adelaide, australia · entertainment options. with south australia being known as the festival...

2

Adelaide is one of the best cities in the world to live, work, do business and invest. It offers the ideal combination of quality of life, convenient location, efficient public transport, world-class infrastructure and proactive government support for business.- City of Adelaide

“

”

Glenelg

3

Joseph Chou Founder and CEO

From the CEO

For more than a decade, we have helped people invest in Australia’s 5 major capital city markets – each of which has an established history of liveability and consistent long term property performance. However, investors everywhere commonly express how difficult it is to understand and have confidence in their own “home city” market from an objective investor’s point of view, let alone a city in another state. And without confidence, it inevitably becomes more difficult for people to take action – whether investing in another city or the city where they live.

Our Research team has produced this My City report to better inform investors about the fundamentals and drivers of the local market. This report condenses the relevant and important information that property investors need with a specific focus on lifestyle, population, demographics, infrastructure, employment, transport, education and market performance. We hope it helps you better understand the market and the long term opportunity that this city presents to investors.

Our Property Strategists and support teams look forward to helping you build your future property investment success story through utilising our Portfolio Approach and other Ironfish tools and resources.

All the best for your journey!

4

Grant Ryan Property Director

From the Property DirectorWith a reputation for creativity, sustainability, and world-class food and wine – it’s easy to understand why Adelaide is considered one of the world’s most liveable cities.

Adelaide is now becoming a city fuelled by innovation. In recent times, we have seen the city quickly establish itself as the nation’s high-technology hub, with many now billing the city as Australia’s unequivocal leader in ‘green infrastructure.’ This positive momentum has placed Adelaide on an exciting trajectory to become Australia’s own version of ‘San Francisco.’ In addition, Adelaide’s lifestyle and affordability drivers will continue to attract international and interstate migrants. This is great news for investors and makes Adelaide a city to watch.

I hope you enjoy learning more about this great city.

5

From the CEOFrom the Property DirectorLiving in AdelaidePopulationDemographicsInfrastructureEmploymentTransportEducationHousing MarketApartment MarketSources

Contents

3468

1112161821222426

6

Living in Adelaide“Adelaide has a vibrant city landscape which is rich in experiences. It offers residents and workers the best of both worlds: convenient, cosmopolitan urban development and familiar, family-friendly home-style comforts.” - City of Adelaide

Lower Cost of Living

Adelaide is ranked 5th in the world for liveability, with strong results across health care, culture, environment and infrastructure. Known for its food, wine and festival culture, Adelaide continues to attract residents and tourists from the world over.

With all its appeal, Adelaide still remains the most affordable of all major capital cities with median house values of $442,000 and median apartment values of $348,245. At current prices, Adelaide property is less than half the cost of Sydney.

In addition, according to the Cost of Living Index, Adelaide enjoys a lower overall cost of living compared to other major cities. This makes Adelaide an attractive option for investors and new migrants

Arts, Culture, Festivals and Sport

Adelaide is widely recognised for the vibrancy of its arts, culture, festivals and sports. The city is lively and energetic containing a wide array of entertainment options. With South Australia being known as the Festival State, Adelaide features festivals for everyone, whether it be art, film, literature, cabaret, food or wine.

Additionally, sports play an important role in community life for Adelaideans, with South Australia recording the second highest rate of sporting event attendance of all states and territories, according to a study by the ABS. Major sporting events include Tour Down Under, Clipsal 500, Adelaide Cup, and International Cricket series – with the most popular sports being Australian Rules football, motor sports, horse racing, cricket and soccer.

The 20 Minute City

Adelaide is known for being the ‘20 Minute City’ because of its superior urban design and roads network, which makes it very easy to get around. The excellent roads network also mean less traffic and congestion, making for a more relaxed lifestyle. Adelaide boasts high levels of walkability coupled with a bicycle-friendly culture, which is further enhanced by Adelaide’s wide streets which are laid out in an intuitive grid.

Residents can enjoy a range of destinations, all accessible within 20 minutes of the CBD, including the Adelaide Art Gallery, the Botanic Gardens, National Wine Centre of Australia, Adelaide Central Market, and more. The South Australian capital is also known for its Warrawong Wildlife Sanctuary, Victor Harbour on the Fleurieu Peninsula, and the globally renowned Barossa Valley vineyards.

