicyclespaces
AncillaryFacilities
Property
Description
•Allapartmentsdesignedtoofferopen-planliving spaces.
GosfordMarketAssessment
Take-upRates
BuyerProfile
Communalopenspace.Landscapedgardenssurroundingtower alongsidelandscapedterraceontheseventhstory.
Throughanalysisofsalesdatawedeterminedforthefirst6 monthsofsalestherewereapproximately6salespermonth. Followedbyayearhiatusinsaleswhichwasfollowedby3per monthfortherestofthesalesperiod.
Marketreportsindicatedthatbuyersderivedprimarilyfromthe CentralCoastandthenorthernsuburbsofSydney.
*BasedonsalesdatafromPricefinderstartingJanuary2021
RECENTSALES
No.TypeSaleDatePrice
6112Bed,2Bath,1Car 05/02/2022$640,000
1013Bed,2Bath,1Car 12/01/2022$750,000
10022Bed,2Bath,1Car 17/12/2021$770,000
2082Bed,2Bath,1Car 11/11/2021$570,000 2052Bed,2Bath,1Car 11/11/2021$655,000
14072Bed,2Bath,2Car 26/10/2021$890,000
6092Bed,2Bath,1Car 23/10/2021$580,000
7013Bed,2Bath,2Car 24/09/2021$860,000
2102Bed,1Bath,1Car 23/09/2021$535,000
Source:Pricefinder
BONYTHONTOWER,GOSFORD
Source:BonythonProperty
Developer
BonythonProperty&Investments(TheJohnSingleton Group)
Location159MannStreet,Gosford
CouncilAreaCentralCoast
Location
Characteristics
•LocatedcentrallyintheGosfordCBD
•300metresfromGosfordTrainStation
•1kmfromGosfordHospital
CompletionJuly2019
ProjectLaunch
DateAugust2017
StatusCompleted
TotalUnits56
•Premiummixofluxuryresidentialandcommercial suites.
Property
Description
•Includes1and2bedroomapartments,andtwo penthouses.
•Thedevelopmentalsohousesagroundfloor restaurantandbar.
1Bed,1Bathroom1863$500,000-$600,000
2Bed,2Bathroom3689-92$575,000-$750,000
Penthouse 2178.5-193$2,000,000
Parking 76carspaces
AncillaryFacilitiesNonespecified.
Take-upRates
BuyerProfile
Throughanalysisofsalesdatawedeterminedtherehadbeen anaveragetakeuprateof4apartmentsamonthforthefirst10 months.Whencontactedtheagentcouldnotprovidetakeup rates.
Sydneypurchaserslookingtorelocate,firsthomebuyers, emptynesters,commuterswhovaluethecloseproximityto Gosford’stransporthub.
*BasedonsalesdatafromRealestate.com.auandPricefinderstartingJanuary2021
RECENTSALES
No.TypeSaleDatePrice
1301Penthouse 07/04/2022$2,000,000
6041Bed,1Bath,1Car23/03/2022$510,000
11052Bed,2Bath,1Car10/12/2021$750,000
10062Bed,1Bath,1Car07/12/2021$590,000
10022Bed,2Bath,1Car19/10/2021$725,000
8062Bed,2Bath,1Car$17/09/2021$575,000 4012Bed,2Bath,1Car11/08/2021$582,500
7012Bed,2Bath,1Car09/08/2021$599,000
11041Bed,1Bath,1Car28/07/2021$520,000
Source:Realestate.com.au,Pricefinder
10/08/2022
CASESTUDYSUMMARY
ProjectSuburbStatusYieldTypeMix(no.)AverageInternalSize^(sq.m)SalesPrices*
Studio1632
1Bed,1Bath5652
$448,000$8,615
HorizonGosfordConstruction174
2Bed,2Bath7087
$530,000$6,092
3Bed,2Bath28107.5$772,000$7,181 Penthouse4170$1,700,000$10,000
Commentary
$342,000$10,688Locatedonthesamestreetas thesubjectsitebutisslightly closertoGosfordHospitaland nearbyschools.Alsosupports 2,500sqmofretail.
