Brisbane is a prime choice for offshore investors looking to develop property. How is this activity impacting the region's economic growth?
With the Brisbane City Council's economic plan revealing intentions to transform the area into a leading 'new world city', we can expect bright things to come in the years ahead.
Already, the economy has grown an astounding 60 per cent from 2000-01 to 2010-2011, the city council's plan noted. With opportunities abounding for exporting agricultural and other products to a hungry APAC market, as well as a healthy tourism sector and knowledge economy, the greater Brisbane area is an attractive option for investors both home and abroad.
Foreign investors are paying attention to these trends, seizing opportunities to get in the market while the conditions are right. What exactly is the impact of this offshore activity, and what is our best response?
Offshore investment: Laying a strong foundation
Urban renewal, precinct development, major infrastructure upgrades: These are all signs of Brisbane's strong economic growth.
Brisbane is different to most areas in Australia. When you look at the number of developments that are currently underway, it's clear that Brisbane is booming.
"The Gold Coast is going very well. Every week a new development appears. The upcoming Commonwealth Games is helping the boom for the Gold Coast. For example, Sheraton Gold Coast was just sold to a Singapore businessman for $160 million."
Foreign investment in property is a strong impetus for this economic development. Although some people may be concerned that this activity is driving up the price of real estate across Queensland and Australia, the bigger impact is much more positive.
Offshore investment is helping drive the growth in jobs in the property and construction sector. Given the number of developments happening around southeast Queensland we need these foreign buyers, especially since job security continues to be an issue for Australians. Because citizens are concerned about over-investing, we need offshore investors. That way, our economy continues to expand, providing that job security and fueling ongoing growth.
Attracting the interest of overseas investors
Why do investors turn towards Australia? Often it comes down to better returns than they could get at home. Although these rates might be lower than they were a few years ago, we're still ahead of many other countries - and that's something we should use to our advantage.
Current activity is focused heavily on residential property development, but there's plenty going on in the Queensland economy to continue attracting investment.
Recent years have seen a heavy emphasis on student accommodation investment, but I think we'll be reaching our limit here shortly. I think aged care and agribusiness will be the next big opportunities for Brisbane to attract investment. Overseas investors should look not at the now but at what needs to happen in the next 10 years. Aged care is also poised for rapid growth.
Offshore investment in agriculture and other areas could help catalyst Queensland's economic growth, adding to local businesses' efforts to transform Brisbane's into the modern regional epicentre it aims to be.