Adelaide Oval on the River Torrens

7

Adelaide Botanic Gardens Adelaide Oval

Rundle Mall

Glenelg Beach

Adelaide Arcade Himeji Garden

Chinatown Port Adelaide Adelaide Hills

Adelaide Convention Centre University of Adelaide Seacliff Beach

8

1,534,0381,426,4211,326,354

2018 2028 2038

PopulationAdelaide is currently Australia’s fifth largest city with a population of over 1.3 million people and counting.

In 2017, South Australia’s population recorded a net increase, growing by 10,700 people. Over 11,700 overseas migrants called South Australia their home, with a further addition of 5,000 people as a result of the state’s rate of natural increase. However, net interstate migration numbers trended downward in 2017, with over 6,000 moving to other states and territories.

Accordingly, reversing interstate migration outflows will be a key part of South Australia’s strategy to increase the rate of growth. South Australia’s most recent population growth has been driven by a combination of overseas migration and natural increase. The issue of boosting

population numbers has been classified as a major priority by the State Government, who have announced various measures to catalyse growth in the region.

Several policies have already been introduced to drive jobs growth, which will in turn help to attract an even larger number of overseas migrants, while improving interstate migration flows. Adelaide’s multibillion infrastructure pipeline, booming defence industry, and leadership across technology, innovation and sustainability will help support this growth. The State Government has also identified retaining and attracting young adults and families as a key focus area.

Adelaide’s population is expected to continue to grow as a result of the city’s liveability appeal, solid employment prospects, and family-friendly lifestyle drivers.

5

5th largest city .

140,000+Population Growth

Past 10 Years

Net Overseas Migration

2016 - 2017

Main Population Driver

5.3% ofthe

Australian Population

Australia’s . 5th largest . city .

= 100,000

Projected Population Growth - Greater Adelaide

9

Semaphore Beach

10

Glenelg Beach

11

Demographics

With over a third of Adelaideans born overseas, the city is rich with cultural diversity.

Overseas Born Residents: Like Like most major capital cities in Australia, Adelaide is a multicultural hub. Over a third of the population was born overseas, according to the latest Census data. The 5 largest groups of overseas born residents were from the United Kingdom (6.2%), India (2.0%), China (1.8%), Italy (1.3%) and Vietnam (1.1%). Some of the largest gains between the 2011 Census and 2016 Census, were from China, with the data showing an increase of over 40%.

Language Spoken at Home: Adelaide’s language distribution shows how culturally diverse the city is. The top 5 languages, other than English, spoken at home include Italian (2.1%), Mandarin (2.1%),

Greek (1.7%), Vietnamese (1.4%), and Cantonese (0.7%). When combined, the Chinese languages (Mandarin and Cantonese) were the number one non-English language spoken at home.

Level of Education: Adelaide is a highly educated capital city. According to the 2016 Census, 21.2% of the population held a “Bachelor or Higher Degree”, 19.3% of the population held a “Certificate (I, II, III, IV)” and 8.8% held an “Advanced Diploma or Diploma.” The largest gain over the Census periods (2011 to 2016) was in the number of people who had graduated with a “Bachelor of Higher Degree”, with the figure rising by 43,400 people.

Dwelling Structures: Of all Adelaide dwellings, 75.2% were houses, 17% were townhouses and

7.8% were apartments. Between 2001 and 2016, lone person households increased by 2.8%. Of all major capital markets, Adelaide had the second lowest share of dwellings that were apartments. However, as the state population continues to increase and concentrate in Adelaide, and single household numbers continue to grow, it is expected that apartments will become increasingly popular.

$48,308 $57,460

$65,624

2006 2011 2016

Household Composition

6.2%

1.1%

1.3%

1.8%

2.0%

Bachelor or Higher Degree

Certificate (I, II,III,IV) .