Studio137 399,000$10,784
1Bed,1Bathroom453NotProvidedNA
1Bed,1Bathroom+Study1363.3$450,000-$550,000$9,390
PeninsulaPointFrederickConstruction100
2Bed,2Bathroom3489.5$650,000-$980,000$10,973
2Bed,2Bathroom+Study994$835,000-$885,000$9,149
3Bed,2Bathroom36120$950,000$1,450,000 $10,000
3Bed,2Bathroom+ Study/Penthouse3148.5$2,400,000$3,200,000
1Bed,1Bath1456$440,000-$585,000$9,489
Locatedinaquieter residentialarea,relativelyfree fromretailandlarger developments.Thesiteisnear thewaterfront.
TheWaterfront (CentralCoast Quarter) GosfordConstruction136
2Bed,2Bath10384$580,000-$1,000,000$9,759
3Bed,2Bath14120$1,275,000-$1,910,000$11,667
Penthouses,3-4Bed,2-3bath,2car5240$3,200,000$10,583
1Bed,1Bath1955
Stage1ofa3-stagemixed-use precinct.Thetowerhasviews ofBrisbaneWater.
MerindahGosfordCompleted140
BonythonTowerGosfordCompleted56
2Bed,2Bath10681 $573,000$6,700
$452,000$4,757Allapartmentsweredesigned withopenplanlivingspaces, withthebuildingoverlooking thewaterfront.
3Bed,2Bath15165$750,000-$1,100,000$4,533
2Bed,2Bath3690$575,000-$750,000$7333
1Bed,1Bath1863$520,000$8,253Mostcomparabletosubjectsite intermsoflocation,assitesare acrosstheroadfromeach other.However,this developmenthasless apartmentsthanproposedin thesubjectsite.
Penthouse2186$2,000,000$10,753
*SalespricesforcompletedbuildingsarebasedonmostrecentsalesafterJanuary2021
**Wherelistswerenotavailableanindicativeaveragewascalculatedbasedonaverages
^Internalareasexcludebalconiesandcarspaces
Source:Urbis,Pricefinder,RPData,Agentsandrelevantsocialmediapages
LOCALAMENITYANDDEMANDDRIVERS
KeyFindings
Fivekeydriversofdemandforresidential buildingswithintheStudyAreahavebeen identified.
Thefollowingpagesprovideatablethatdescribes thesedriversanddetailstheimplicationsforthe subjectsite.Thesubjectsiteperformshighlyon thesedriverswithstrongaccesstolocalamenity, uniqueaccesstoenvironmentalfeaturessuchas nationalparksandbeachesandreasonable accesstoemployment.
•Amenities,hospitalandschools
•TrainStationandHighway
•BushlandandNationalParks
Surroundingamenity
•Closeaccesstoemploymentcentres
•Views
SourceUrbis
DRIVERSOFRESIDENTIALDEMAND(1/2)
KeyDriversofResidentialDemand
FactorsComponentsImplicationsfortheSubjectSite
1.Highstandardoflocalamenity
Stronglocalamenityintheformof hospitals,schools,shoppingfacilities, recreationalfacilitiesmakealocationmore attractivetoprospectivebuyers.
Shops,Cafes/ Restaurants
OpenSpace/ Recreational Space
Schools
University/TAFE
HealthServices
Stadium
•TheImperialShoppingCentreisthelargestshoppingcentreinthesuburblocated400metres fromthesubjectsite.ErinaFairShoppingCentreisaregionalshoppingcentrelocated6.5km fromthesubjectsite,whichisonlya10-minutedriveduringoffpeaktimes.
•Thesubjectsiteisservicedbyseveralschoolswithina5.0kmdrivingdistanceincluding GosfordPublicSchool(1.6km),HenryKendallHighSchool(1.0km),GosfordHighSchool (2.5km)andStPhillipsChristianSchool(4.4km).
•TheGosfordTAFENSWcampusandNewcastleUniversityCentralCoastClinicalSchoolare 400metresand1.3kmrespectivelyfromthesite.
