New investment opportunity

urban cowboy

urban cowboy

Hi all,

Sailesh Channan and I have been successful in attracting the construction and marketing rights to a new development in Joyner in Brisbane's North. We would like to offer the product here for both the scrutiny of our fellow SS'ers and for any interest there may be from investors currently in the market.

I am also interested in hearing from any of the agents/marketers/investment managers/fin planners etc. who wish to talk from a marketing and sales perspective.

Michael Matusik and Heron Todd White have been heavily involved in the pricing and related research in terms of design and placing the development in the marketplace. In this regard, we are confident of providing a well priced, unique product to the Brisbane area (and possibly unique to the country).

Please feel free to ask questions here or send an email to [email protected]

A website with basic details has been launched by the developer at http://www.onemilecountryclub.com.au/ please note that some of the details here will change and the site redesigned in the near future. There are site plans and artists impressions there though!!


-------------------------------

What is the development???
First of all, the locale -Joyner is a semi-rural/acreage suburb on Brisbane’s northern fringe – It is minutes to the commercial hub of Strathpine and surrounded by infrastructure including transport, schools, and recreational facilities and shopping. The boom suburb of Warner is right next door and the nearby Warner Lakes estate has seen rapid expansion over the last three years and is still only 30% complete. The local industrial estate of Brendale is also going through a multi-billion dollar expansion which will require large numbers of dwellings to be constructed in the coming years.


The MyRP suburb profile for Joyner is here
The MyRP suburb profile for Warner is here
The MyRP suburb profile for Brendale is here


The short facts:
104 town houses, 4 separate designs within the confines of a boutique 9-hole golf course.
3 heated pools, tennis court, BBQ facilities, children’s play equipment and common areas within the complex.
Gated secure community with high speed fibre optics, water treatment facility and private & discounted access to the course.
Leasehold property – 99yr automatically renewed upon transfer
Each residence has its own 28,000litre water tank.
Abundance of walking trails within the immediate area through nature reserves and along the River


Marketing information:

One Mile Golf Course is a quality boutique nine-hole golf course situated on Young’s Crossing Road at Joyner on the north side of Brisbane, adjacent to the prestige estate of Petrie-on-Pine and is privately owned.

One Mile Country Club is a planned development which will be incorporated within the bounds of One Mile Golf Course, consisting largely of 104 high quality town house units and amenities. There will be four individual town house designs comprising two bedrooms with lock-up garage and buggy store. Most will have a view of the golf course and its waterways.

Extreme care has been taken not to interfere with the ecology of the area and residents are encouraged to enjoy our wildlife which includes many species of waterfowl, native birds and koalas on the golf course and adjacent properties. Residents are also encouraged to make use of the facilities provided as well as the golf course, walking trails and bikeways adjacent to the community.

One Mile Country Club is not a retirement village. Quite the contrary. It has been designed to provide a quality residence for those who are looking to downsize from the traditional all consuming residential property and have the time do the things they have always wanted to do.

The contemporary town houses have been architecturally designed with comfort in mind. They are air-conditioned and offer the very latest in electronic communication systems available enabling access to pay TV as well as free to air and the choice of internet providers.

Modern European appliances have been chosen for the gourmet kitchen along with the very latest in fixtures and fittings throughout the home.

All town houses have two bedrooms plus study. The master bedroom has an en-suite bathroom. There is a main bathroom upstairs with toilet and a third toilet provided on the lower level.

Quality floor coverings are also included throughout.

The landscaped area around the home will be maintained by our ground staff, however keen gardeners will be encouraged to participate.

A waste water treatment plant is incorporated in the development and produces water of the highest quality. This plant is licensed by the Environmental Protection Agency and its product is used mainly to augment the irrigation system of the golf course, our most valuable asset.

Resident’s peace of mind has considered in the design of the precinct and a full height security fence will surround the development. Electronically controlled gates can be opened from the town house to allow guests to enter and residents will have their own personal security card to use when leaving or coming home.