Advanced Diploma or Diploma

Chinese Italian Greek Vietnamese

3%

2%

1%

0%

Dwelling Structures

Houses Townhouses Apartments

Median Annual Household Income

Families (68.7%) Lone Persons (27.4%)Groups (3.9%)

EducationLanguages Spoken at Home(Other than English)

95,500

26,270 23,919

United Kingdom India China

Overseas Born Residents

12

“Adelaide is one of the world’s most liveable cities and a region that’s ever evolving. It all began with an inspired vision for an urban grid with generous boulevards and thriving public squares.” - Government of South Australia

Infrastructure - Headline Projects

Adelaide North-South Corridor: $709mCompletion: 2023 The North-South Corridor was strategically identified in 2010 as a major transport corridor by the South Australian Government. The 30 Year Plan for Greater Adelaide, a strategic framework to guide the long term growth of Adelaide, noted the importance of the corridor for economic prosperity and sustainability. The North–South Corridor is a critical transportation spine for Adelaide, with Infrastructure Australia identifying the project as being one of national significance. The project will connect the rapidly expanding industrial and residential growth areas in the north and the south. It will also provide new and exciting opportunities for economic development and jobs creation. The project will extend across 78km of road, and upon completion, will reduce congestion, minimise transit delays, and eliminate existing bottlenecks present within the current road network.

Gawler Line Rail Upgrade Stage 1: $615mCompletion: 2023 (Estimated)

As one of Adelaide’s busiest rail lines, the Gawler Line Rail Upgrade project will help to deliver faster, safer, cleaner and more reliable rail services for the northern suburbs of Adelaide. Recently, Lendlease was appointed as the lead contractor for the design and construction of the first stage of the project which runs between Adelaide and Salisbury. Stage 1 will create 135 jobs during construction. As a result of the project delivery model, all steel for the project is to be sourced from Australian-standard certificate fabricators and mills, which will in turn support local jobs and businesses.

Adelaide Casino: $330mCompletion: 2020

The upgrade of Adelaide Casino will result in a world-class gaming precinct that will help to increase tourism and investment in the region. With a $330 million upgrade underway, the Adelaide casino will join the worldwide ranks of premium gaming markets, attracting more interstate and overseas visitors. The project involves extensive redesign of interiors, revamping selected social, entertainment and gaming areas, as well as strategically relocating restaurants and bars. The project is expected to provide up to 1,000 jobs during the construction phase, and an additional 800 ongoing jobs once the Casino is fully completed. The project will also include the delivery of 123 hotel rooms.

13

Moseley Square, Glenelg

14

Moseley Square, Glenelg

15

Port Adelaide Masterplan: $2bn Building Better Schools ProgramCompletion: 2037 New master-planned community with up to 1,500 construction jobs.

Completion: 2024 Just over 90 South Australian public schools will benefit from a $690 million investment.

Women and Children’s Hospital

Submarine Fleet Building: $50bn

Completion: 2024 New $528m hospital will be an important piece of health infrastructure for Adelaide.

Future Frigate: $35bnCompletion: 2020 A fleet of 9 vessels to replace the ANZAC class frigates. Construction is expected to create up to 1,500 jobs.

Completion: 2030 The next generation of submarines for Australia will be constructed in Adelaide.

Ten Gigabit Adelaide: $12mCompletion: 2018 A revolutionary high-speed fibre optic data network being rolled out to commercial buildings across Adelaide.

Northern Connector: $885m Festival Plaza Upgrade: $600mCompletion: 2020 24-storey office tower and a complex of restaurants, shops and cafes.

Completion: 2019 The project will be a 6-lane, 15.5km motorway that will increase freight and commuter connectivity.

Joy Baluch AM Bridge: $200mCompletion: 2023 Duplication of the existing 2-lane bridge, leading to better travel efficiency.

Infrastructure - Major Projects

16

“Between its central location, burgeoning tourism industry, thriving private sector, and proactive business support from local and state governments, Adelaide has become one of Australia’s most profitable cities for business and investment.” – City of Adelaide

Employment

Health Care and Social Assistance 15.5%

Adelaide features leading healthcare infrastructure such as the Royal Adelaide Hospital and Flinders Medical Centre. A number of important health infrastructure initiatives are in the pipeline to further support the sector, such as the $528 million Women and Children’s Hospital.

Retail Trade 10.8%

With retail trade turnover rising at healthy rates of 4% over the year to March 2018, the South Australian retail trade sector continues to benefit from improved consumer spending and the state’s reputation for world-class food and wine.

Education and Training 8.9%

With its strong educational institutions and its reputation for being a “Learning City”, Adelaide’s educational offering continues to attract students, researchers and academics, from across the globe.