•ThesubjectsiteiswithinwalkingdistanceoftheGosfordPublicHospitalwhichcompleteda $348millionupgradein2019.GosfordPrivateHospitalis1.7kmviacarfromthesubjectsite.
•Notably,CentralCoaststadiumis300metresawayfromthesubjectsite.Thestadium regularlyhostsprofessionalRugbyLeagueandFootball(Soccer)matches.
2.TransportAccessibilityandInfrastructure
Accesstogoodpublictransportandroad infrastructureareimportanttopotential purchasersandrenters.Particularlyvalued arelinkagestothelocalandSydney employmentcentres.Futureinfrastructure projectscanrevitaliseareas,improve connectivityandlinkages,createnewjobs andreshapetheexistingcommunity.
•GosfordStationislocatedapproximately800metresfromtheSubjectSite.Thisstation operatesontheCentralCoastandHunterlinewhichconnectstotheSydneyandNewcastle CBDs.Itisanapproximately90-minutecommutebetweenGosfordandCentralstations, however,undertheNSWGovernmentFastRailinitiativethiscouldbecutdowntoaslittleas 30minutes.ThedevelopmentlocatedontheCornerofDonnisonandMannStreetswillhave greateraccesstothetrainstationthanothercompetingdevelopments,suchasthePanorama developmentinYoungStreet,WestGosfordorthePeninsuladevelopment,PointFrederick currentlyunderconstruction.
•TheCentralCoastHighwayisimmediatelysouthofthesubjectsiteandconnectstheCentral CoastfromKariongtoDoyalson.
•TheM1Motorwayiswithinwalkingdistanceofthesubjectsite,allowingfastaccessbycarto SydneyorNewcastle.
DRIVERSOFRESIDENTIALDEMAND(2/2)
KeyDriversofResidentialDemand
3.ClosetoNature
Locationsthathavecloseaccesstonature, willbehighlydemandedasresidential locationsbymanybuyers.Thesefactors remainhighontheprioritylistsofthose lookingtorentorbuy.
4.EmploymentOpportunities
NationalParks
Beaches
Waterfront
Residentsoftenprefertoliveclosetowork, enablingthemtominimisetraveltimesand improvework/lifebalance. Localjobs
Hornsby,Epping andChatswood CBD’s
•Thelocationofthesubjectsitewillgiveresidentseasyaccesstothenaturalenvironmentof theCentralCoast.TheGosfordwaterfrontislocated650metresfromtheSubjectSite. BrisbaneWaterNationalParkislocated17.3kmfromtheSubjectSitebyroad.
•ThereareanarrayofbeachesontheCentralCoastwithina15kmdriveoftheSubjectSite. ThepopularTerrigalBeachis11.7km,AvocaBeachis17.2kmandEttalongBeachis15.5 kmaway.
5.Views
Locationswithqualityviewsofnatureare moreattractivetoresidents.
•AsignificantportionofresidentsintheGosfordCBDworkoutsideoftheCentralCoastLGA withmanyregularlycommutingtoSydneyforwork.AccesstoGosfordStationandplanned upgradestotheraillinemeanthatresidentsintheCBDhaveconvenientaccessto employmentcentresinSydney,especiallythoseinHornsby,EppingandChatswood.
•ForresidentsthatworkwithintheLGA,GosfordCBDitselfisasignificantemploymentcentre withretailandcommercialopportunities.TheErinaFairRegionalShoppingCentreislocated nearbywhichincreasesaccesstoemployment
Waterfrontview•ManydevelopmentswithintheGosfordCBDandsurroundingareahaveattractiveviewsof thewaterfront.Thisincreasestheattractivenessofthebuildingforresidentstolivein.The developmenton128-138MannStreetdoesnothaveviewsofthewaterfrontunlikesome competitors,suchasthePeninsulainPointFredrickdevelopment.
SALESCYCLE
KeyFindings
Thenumberofapartmentsalesandthemedian apartmentpricehasbeenassessedoverthe20yearperiodtoNovember2021.
