Seniors Housing & Healthcare Trends

LOS ANGELES: Downsizers are being presented with a growing stock of upscale beach adjacent apartment choices.

Developers with proven track records, the ability to access construction finance and strong ties with builders have banked tens of millions of dollars in luxury apartment sales in the past two months, despite challenging conditions.

At Rainbow Bay near Coolangatta at the southern end of the Gold Coast, developer Paul Gedoun’s S&S Projects has recorded $40 million of sales in just two weeks since launching the luxury offering Radia. These sales are equal to nearly a quarter of the 38 premium apartments on offer.

The $200 million development offers two-bedroom apartments from $2 million up to $13.5 million for dual-level penthouses. Construction is expected to begin before the end of the year.

“It’s a tough market, buyers are very particular about what they are looking for. It’s a flight to quality,” Mr Gedoun said.

“There are a lot of projects that have hit roadblocks whether it’s construction cost issues or finance issues. There is also a limited number of builders available,” he said.
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Mr Gedoun put S&S Project’s sales success down to being able to deliver on every promise to date and complete high-quality projects. The developer has a half-billion-dollar pipeline of developments at Rainbow Bay.

“We’re ready to build right now, we’re in negotiations with a builder that we will finalise in the next few weeks, and we’ve secured finance from a big four bank,” he said.

Just north of Surfers Paradise in Southport, veteran developer Robert Badalotti has secured $40 million in sales in less than a month at $650 million Monarch Place. The tower forms part of Azzura Investment’s $3.8 billion Imperial Square project, which includes a TRYP by Wyndham hotel opening in the spring.

Most of the apartment buyers have been owner-occupiers and downsizers. Construction will begin in the coming months through Azurra’s in-house builder Platform Constructions run by Mr Badalotti’s son Fabrizio. Another son, Lorenzo, runs Southport agency Raine & Horne Elite, which sells luxury apartments for Azzura and others.

“The issues you have with developments is that someone buys a site, then starts pre-sales, but they have no construction or selling arm. Prices keep moving and builders don’t want to lock themselves in. So it makes a big difference having a one-stop shop,” Mr Badalotti said.

While the Gold Coast has outshone Melbourne and Sydney as a destination for apartment buyers over the past few years, Mr Badalotti said the market had changed significantly.

“Thirty years ago we were selling 30 per cent of apartments to overseas buyers, 40-50 per cent to buyers from Melbourne and Sydney, and 20-30 per cent to locals. Now we’re selling 60-70 per cent to local buyers, only 5-10 per cent to offshore buyers [and the remainder to interstate buyers],” Mr Badalotti said.

A report from Colliers shows there were 250 new apartment sales on the Gold Coast in the first quarter of 2024, well down from the market peak in September 2021, when quarterly sales reached close to 700 as interstate buyers sought coastal boltholes during the pandemic.

However, the average price of an apartment has more than doubled since then to almost $1.8 million as the Gold Coast has become a more cosmopolitan and sophisticated lifestyle destination, complimented by a luxury residential offering aimed at wealthy downsizers alongside new five-star hotels such as the Ritz-Carlton.

“This cycle is not speculative, it’s so different because it’s being driven by owner-occupiers,” said David Higgins, director of Gold Coast residential sales at Colliers. “These buyers are end-users, they are buying homes for themselves,”

Mr Higgins said many were buying with cash after selling significant suburban homes so they were unaffected by interest rate movements. However, what was important to them was knowing whether a project would go ahead and be completed on time, rather than stall or collapse – as has happened with several projects.

While there is solid demand, most buyers have done their research on the developer, Mr Higgins said.

“What is the certainty around the development going ahead is one of the first things buyers ask us, and how far advanced is the project?” Mr Higgins said. “Is this project real? Is it going to get built?”

Most buyers, he said, were comfortable waiting up to three years from signing a contract to getting the keys, but any longer than that, and they will steer clear.

Another Gold Coast developer leveraging its track record of completing projects is Marquee Development Partners.

It recently commenced construction on La Belle Palm Beach, a luxury beachfront project on the northern Palm Beach strip. Since launching two months ago, Marquee has sold more than 70 per cent of the 75 residences offering views from Surfers Paradise to Coolangatta.

“Marquee Development Partners is renowned for delivering exceptional projects, and La Belle Palm Beach will be no exception”, said director Jacques Winterburn.