The Greater Adelaide economic region is supported by close to 590,000 workers, spread across a diverse range of industries.

In the 12 months to April 2018, South Australia delivered an economic growth rate which was 16.8% higher than the annual average for the past decade. This performance has helped to drastically improve employment figures, with the rate of unemployment falling from a high of 7.2% in April 2017, to only 5.6% in March 2018.

One of the major drivers of employment has been Adelaide’s multibillion infrastructure pipeline, which includes the $165 million expansion of Adelaide Airport. The airport is currently the state’s largest employer at a single site, and is a key piece of infrastructure for Adelaide’s strong tourism and international education industries.

The economy will continue to strengthen on the back of strategic policy objectives around cultivating rapid growth across technology, sustainability and innovation. The successful installation of the world’s largest lithium-ion battery was a

huge achievement for the people of South Australia. It cemented the state’s reputation as a clear leader in this space. Following on from this achievement, the South Australian Government has continued a number of exciting developments with Tesla, including plans to develop the world’s largest virtual power plant.

In addition to these innovations, the South Australian capital has made significant headways to further bolster its booming defence industry. South Australia is home to more than 8,000 defence personnel and a number of key operational and support bases. Defence Minister Christopher Payne commented that over $2.6 billion in defence money would be directly spent in the state for the 2018 financial year alone. Adelaide’s submarine and frigate projects are collectively valued at close to $90 billion, with major construction works scheduled for 2020.

Together these projects are forecast to create more than 25,000 jobs, and will be important for driving employment opportunities for generations to come.

Top 3 Occupations

130,848

83,026 77,599

Professionals Technicians and Trades

Workers

Clerical and Administrative

Workers

Top Employment Industries

52,42663,200

91,299

Health Care and Social Assistance

Retail Trade Education and Training

Key Employment Industries - Percentage of Workforce

17

Post Office, Victoria Square

18

Transport “The city itself is thoughtfully designed, with wide streets in a simple grid layout and central squares in all four corners, and it’s bordered by 900 hectares of green parklands. Well serviced by public transport, it’s also exceptionally easy to navigate under your own steam. Traffic is rarely congested and bike paths are plentiful.” - City of Adelaide

Train

Public Transport Choice: #2

Trains are the second most popular mode of public transport in Adelaide. The rail network has 6 lines with more than 81 passenger stations across 125.9km.

Tram and Light Rail

Public Transport Choice: #3

Trams are the third most popular mode of transport in Adelaide. The city operates a Free City tram between the South Terrace tram stop and the Entertainment Centre.

Cycling

Adelaide is known for its wide, flat streets and abundance of cycling paths which make getting about very easy. The city itself is enveloped in a strategically designed cycling path greenbelt. This makes for a scenic loop around Adelaide.

Walk

The Adelaide CBD is a walker’s paradise reporting a Walk Score of 99/100. This is a big driver for residents who are increasingly choosing to live in inner-city apartments.

Roads

With a well-defined city layout and wide multiple-lane roads, Adelaide offers superb road infrastructure. Commuters are able to travel from metropolitan outskirts to the city centre in 20 minutes or less.

Bus

Public Transport Choice: #1Buses are the most popular mode of public transport in Adelaide. The bus network is the most extensive service of all major public transportation options within Greater Adelaide. The city offers free CBD connector services within the city.

National Airport Expansion Project - Adelaide Airport

Adelaide Airport is the fifth busiest airport in Australia, servicing just over 8 million passengers in the 2017 financial year. Located adjacent to West Beach, it is roughly 6 km west of the Adelaide CBD. The airport has received numerous awards, including being named the world’s second-best international airport. It has also been named Australia’s best capital city airport on 3 separate occasions. Over the 2017 financial year, the airport experienced an 11% increase in international passengers, and 1.5% in domestic and regional passengers.

As a result of increased demand, the airport will be undergoing a $165 million dollar upgrade which will involve improvements to the terminal, as well as an 80% increase in retail and dining space, resulting in an additional 16,500 square metres of floor space. The project will create 200 jobs during construction and an additional 630 direct and indirect jobs due to retail expansion. It is expected to be completed in 2021.

19

20

University of Adelaide

21

EducationSouth Australia’s commitment to primary and secondary education is clearly demonstrated with its record education infrastructure investment of $692 million.