A full size tennis court, heated swimming pools and several barbeques have been provided for and are available free of charge to residents and their guests. Children’s playgrounds are located close to the barbeques and amenities. The staff of One Mile Country Club will maintain these facilities as well as the grounds in general.

Access to our beautiful and challenging nine hole golf course is available to residents and their guests at concessional rates. Walking trails and bikeways have been designed around the precinct and these connect with a huge network of municipal pathways leading to local facilities as well as remote areas where you can take in the natural wonders of Australian fauna and flora.

Dedicated car wash facilities are planned. High pressure/low volume car washing hoses will be available at undercover sections of the car parking area. This facility is also free of charge.

A modern two story clubhouse is planned and resident’s interests were considered in its design. Incorporated in the clubhouse will be a bar/bistro, pro shop, and generous recreational areas. Construction of the clubhouse will commence along with stage one of the town house units and completion is expected during stage two.

Security for residents has been a major consideration in the design of the project. The grounds surrounding the town house units will be protected by security fencing and gate access will be for authorised traffic only.

Also incorporated in the design is a fully integrated water management system whereby the primary source of water is through the harvesting and storage of rainwater. Each town house unit has its own 30,000 litre underground concrete tank built in conjunction within the unit. Potable water supplied by Pine Rivers Shire Council will be supplied to the kitchen sink. An independent waste treatment plant is included in the water management system and provides for the irrigation of the golf course and integral landscaping.

Landscaped areas surrounding the town house units are fully maintained by greenkeepers employed by the golf course.

The first stage pricing and availability are as follows:

(see omcc website posted above for designs listed below)

Unit No. - style - size m2 - Price

1 The Augusta - 205.9 $495,000
2 The Augusta - 205.9 $499,000
3 The Augusta - 205.9 $505,000
4 The Augusta - 205.9 $505,000
5 The Augusta - 205.9 $520,000
6 The Augusta - 205.9 $520,000
7 The Augusta - 205.9 $525,000
8 The Augusta - 205.9 $535,000
9 The Royal Troon - 180.6 $375000
10 The Royal Troon - 180.6 $375000
11 The Royal Troon - 180.6 under contract
12 The Royal Troon - 180.6 $375000
13 The Royal Troon - 180.6 $395000


Over to you fine folks for your comments!!:D


Cheers
UC:)
 
you are a brave man gundadin
to be going into golf club housing
have a look at twin creeks and from there see the guys that have been doing it for some time and they have a few problems
there is not alot that is new to developing the only thing is the margins
and ways people try to get a margin in that will be good enough for a lender.
as a rule you dont get alot of renters in these type of property so it a buy stay and live
thats not an investor place for me.
I need to be able to
hold
sell at a profit if I have to
and liqudiate without a loss
and these don't cover any of the three
tehre is alot better deals in the market if you look.
not to knock your postbut I know alot that are in this market or that market
and tehy are selling at around 65 to 75% of val and still no bites
so trying to presale and make money is avery big ask
but if you never try you will never win
hope you well
 
Thanks GR - love your directness and honesty as usual!!

The owners are wanting a fair proportion of owner occupiers - and yes i think that will be a good chunk of the market for these, however golf course developments have traditionally worked reasonably well in Qld - think Hope Island Resort, Arundel, Brookwater etc.

This admittedly is significantly different given it is not targeted at the high end like those are, but is still unique given the eco-friendly angle and the views etc. The course is also a public course - so no memberships like the big developments.

As for resales - i completely understand your position - I guess my answer to that without trying to look like i am talking you into something is that right now they are being sold at the 2006 pricing. Once the first few are gone, i expect these prices to rise significantly as both HTW and Matusik's are doing more research into current pricing now.

There is also a large demand for town house developments in the area - this just puts a new slant on the traditional large scale community.

