The Australian Financial Review has spoken to the team behind the most intriguing recent property sale for our column, How it Sold.
The property: A three-level building with seven bedrooms in three units on 433sq m, with a 120sq m right of way easement, 32 The Esplanade, Surfers Paradise, QLD. Sold at auction $6.55 million.
Who was the agent/agency? Amir Mian, Prestige Property Agents Southport. The buyer was town planner Jason Hague.
How long was this on the market? [Amir] Just over four weeks.
Why did this one sell? It was a very rare block. Only last free-standing home in Surfers Paradise on the Esplanade. It had three units and could have been used as a private residence – it was a proper brick and tile building. But the position and the zoning – there were no height restrictions. Position was the main thing.
Was it overpriced? No. It deserved what money we got for it. I wouldn't say it was cheap.
What did you think it would go for? I was expecting $6.5 million; we got $6.55 million.
What was surprising about it? [Jason] My background is town planning. I've been looking around for a while. In the last few months I got wind it was going to come on to the market.
I love the Gold Coast. I've lived in Sydney, I've lived in London and I love that CBD living – that's what Surfers Paradise is about. There's a lot of money being spent on infrastructure. That Light Rail – that works because of density. It's a linear shape, the Gold Coast. It doesn't need a system that radiates out. It just needs a train line that drops off at nodes and around those nodes you get density. And it works. There are not too many places where you can say that can be achieved in Australia. The Gold Coast council – they've got $15-$20 billion in infrastructure going in the next few years in various projects. You have to go a long way to find that type of spend.
The Light Rail is going to be connected to Helens Vale shortly, which will connect directly to Brisbane by train. That's just about to finish. We've got the Commonwealth Games coming up.
The Gold Coast is maturing. That Light Rail has put it in a different league, in respect of where it was and where it's going. Investors are seeing that. Hoteliers are seeing that.
[Amir] It was surprising that there were a lot of people there who would have paid that sort of money. Usually for these places you only get one buyer who agrees with that sort of money. In this case you had a lot all in the same vicinity. At a price of $15,128 per square metre, it shows health in the market.
[Jason] There were four or five that missed out who were around that price point. They're out there today, looking again. Three of them were hoteliers. I've done a few smaller developments myself. In 10 years' time what's the Gold Coast population going to be? It's going to be 50 per cent larger. There are some big numbers.
Will that add another 50 per cent to your site's value? [Jason] It's meant to double every seven [years], isn't it?
Will you develop the site? [Jason] The size limits it. It's very constrained. It'll be for my family and whoever rents out the other units and wants to enjoy Surfers Paradise. That's the intention at present. The owner spent half a million doing it up internally. There's nothing to do.
Do you reckon we'll see another result like this: a) next week b) next year c) next cycle d) never? [Amir] b) We would see something like that next year. But the difference here is there won't be another place like this.