This investment will go towards additional educational facilities, new buildings, as well as modernisation of learning spaces. It is expected that 67,000 students across 91 schools within South Australia will benefit from this investment. Works are already underway as at the end of 2017 with all projects expected for completion at the end of 2023.

South Australia is home to some of the world’s best educational institutions with multiple top ranking universities. The demand for South Australia’s educational offerings are evidenced in continual rise in tertiary education enrolments. Student enrolments have risen at a faster rate since 2012, rising from 84,292 to 102,259 and counting. International students made up the majority of this gain, growing by 15.46% from 2015 to 2016, which is the highest growth rate for the past 5 years.

University of South Australia• Over 5,000 international students

supported by almost 3,000 university staff

• Ranked as a Top 10 university in Australia and South Australia’s number 1 university for student satisfaction

• Rated 5 stars for excellence across research, employability, teaching facilities, internationalisation, social responsibility, and innovation, according to 2018 QS STARS ranking

University of Adelaide• University of Adelaide is a

member of Australia’s prestigious ‘Group of Eight’

• Ranked in the top 1% of universities worldwide across major international ranking bodies

• Distinguished alumni include 5 Nobel Laureates and over 100 Rhodes Scholars

• The University attracts over 27,000 international students from more than 90 countries

Flinders University• Rated number 1 in Australia across

9 categories for international student experience

• Over 4,600 international students from more than 90 countries

• Over 100 partner institutions across 33 countries

• Over 90% of research is rated world standard or above, including areas such as autonomous vehicles and clean technology

Tertiary Education Student Enrolments

2001 2005 2009 2013 2016

70,000

80,000

90,000

60,000

50,000

100,000

110,000

56,722

79,217

102,259

22

Housing Market

“For investors, Adelaide represents almost irresistible value… And it’s highly affordable compared to Sydney and Melbourne… prices just keep on keeping on.”

- Dr. Andrew Wilson, Chief Economist, My Housing Market

Market Performance

Adelaide housing recorded a solid 4.1% gain over the 12 months to March 2018. The median house price is now $467,242, which makes the South Australian capital the most affordable capital city market. According to SQM Research, the March 2018 vacancy rate came in at a tight 1.4%. Rental yields have remained strong at 4.6%. Median asking rents were $360 per week, and as a result of a tight rental market, rents increased by $10 per week over the 12 months to March 2018.

Increased Investor Interest

The Adelaide housing market continues to experience higher levels of interest from investors, particularly from cashed-up Sydney and Melbourne buyers. Recent data out of RealEstate.com.au indicates that Adelaide’s ‘online search interest’ from Sydneysiders and Melburnians experienced a 10% increase compared to the previous year. A major drawcard for investors has been the solid underlying fundamentals of the market, which have been largely underpinned by Adelaide’s affordability compared to Sydney and Melbourne. In addition, the South Australian capital is still recording healthy rental yields combined with a very low vacancy rate, which is a further incentive for buyers. Another driver for the increased levels of interest has been South Australia’s strong economic performance and multibillion infrastructure pipeline. When combined with the market’s reputation for reliable and solid returns, it is easy to see why Adelaide continues to attract investors.

Technology and Innovation

Adelaide’s property market will benefit from the city’s focus on becoming Australia’s own ‘San Francisco’, a

world city fuelled by technology and innovation. The South Australian Government has already made strong progress on this front, with projects such as the “Ten Gigabit Adelaide Plan” which is already being rolled out. The project involves delivering key technology infrastructure that will enable ultra-high-speed internet across 1,000 commercial buildings in the CBD. Lord Mayor, Martin Haese noted that such infrastructure would be instrumental in creating jobs and stimulating investment in the region. Once the rollout is completed, Adelaide will become the world’s first non-American ‘Gigabit City’, joining the ranks of brand-name cities like Chattanooga, Tennessee and Austin, Texas – places which are globally renowned for their advanced network infrastructure and thriving ecosystems of innovation, research, and commercialisation. The state’s push towards this direction has already produced a vibrant tech community with a number of Adelaide startups expanding to international markets. Another promising sign in this space has been the mid-2017 decision by TechStars - an elite US startup accelerator program – to choose Adelaide as its first entry point into the Asia Pacific region.

