CBRE & Wingate 2018 Private Client Lunch
While the residential market faced numerous headwinds, not the least from the Hayne Royal Commission’s impact on the availability of housing finance, there remained real opportunities in the market, according to Melbourne developer, Tim Gurner.
Speaking at the sixth annual CBRE & Wingate client luncheon at Crown, Mr Gurner told the 450 attendees that there was no doubt the Royal Commission had inadvertently hurt the industry but there were always pockets of the market that would outperform others.
“There is no doubt that the residential market is not performing as well as it had been in recent years and there are a number of factors at play that I think we are all well aware of.
“Having said that there are still parts of the residential market that are performing really well. If we had 30 apartments in Elwood they would sell in a week,” Mr Gurner said.
Mr Gurner was one of six speakers at the lunch – now one of Victoria’s leading commercial property events – which also included John Preece from Hub Australia, Michelle McNally from Australia Post, Chris Key from Greystar, Paul Fell from Pamoja Capital, and Rob Anderson from Shakespeare Property Group.
CBRE National Director Investments, Mark Wizel, who hosted the event with Wingate Managing Director Property, Mark Harrison, agreed there was still upside in the residential sector.
“The residential market is not one homogenous whole, rather it comprises a number of sectors which respond in different ways to the economic climate of the day. The prestige market, for example, is one which appears immune to the sort of economic conditions which might spell trouble for others, and similarly, boutique style apartment blocks in the best locations will always do well,” Mr Wizel said.
Mr Fell said there was also a positive residential story to tell about Melbourne’s student housing market.
“Melbourne has attracted many institutional players with strong international reputations and will continue to do so while yields are strong. Couple that with the support of the universities and that’s a great story for developing student accommodation,” Mr Fell said.
Preece confident on co-working
On co-working Mr Preece told the audience he was very confident in the future of co-working and not simply because it had worked in the US.
“Tenants like co-work space because it offers good quality accommodation and flexibility that can’t be found in the B or C grade office markets, while it’s also important for smaller firms who are trying to attract and retain quality young graduates to their businesses,” Mr Preece said.
Mr Anderson agreed that co-working was here to stay, and while the easier answer for office owners was to favour the traditional tenant such as a law firm, co-working had grown to now command 150,000 square metres of space or 3 per cent of the market.
Mr Harrison said the collaborative event with CBRE had been a real success story for both organisations in showcasing their expertise to an audience comprising a significant cohort of Melbourne property’s key players.
“It started with 200 people in Crown’s River Room five years ago and has since become one of Victoria’s leading commercial property events and that’s something we’re very proud of,” Mr Harrison said.