ThemedianunitpriceintheStudyAreahas undergoneasteadyincreaseoverthelast20 yearsreachedahighof$674,256asofNovember 2021.Thisrepresentsanannualaveragegrowth rateof5.4%overthe20years.Thegrowthin apartmentpriceshasbeenhigherforthelastten yearsat6.9%perannum.From2020to2021 therewasayear-on-yearincreaseof$73,692in apartmentsaleprices.However,therecentrisein interestrateswillplacepressureonpricegrowth. ThenumberofapartmentsalesintheStudyArea hasfluctuatedsignificantlyoverthetimeperiod,in linewithapartmentsupplytothemarket.Ithas fluctuatedfromalowof446in2009toahighof 1,050in2018.Therehavebeenanaverageof 692apartmentssalesperyearoverthe20-year period.Overthelastfiveyearstherehasbeenan averageof758apartmentsaleseachyear.
$0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000
ApartmentPriceGrowth(StudyArea),Nov2001–Nov2021
NumberofsalesUnitMedianunitprice
RENTALMARKET
KeyFindings
TheGreaterSydneyareaandtheGosford postcode2250(whichcoversmostoftheStudy Areaandiswherethevastmajorityofapartments arelocated),havebeenanalysedtogivean overviewoftherentalmarket.
Overthelastfiveyearstherehasbeena convergenceinrentalpricesbetweentheGreater SydneyareaandtheGosfordpostcode.Greater Sydneyrentsfortwobedroomapartmentshave decreasedby$30,whilerentsforthreebedroom apartmentshaveincreasedby$10.Gosford postcoderentshaveincreasedforboth2and3 bedroomapartmentsby$110and$80 respectively.Thisindicatesthatfromaprice perspectivetheGosfordmarketisbecoming integratedwiththeSydneymarket,enabling higherrentstobeobtained.
Vacancyrateshavebeenverylowacrossboth GreaterSydneyandGosfordmarketssincethe endoftheCOVID-19pandemicGreaterSydney lockdown.Avacancyrateofbetween2.5%-3.5% representsabalancebetweensupplyanddemand intherentalmarket.Avacancyratehigherthan 3.5%willnormallyleadtodecreasingrents.A vacancyrateofbelow2.5%willleadtoincreasing rents.ThevacancyratesforGreaterSydneyand Gosfordare1.6%and0.6%,respectively,asof June2022accordingtoSQMresearch.These vacancyratesrepresentinadequatesupplyinthe rentalmarketandwillleadtoincreasingrents, particularlyintheGosfordmarket.
Overall,therentalmarketintheGosfordpostcode isextremelytight,withanundersupplyof dwellingsforlocalresidents,whichislikelyto continueintothefuture.
ApartmentRentalGrowth,Sep2017-Mar2022(StudyArea) VacancyRate(StudyArea),Jun2012–Jun2022
Sep-17Nov-17Jan-18Mar-18May-18Jul-18Sep-18Nov-18Jan-19Mar-19May-19Jul-19Sep-19Nov-19Jan-20Mar-20May-20Jul-20Sep-20Nov-20Jan-21Mar-21May-21Jul-21Sep-21Nov-21Jan-22Mar-22
Gosfordpostocde22502BedroomGosfordpostcode22503Bedroom GreaterSydney2BedroomGreaterSydney3Bedroom
Source:NSWDepartmentofCommunitiesandJustice
Source:Urbis,SQMResearch
Gosfordpostcode2250GreaterSydneyEquilibrium
TAKE-UPRATES
KeyFindings
Thetabletotherighthighlightsthetake-upof significantcomparableapartmentprojectsin Gosfordlaunchedinrecentyears.Allofthelisted projectsarecomparabletothedevelopmenton 108DonnisonStreet.
Since2018,theStudyAreahasaveraged203 newapartmentsalesperyear.Newapartment saleshavebeendecreasingsincea2019peakof 440,whichislikelyduetotheimpactofCOVID-19 andthecorrelateddecreaseindwellingapprovals. Apartmentsalesareexpectedtoincreasein comingyearsduetothereopeningofbordersand increasinghousingunaffordabilitypushingbuyers outofSydneymarketsandintotheCentralCoast market.Furthermore,theStudyAreahasstrong andimprovingaccesstoamenitymeaningthere willlikelybestrongdemandforapartmentsinthe areainthefuture.