Energy and Defence Spending

The relationship between Tesla and the South Australian Government has been an important part of raising Adelaide’s international profile, particularly in the energy space. The Government’s commitment to renewable energy and sustainability has culminated in the state’s $550 million energy plan, which will create thousands of jobs and drive economic growth. These initiatives are important macro drivers which positively influence the property market. In addition, the South

Australian economy will benefit from massive defence and military spending. According to Defence Industry Minister, Christopher Pyne, South Australia’s shipbuilding projects are collectively valued at almost $90 billion. The scale of these projects is significant and would be felt for decades to come. Investments such as these will be instrumental in driving population growth, while adding to already solid employment fundamentals which attract international and interstate migrants. Accordingly, analysis shows that these projects alone, will deliver up to 25,000 new jobs, and increase the state population by up to 50,000 people. Minister Pyne also said, “I don’t think that the South Australian public, or the business community or the South Australian Government has yet grasped the transformative potential of this defence industry investment... People will move here from interstate and that’s what we want”. Strong flow-on effects were also expected across Adelaide’s world leading universities with further research and development opportunities in defence and related sectors.

Market Outlook

The Adelaide housing market is expected to continue to perform positively in coming years. The South Australian capital’s reputation for steady and reliable returns is forecasted to continue. This is supported by increased investor interest as well as the state’s strong momentum across key areas such as renewable energy, innovation and defence. These economic drivers will be pivotal in underpinning jobs and population growth in the years ahead.

23

$200,000

$300,000

$400,000

$100,000

$000,0001998 2002 2008 2012 2018

$126,861

+10.75% p.a. Average Growth

$352,316

$467,242


$500,000

Adelaide Houses, 20 Years of Capital Growth: April 1998 – March 2008 (Residex) April 2008 - March 2018 (Corelogic)

Adelaide Houses, Key Statistics:

1 year ago it was $448,840

4.60%Median Rental Yield

$467,242Median Value

1.4%Vacancy Rate

1 year ago it was 1.7% Median Rent: $360p.w.(+$10 from March 2017)

4.10% Capital Growth

(12 months to March 2018)

20,092Annual Sales

1 year ago it was 20,540

Building Approvals

6,7601 year ago it was 6,365

$600,000

March 2018

24

“When it comes to our real estate market, people are now most optimistic about SA property growth prospects than anywhere else in the country.”

- Real Estate Institute of South Australia President, Alexander Ouwens

Apartment Market

Market Performance

The Adelaide apartment market was the second best performing apartment market, recording a strong 6.2% gain over the 12 months to March 2018. Apartments outperformed houses which grew by 4.1%, and Adelaide apartments continue to be the most affordable of the major capital city markets. The rate of increase for Adelaide apartment sales volumes led all major capital city apartment markets, growing by 6.3% over the 12 months to March 2018. Rental growth led all major capital city markets, with landlords being able to increase their weekly asking rents by $15. The median rental yield sat at an attractive 5.1%, which was the second strongest rental yield of all major capital cities.

Apartment Demand on the Rise

Adelaide apartments delivered stronger capital growth than houses, a trend which was driven by the wider demographic shifts towards apartment living. One of these shifts is Adelaide’s shrinking average household size. Between the 2011 Census and 2016 Census, the number of lone-person households increased by over 14,500, and 2-person households by over 17,100. As a result, the combined growth of these 2 household types accounted for 56% of the overall gain. This is a demographic that is increasingly attracted to apartment living. The lure of inner-city living, coupled with modern apartment building amenity such as cinemas, pools, gyms, spas and more – as well as better affordability compared to houses, make apartments an easy choice. At the same time, in spite of increased demand, apartments still remain a very low percentage of overall dwellings in the region at 2.3%, which is the smallest percentage of the 5 major cities.