The pre-sale is really just for the first couple and not necessarily to make a big profit from - as once construction starts (hopefully in the coming weeks) we know that they will self generate interest as we will have displays etc. too - activity breeds activity!!:p

thanks again for your point of view GR - always welcome!!

cheers
UC
 
Hi UC, How does :

- a 99 year lease effect my ability to get a loan and benefit from capital gain
- use capital gains as equity on another property?
- move and rent 'my' property to someone else?
- which entity is responsible for maintenance of common facilities, especially if full sales are never achieved?
- which entity is responsible for maintaining the property I lease?

Why is the developer doing leasehold?
 
WinstonWolfe said:
Hi UC, How does :

- a 99 year lease effect my ability to get a loan and benefit from capital gain
- use capital gains as equity on another property?
- move and rent 'my' property to someone else?
- which entity is responsible for maintenance of common facilities, especially if full sales are never achieved?
- which entity is responsible for maintaining the property I lease?

Why is the developer doing leasehold?
Click to expand...

Heya WW!!

will answer these in order...

According to the brokers i have spoken to (and one of the owners who is high up in one of the majors) - the loan should be no different from a normal purchase.

to go from an owner occupier to investment is no problem - same as any other property.

A sublease is allowed for upon application (you have to apply to the management comittee, but no problems as long as the sublease also complies with the original lease conditions)

The management are responsible for all maintenance and repairs - the golf course staff perform all the relevant duties here - full sales not required because the common property is owned by the course and not the residents - hence the course is responsible for it all.

Not sure what you mean by which entity responsible for property you lease, but to have a go - as per a standard multi residence property...internally it is your problem and the outside and construction issues rest with the Management (the Course in other words) as you would normally expect with say a body corp'd or managed development.

The developer was required to go leasehold due to the on site water treatment works. Council and the EPA won't allow 104 owners of a water treatment plant...SO the developers have been forced to retain "ownership" of the entire development so they can own the water treatment system and all its inflows etc. and are selling the properties as leasehold. Similar to the ACT and some mining towns.

The lease has been designed as the 99yr renewable lease to bridge the perceived gap between freehold and leasehold. From a titles perspective the only difference is that instead of the owners name being registered on the title - the owners name is registered as holding the lease over the title. Same rights and obligations generally apply.

hope this answers it ok??

cheers mate!
UC:)
 
Thanks Grant.

I haven't had experience with leasehold before.
I am unclear how leasehold effects capital gains and a lender's propensity to allow a LOC against it.
 
WinstonWolfe said:
Hi UC, How does :

- a 99 year lease effect my ability to get a loan and benefit from capital gain
- use capital gains as equity on another property?
Click to expand...

Lenders will want to make sure the loan is paid to zero before the end of the lease. If the lease has 26 years to run, they'll give you a 25 year loan term but not a 30 year term.

They're not going to have a problem with a 99 year lease for accessing capital gains, but keep in mind that towards the end of the lease the type of lease may adversely affect the capital gains.
 
no probs Winston! you know I'm always happy to try and answer your questions!! hehe :p

Thanks for the info Peter...what do you mean by the type of lease? what do I need to be aware of there??

the lease in place automatically renews at the end of 99yrs or upon transfer of ownership of the lease - i.e. if i am ten years into the lease and sell the property, the new owner gets a 99yr lease (not 89 etc.).
 
We had picnics as kids at Youngs Crossing.

I notice in the FAQs that the property is resold through the company, who charges a 10% selling fee - around $37K - $53K on CURRENT advertised prices.

Surely this is excessive.

Is an owner allowed to sell through a chosen RE agent?
Marg
 
Hi Marg,

yeah I remember picnics in the area when up on holidays many years ago - beautiful part of town!!

I admittedly baulked at the 10% initially as well - but upon explanation it makes some sense. The ten percent sales levy includes all the costs of disposal of the premises and covers the costs of refurbishment prior to handover etc. as well as all marketing and sales fees and commissions. As you are probably aware, a full interior repaint is not cheap and then there is carpets and the like as necessary too.

