Michael Hurley on the growing demand lifestyle focussed properties.

Our CEO Kirsty Chessher-Brown interviewed Michael Hurley, Residential Manager at Aria Property Group on the growing demand from owner occupiers for well-designed, lifestyle focussed properties.

Michael Hurley, Residential Manager at Aria Property Group

2021 hasn’t been the smooth ride we were all hoping for on a COVID front, but the property market has been a shining economic light.  What are you seeing on the ground?  Who’s buying?

Conditions are quite good. We currently see this as being a continuation of a flight to quality, and whilst property seems to be hot right now, people are also still quite discerning. People care about the quality, the developer’s track record and reputation.

Owner occupiers have been a growing sector of the market and at one stage we did have a 70% investor / 30% owner occupier split, but now it’s 50/50 and heading towards an owner occupier majority. The feedback we get over and over is that people want more than just an apartment they want the amenities, quality, and services that go along with it. The owner occupiers want all the bells and whistles, whether it be the day spas or the fitness centres or the private dining rooms or roof top spaces. We are seeing a lot of downsizers as well, along with people moving from interstate, and there is also clearly a coastal lifestyle shift. At Aria we focus primarily on Brisbane, although we are gearing up to do a large project at Mooloolaba that we have been planning for a very long time. The demand for well-designed, high quality owner occupier focused product on both the Sunshine Coast and ‘Southern’ Gold Coast is very strong, and some of the revenues being achieved are mindboggling.

While we’re not ‘post-COVID’ quite yet, what long lasting impacts do you think the pandemic will have on the way we deliver spaces, places and homes?

We feel that COVID will really push an increased focus towards liveability. Lockdowns are still at the forefront of people’s minds and if you’ve lived in a shoe box with no natural light, low ceiling heights, a terrible study desk, and token amenities; and you’ve had to stay there for an extended period of time, it’s likely you’re not that happy, and planning to make a move. We think apartments are probably going to be a little bit larger moving forward as a result.  Things like better natural light, crossflow ventilation, well designed study areas and working from home options are going to be in demand. This pandemic has cast an even larger light on the health and wellness side of the world and living. We’ve always been big into that space, and it’s been incredibly well received and if anything, we’re going to double down on that even more. That includes everything from hot and cold pools, infrared light saunas, dry saunas, steam rooms, Pilates and yoga rooms, fitness centres with real gyms and multiple cardio options.

What is the greatest challenge you are currently facing as a business in getting stock to market in Queensland?

Getting stock to market is constrained by two things that I think everyone can attest to, and that’s approval timelines and construction prices. Councils have been inundated with applications, including those related to renovations and that has really bogged the system down. There are also resourcing challenges where many council planners have moved to private firms, which is resulting in further delays.   

In relation to construction prices, everyone is experiencing material cost increases, supply shortages and price escalation due to a shortage of trades. It’s not uncommon for constructions numbers like for like to be 35% + more than this time last year, if you can even get a price. Yet ultimately it comes back to relationships, track record, and risk. The relationship of the developer with the builder and in turn the relationship of the builder with their subcontractors is key.  

Thinking ahead to the next 12 months, what is your prediction on how the property market will perform and are there any potential showstoppers?

Money is still cheap and there is quite a lot of it in the system, along with interstate migration over the next 12 months from all reports continuing at record pace. So, we don’t see anything out there right now that suggests it’s going to slow down anytime soon in Brisbane. The rest of SEQ is anyone’s guess. But I think, like everything, if you have a proven track record, understand your market and you have a really good product, I think you’re going to do well.

With a Federal election likely on or before the first half of 2022, what are the critical issues from a property industry perspective that you’d like to see discussed during the campaign?

I think overall, they’re doing a really good job, but the property industry is, and always has been an easy target for government taxation. They need to be careful to keep things in check, because there are already so many different taxes that we’re already getting hit with, that we just don’t want them to add more.

The other thing that Aria is passionate about is sustainability and how can we make our buildings and developments more environmentally sustainable. From a government perspective whether it be local planning, state or federal, I think having a framework around incentivising and encouraging more sustainable developments would be a good thing. You just need to look at Singapore as a great example that if the government correctly legislates and incentivises the development industry to focus on design, sustainability, and public realm, great things can and will happen. Alternatively, if the state and local governments don’t make any changes, most developers will default to just doing what they’ve been doing forever, which clearly isn’t a great community or sustainability outcome.