Growth in Diversified Industries

Adelaide is experiencing a growth in diversified industry segments, which will lead to stronger population growth and hence, underlying demand for property. The South Australian Government noted that, “the Marshall Government is unashamedly pursuing a jobs agenda.” Key industries which have already seen tremendous growth have been education and defence. In relation to education, Adelaide’s world-renowned universities continue to attract thousands of students, researchers, and academics from across the globe. The marked rise in South Australia’s international enrolments is evidence of this, with the most recent 2016 enrolment numbers rising by a significant 15.5% over the previous year, according to the Department of Education and Training. The success of international education also has had positive flow-on effects with retail and tourism. The South Australian Government noted that “accelerating growth in our international education sector will drive our economy, create jobs, and strengthen our international connections and engagement.” Another important trend has been South Australia’s multibillion defence program, which will be a key driver for the state economy in coming years. In addition to massive benefits achieved during the design and building phase of these contracts, additional flow-on effects will also be felt in other areas of the economy. The South Australian Defence Minister, Martin Hamilton-Smith commented that, “the true value of large-scale defence industry is not just the build, but all of the industrial, financial and research-based benefits that accrue because of the build.” This significant public investment has resulted in strong jobs growth, particularly across advanced manufacturing and high-end

engineering.

Population Growth and Young Adults and Families

A major emphasis of the South Australian Government is population growth, and in particular, retaining young adults and families. In recent times, Adelaide’s population growth rate has been relatively subdued compared to other major capital cities. This has been largely a result of negative interstate migration, and as such the South Australian Government has made it a priority to increase population growth and reverse this trend. Part of this strategy includes retaining young adults and families, with objectives such as supporting start-ups, increasing tourism, and driving international student numbers further. South Australian Premier Steven Marshall announced that “We’re going to be spending every day in government working … to grow jobs and to keep young people here in South Australia.” Further, Adelaide’s lower cost of living will be an important drawcard for population growth, particularly for young adults and families. According to the recent 2018 Mercer Cost of Living Index, Adelaide remains the most affordable of all major capital cities to live in.

Market Outlook

The market outlook for Adelaide apartments is positive. Given the demographic shift towards smaller household sizes and current supply numbers, the apartment market is expected to strengthen. Moreover, the Government’s emphasis on population growth and retaining young adults and families will also translate to higher demand for apartment living and as a result, apartments will play a bigger role in the current dwelling mix for the South Australian capital.

25

$200,000

$300,000

$400,000

$100,000

$000,000

1998 2002 2008 2012 2018

$92,184


$262,554

$348,245


$500,000

$600,000

Adelaide Apartments, 20 Years of Capital Growth: April 1998 – March 2008 (Residex) April 2008 - March 2018 (Corelogic)

1 year ago it was $327,914

5.10%Median Rental Yield

$348,245Median Value

1.4%Vacancy Rate

1 year ago it was 1.7% Median Rent: $315p.w.(+$15 from March 2017)

6.20% Capital Growth

(12 months to March 2018)

7,381Annual Sales

1 year ago it was 6,963

Building Approvals

3,9381 year ago it was 3,357

Adelaide Apartments, Key Statistics:March 2018

26

Report Data Sources• ABS http://www.abs.gov.au

• ANZ https://www.anz.co.nz/about-us/economic-markets-research/

• APM Price Finder https://www.pricefinder.com.au/

• APRA https://www.apra.gov.au/

• Australian Government https://www.australia.gov.au/

• BIS Oxford Economics https://www.oxfordeconomics.com/bis

• Brisbane Times https://www.brisbanetimes.com.au/

• CBRE https://www.cbre.com.au/research-reports

• Charter Keck Cramer http://charterkc.com.au/news-insights/

• CommSec https://www.commsec.com.au/stateofstates

• CoreLogic https://www.corelogic.com.au/news

• Credit Suisse https://www.credit-suisse.com/au/en.html

• Deloitte https://www2.deloitte.com/au/en/pages/finance/topics/deloitte-access-economics.html