SalesRatesforProjects
Source:Pricefinder,RealEstateAgents,Urbis *FromSep-2017toMar-2018beforetakinga1-yearhiatusduetoCOVID-19
NewApartmentSales(StudyArea)*
Note*:2021and2022numbersdonotincludeoff-the-plansalesyettosettle. SourceUrbis,Pricefinder
MARKETDEMAND
DemandandMarketShare
ToestimatetheSubjectSitetake-upwefirstlyestimatedthedwellingdemandof theStudyAreaandappliedmarketsharestodeterminetheexpectedtake-uprate oftheSubjectSite.Forthedemandmodelling,itisnotedthatthereis considerableuncertaintyregardingtheeconomicandpropertymarketrecoveryin theaftermathofCovid-19.
CentralCoastLGAMarketDemand
PopulationprojectionsandhouseholdsizeestimatesfortheCentralCoastLGA areprovidedbytheDepartmentofPlanningandEnvironment(DPE)andadjusted byUrbis.
FromtheseprojectionswecandeterminethedwellingdemandfortheLGAwhich istheadditionalpopulationgrowthinayeardividedbythehouseholdsize projections.Inlinewithrecenttrends,apartmentshaveaccountedfor approximately30%ofnewdwellingsintheLGA.Thispercentagerepresentsthe fiveyearaverageofapartmentcompletionsintheStudyArea.Thisisprojectedto increaseto36.0%asof2034asgreenfieldlandsupplybecomesmorelimitedin thearea.
StudyAreaMarketDemand
TheStudyAreaislikelytoreceiveahighproportionofapartmentswithinthe LGA,withonaverage90%ofapartmentcompletions,withintheStudyArea.This isprojectedtodecreaseto85%asof2034asotherareascontinuedtogrowtheir portionofapartmentdevelopments.Basedonthisapproximately562apartments willbedemandedwithintheStudyAreainFY2023,increasingto702byFY2034.
MarketShareAnalysis
Throughanassessmentofthecharacteristicsofthesubjectsiteandcompetition, wehavedeterminedthatthebasemarketshareofaround16%isfeasible.This marketshareisbasedonthefollowing:
•ThesubjectsiteisclosetoGosfordTrainstation,closerthanothercompeting developmentsgivingitacompetitiveedge.Thesubjectsiteislocatedashort walkawayfromtheImperialCentreandotherretaildestinations.Thisiscloser thensomeothercompetingdevelopmentssuchasthePeninsuladevelopment inPointFrederick.Thereforethesubjectsitehasaboveaveragecompetitive positioning.
•TherearesixapartmentdevelopmentsinthepipelinewithintheStudyArea thathave200ormoreunits.Thesubjectsitewould,therefore,havearounda 16%shareofthismarket.However,thispipelinerepresentsalikelybest-case scenariowithactualcompletionsdependentonmarketconditionsand developersaccesstofinanceandabilitytopre-sellapartmentsaswellas competitionfromsmallerdevelopments.
•Duetothebetterrelativepositionofthesubjectsitetothesecompetitors,a highcasemarketshareof20%hasbeenadopted.
SubjectSiteMarketDemand
Basedonthemarketshareofbetween16-20%,annualtake-upforthesiteis projectedtoequatetobetween89-108apartmentsinFY2025,increasingto116140byFY2034.
PROJECTEDNETTAKE-UP
RECOMMENDATIONS
Demand
Thetable(right)outlinestherecommendedmixandindicativepricing($2022) forthesubjectsite.
Mix
Therecommendationisthatthedevelopmentconsistsmainlyoftwo-bedroom apartments.Thisisattractivetoinvestors,familiesandyoungprofessionals movingfromSydneytotheCentralCoast.Two-bedroomapartmentsshould accountforapproximately60-70%ofthemix,astheseapartmentsareattractive toinvestorsandfirst-homebuyersinthemarket.Havingmostapartmentseither 1-2bedroomswillbeappropriateconsideringthelow,anddecreasing, householdsizeintheStudyArea.Threebedroomsshouldmakeup10-15%of themix,withinvestorsandfirsthomebuyerslookingforamoreaffordable optionintheCentralCoastmarket.Itisrecommendedthatnofourbedroomor penthouseapartmentsareincludedduetothelackofwaterfrontviewsprovided bythesubjectsite.