To my current understanding, the management orchestrates any future resales with the assistance of local agents where required - the 10% includes any agents fees (currently ~2.5% in QLD) that may occur. SO, whilst the sales are organised by the developer, you may suggest an agent of choice to assist in the process.

This setup is not uncommon - particularly in managed resort developments and retirement/over 55's villages. A percentage of sales price is usuall charged so that once the owner moves on, the developer can go in and upgrade/update the property to ensure its "freshness"to the market etc.

does that make sense??

thanks for your feedback Marg!! appreciate it...

cheers
UC:)
 
Hi UC

Still seems exhorbitant to me.

Say I buy in, look after my place well, and it is still close to pristine in 3 years when I have to sell. In this case 10% IS excessive. Or, even worse, an emergency sale after 12 months. Surely re-painting, re-carpeting and refurbishing in these cases is at odds with the eco-friendly promotion of the complex and, in most cases, entirely unnecessary.

Sounds to me like an exit fee by another name.....
Marg
 
Yep - fair call...

I will suss that one out a bit and get some more info!

I take your point well and I guess in the absence of further information I can only refer back to my earlier remark about it being common in large managed developments - but be assured I will check it out further and raise it directly with the developers!!

cheers
UC:)
 
Hey aaarghhh...

we new about Comisky, not sure about the smaller one...Comisky backs onto the course from the other side.

I don't think either of those will affect us at all - in fact we may be helping them longer term by setting sales benchmarks etc.

We are ready to go now, Comisky would be at least 12 months away and the construction timeframes on something that large will be years.

The other one has just asked for a change of approval - so that will get tied up for a year or so. By then we will be half built.

I take your point though and credit your knowledge of the area - that's awesome!!

Comisky is not a direct competitor due to it being such a large estate and there only being a small medium density component. The other site will be intersting but as far as i can gauge their units are a lot smaller and in more of a traditional complex configuration. One of their requests to change is to add gates etc... maybe they are watching what we are doing??:p

cheers again
UC:)
 
To be fair, my main objection to the idea of the 10% selling fee is that the site says clearly that there is no exit fee, then whacks on a selling fee, which is really quibbling with words.

I think it would be less annoying if the marketing statements were re-worded to somehow combine the two - a sort of exit-refurbishment-selling all-inclusive charge.

That way you are acknowledging exit costs even if you don't want to call it an exit fee, but explaining what is included.

I know where you are coming from as hubby's father has a freehold strata unit in a retirement complex. When he comes to sell he has a maximum 10% exit fee, plus he will be up for his chosen agent's commission. I know the complex set-ups are entirely different, but your selling fee strategy is more economical and should be promoted accordingly.

It's just that most people get their backs up if they feel they are being misled. "Weasel words" is a favourite media term for this.
Marg
 
and fair that is...that's for the clarification - you make an exceptional point and will definitely take up your message with the developer. Having re-read the part you refer to, I agree the section can be reworded to better reflect the intent of what they are trying to achieve.

Weasel words - great in some instances - lousy in marketing!! hehe

Thankyou so much Marg for going to all that effort.

UC:)
 
No disrespect meant but 99 yr lease, subleases and 10% sale fee sounds all too hard to me with a loss of control. I don't play golf anyway. Best of luck though.
 
no disrespect taken :)

I posted here to get all opinions and to help me fine tune any issues - all comments are welcome!

the way the 99yr lease has been written, it is almost identical to a freehold property...no loss of rights and full control over the town house as you would on any other freehold townhouse.

the sublease issue was a response to a specific question - the answer is no different to you owning a property, renting it out, then having the tenant approach you to sub-rent it again.

10%, well, as i said i need to work on that one with the owners so won't go anywhere with that until i have firmer instructions.

There is no loss of control here - the rights and obligations are almost identical - the only real difference is you don't pay rates - the course does. All other rights and obligations you have under normal freehold arrangements are present in this scenario too. Same as you find in the ACT and mining towns like Mt Isa etc. also many retirement villages and highrise resorts.

I am not much of a golfer either, but i reckon that's about to change! :p
 
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