• Demographia http://www.demographia.com/

• Department of Education and Training https://www.education.gov.au/

• Dexus https://www.dexus.com/

• Digital Finance Analytics http://www.digitalfinanceanalytics.com/

• Domain https://www.domain.com.au/

• Foreign Investment Review Board http://firb.gov.au/

• Herron Todd White https://www.htw.com.au/month-in-review/archives/

• HIA https://hia.com.au/

• ID The Population Experts https://home.id.com.au/demographic-resources/

• JLL http://www.jll.com.au/australia/en-au/research

• Knight Frank http://www.knightfrank.com.au/research

• KPMG https://home.kpmg.com/au/en/home.html

• LF Economics https://www.lfeconomics.com/

• Macrobusiness https://www.macrobusiness.com.au/

• Matusik http://matusik.com.au/

• McCrindle https://mccrindle.com.au/

• McGrath https://www.mcgrath.com.au/

• Mirvac https://www.mirvac.com/

• NAB Group Economics https://business.nab.com.au/author/nab-group-economic/

• NSW Government https://www.nsw.gov.au/

• OECD http://www.oecd.org/australia/

• Place Projects http://www.placeprojects.com.au/

• PwC https://www.pwc.com.au/

• QBE https://www.qbe.com.au/campaigns/housing-outlook

• QLD Government https://www.qld.gov.au/

• Ray White https://www.raywhite.com/

• RBA https://www.rba.gov.au/

• RealEstate.com.au https://www.realestate.com.au/news/

• REIA https://reia.asn.au/

• REINSW https://www.reinsw.com.au/

• REIQ https://www.reiq.com/

• REIVIC https://reiv.com.au/

• REIWA https://reiwa.com.au/

• Residential Tenancies Authority https://www.rta.qld.gov.au/

• Residex http://www.residex.com.au/

• SA Government https://www.sa.gov.au/

• Shutterstock http://shutterstock.com

• SQM Research http://sqmresearch.com.au/

• The Age https://www.theage.com.au/

• The Australian Financial Review https://www.afr.com

• The Australian https://www.theaustralian.com.au/

• The Economist https://www.economist.com/

• The Sydney Morning Herald https://www.smh.com.au/

• Trading Economics https://tradingeconomics.com/

• Treasury http://www.treasury.gov.au/

• UBS https://www.ubs.com/au/en.html

• UDIA http://www.udia.com.au/

• Urbis https://urbis.com.au/

• VIC Government https://www.vic.gov.au/

• Westpac https://www.westpac.com.au/about-westpac/media/reports

• World Bank https://www.worldbank.org/

The information contained in this document has been collected by Ironfish from various government, public and private sources, which may include property developers, builders and other industry participants. Neither Ironfish nor any representative of Ironfish gives any warranty as to the accuracy of the information contained in this document and expressly disclaims any liability for loss or damage which may arise from any person acting or deciding not to act on the basis of any of the information contained in this document. This document is intended to provide Ironfish investors with general information only and does not constitute an offer, contract or inducement to buy. Investors are expressly recommended to do their own due diligence in relation to any residential property investment decision they make.

Disclaimer:

27

Ironfish Investment Resources

Our Unique Investor Services National Network

Local Strategists

Research Driven

Quality Properties

Pre-public Buying

Long-term Approach

Australia-Wide Branches

Personalised Customer Service

Quality Research Investor Tools

Great Locations

Negotiating Power

10-15 Years

Portfolio Approach Our Portfolio Approach to investing is a simple yet powerful strategic approach to build, step-by-step a diverse portfolio of different types and locations and hold onto it over the long term.

Ironfish Seminars We provide regular investor educational seminars in English and Chinese around Australia. They provide up to date property market information and effective investment strategies presented by many of Australia’s prominent property experts.

PPA Software Our educational Ironfish PPA Portfolio software tool has been customised to ensure our professional Strategists can help investors understand firsthand how to cash flow an investment property and build equity over time.

My Property Reports Extensive due diligence and research is done by Ironfish’s Property and Research division on the merits of each approved property, with key project information, demographics and market research presented in a My Property report for investors.

My Market Reports Our Research team monitors Australia’s 5 capital city property markets and publishes a quarterly review that incorporates the latest property data, market commentary and fundamental analysis of issues impacting each market.

My City Reports Our My City reports are an annual series of educational, magazine style publications that are an essential guide for investors to understand each major capital city, their unique qualities and fundamental property market drivers.

28

www.ironfish.com.au

“It’s not what you buy now, but what you own in 10 or 20 years that will make you wealthy.” – Joseph Chou

At Ironfish, it’s our mission to help our customers achieve long-term financial well-being through smart portfolio investing. As an industry leader, with offices in 10 cities across Australia and China, we support our investors in acquiring a diversified property portfolio, backed by the confidence of the latest research, personalised strategies and quality investment opportunities.

adelaide, australia · entertainment options. with south australia being known as the festival...

Documents