Size
Therecommendedinternalsizesarebasedonacomparisonwithrecent projects.Theyconsiderthedesireformorespaciousaccommodationinthearea (comparedtoSydney),thoughmaintainingaffordability.
Prices
Pricingapartmentsisdifficultinthecurrentenvironmentwithinterestratesand constructioncostsontherise.Therefore,itisuncertainiffutureoff-the-plan saleswillbeabletomatchthesalepricesachievedinourcasestudies.The pricesprovidedareindicativeanddependentonmanyfactors.
Theprojectedsalespricesin$2022havebeenestimatedbasedonrecentoffthe-planpricesandnewapartmentre-salesinthearea.Itisimportantthatthe pricesreflectthebalanceofaffordabilityandluxurythatisappropriateforthe CentralCoastmarket.
RecommendedMixandPricing
1Bed,1Car15-25%50-60$450,000-$550,000
2Bed,2Bath,1Car60-70%70-80$600,000-$710,000
3Bed,2Bath1-2Car10-15%100-120$850,000-$1,050,000
SourceUrbis
Take-up
Basedonhistoricalandprojecteddemandandcompetition,theSubjectSitecould achieveasalesrateofaround55-65peryear(about5permonth)in2023.These ratesaresubjecttoconsiderableuncertaintywithinterestratesrisingandproperty pricesexpectedtodecrease.However,consideringtherecordlowvacancyratein theStudyArea,thereisconsiderableundersupplyinthemarketcurrently.This meanswithoutasignificantdeteriorationinthemarketthesubjectsiteshouldbe abletoachievetheforecasttake-uprates.
APARTMENTFUTURESUPPLYPIPELINE(50+APARTMENTSONLY)
PacificaGosford136-148DonnisonStreetGosford2026DevelopmentApproval727 WatersideDevelopment50-70MannStreet&141GeorgianaTerraceGosford2025DevelopmentApproval500
SchmidtNorthGosfordGateway Development 35-37,41ADwyerStreet&372-374&393-397MannStreetNorthGosford2028Development
Source:Urbis,CordellConnect
ProjectName
PeninsulaPointFrederick 8-10DukeStreet,177-179 AlbanyStreet&2-4Auburn Street PointFrederick 2023 UnderConstruction101
KeeversLane&BeaneStreet MixedDevelopment 2KeeversLane&43-45Beane Street Gosford 2024 Development Application98
JohnWhiteway&HenryParry DrivesApartments-The Waterview 86JohnWhiteway&79-87HenryParryDrivesGosford2023UnderConstruction96
HillsStreetApartments34-44HillsStreetNorthGosford2024DevelopmentApproval85
JohnWhitewayDriveApartments -MarquesResidences70JohnWhitewayDriveGosford2025DevelopmentApproval72
BentStreetUnits7-11BentStreetGosford 2026 Development Application69
OrmondStreetApartments15-21OrmondStreetNorthGosford2025DevelopmentApproval64
OrmondStreetNorthGosford Units 5-13AOrmondStreetNorthGosford 2022 UnderConstruction61
HillsStreetResidentialBuilding59-61HillsStreetNorthGosford2026DevelopmentApplication61
MannStreetMixedUse DevelopmentSite297MannStreetGosford2025EarlyPlanning60
Ormond&GertrudeStUnitsSarah'SPlace 10-14Ormond&195GertrudeStreetsNorthGosford2024DevelopmentApproval59
RangeRdUnits18-22RangeRoadNorthGosford2023UnderConstruction57
TheGrange73-77EtnaStreetGosford2024DevelopmentApproval55
GertrudeStreetUnits-TheMint Gosford 181-183GertrudeStreetGosford 2025 DevelopmentApproval54
JabiruEttalongBeach237-245OceanViewRoadEttalongBeach2023UnderConstruction52
Source:Urbis,CordellConnect
