Q&A with Neville Smith
Q. Townsville is the capital of northern Australia and is currently seeing a surge. In your opinion, what other sectors do you believe are on the rise?
A. “We’re seeing rapid residential growth in Townsville, which in turn means there are education, medical and allied health facilities also being delivered. The market for new essential service assets in Townsville is huge.”
Q. How has Townsville’s market been affected during Covid?
A. “Fortunately, Townsville wasn’t impacted by COVID-19 as many other regions were. We live in a tropical environment and humidity became one of our biggest defence mechanisms. Don’t get me wrong we have seen many businesses down for a short period and like the rest of the country, tourism and hospitality struggled immensely but thankfully the city wasn’t grounded for the best part of 2 years like others. Now we just have to focus on how we get these two important pieces of the economy back up and going, so plenty of eating out and holidays to come… what a conundrum!”
Q. What makes regional commercial real estate a safe investment?
A. “It’s the diversity in our economy underpinned with the major government backing why many look at Townsville as their next investment area outside of South East Queensland.”
Q. How many of your investors are from Townsville, or Far North Queensland?
A. “There is a significant portion of investors within a 2.5 hour radius of Townsville as there is many established farming families that believed in the city. Over time this has changed slightly with major national investment groups getting in on the action and owner occupiers securing their facilities.”
Q. What attracts metro-focused buyers to make the change to a regional asset?
A. “It was always yield-driven but as the city has grown yields have tightened to get closer to metro areas.”
Q. What’s the most interesting regional asset you’ve sold or come across?
A. “There have been several interesting assets but a standout to me would be the Holiday Inn aka ‘The Sugar Shaker’.Known for its unique cylindrical shape, The Sugar Shaker is the largest CBD hotel in Townsville. It was an asset class that broadened my career’s exposure internationally.”
Q. What makes regional real estate unique?
A. “Regional real estate is unique because of a combination of the local environment and the people. The catchments provide a loyal customer base, which in turn underpins land value and investor certainty.”