MARKET OUTLOOK FOOTSCRAY Footscray offers residents excellent accessibility to major educational, health and retail precincts, while being located only 5 kilometres from Melbourne’s CBD.
Footscray's Key Drivers
POPULATION GROWTH
+25,000 by 2031
INFRASTRUCTURE INVESTMENT
$31B by 2026
EMPLOYMENT
+290,000 by 2026
Prepared exclusively for
Bensons Property Group
May 2018
Top: Maribyrnong River and City; Bottom left: 'Small Graces' Cafe; Bottom right: Footscray Railway Station
WALKABILITY & ACCESSIBILITY Footscray is situated 5 km west of the Melbourne CBD and benefits from excellent accessibility to educational, health and retail precincts from major roads, public transport networks and active transport routes. EDUCATION
04
Melbourne Airport 20 mins drive
SUNSHINE
There are 23 schools within Footscray and the surrounding suburbs of; West Footscray, Seddon, Kingsville, Yarraville, Tottenham, Maidstone, Braybrook and Maribyrnong. These range from primary to secondary level including: eight Catholic schools, one language school and three distinct special schools. The University of Melbourne, Australia’s top rated tertiary institution, lies approximately five kilometres from Footscray. In addition, RMIT University is in Melbourne’s CBD. Victoria University’s main campus is located within Footscray. With more than 27,000 students studying at Victoria University, it offers residents convenient access to tertiary education, with specialties in health and education studies, along with facilities for vocational training (TAFE).
Sunshine Station
HEALTH
Residents have the convenience of the Footscray Hospital and Western Private Hospital which are located within the suburb. Footscray Hospital has 290 beds, offering a range of inpatient and outpatient services. Major hospitals such as The Royal Melbourne Hospital and Sunshine Hospital are located 5.5 km and 9.7 km, respectively from Footscray. RETAIL
Footscray features more than 120 shops and shopping precincts including Nicholson Street Mall, Footscray Market and Little Saigon Plaza. Nearby retail amenity includes Highpoint Shopping Centre. Highpoint features 500 stores and is Victoria’s second largest centre with the tram journey to Highpoint just 16 minutes from Footscray Station. PUBLIC TRANSPORT
Footscray Station was upgraded in 2014 and is serviced by three metropolitan train lines: Sunbury, Werribee and Williamstown. Three regional train lines (Geelong, Ballarat and Bendigo) also pass through Footscray Station. The 82 route tram runs from Footscray to Moonee Ponds, to service residents travelling to Footscray Market, Victoria University, Footscray Hospital, Highpoint Shopping Centre and Maribyrnong Aquatic Centre. There are also 14 bus routes that run through Footscray. CONNECTIVITY
Residents are also well placed to travel by car directly into Melbourne on the West Gate Freeway. Public and private investment into Melbourne’s arterial roads will improve accessibility and ease congestion. PARKS AND RECREATION
Residents have access to over 65 hectares of open space in Footscray. Major parks in the area include Footscray Park, Quarry Park, Burndap Park, Maribyrnong River Reserve and the river boardwalk.
2
Market Outlook Footscray
Train Station Central Activity District Employment Cluster Boundary Principal Activity Centre
19
Melbourne’s CBD can be accessed in 15 minutes from Footscray, while the suburb is developing its own health, education and employment precinct.
MOONEE PONDS
MARIBYRNONG
RIVER NG RO
Highpoint Shopping Centre
12 Monash University (Parkville)
M
AR
15
IBY
Melbourne Zoo
PARKVILLE
14 18 Victoria University (Footscray Park)
FOOTSCRAY
T U L L A M A R IN E
07
FREEWA Y
17
02 10
Flemington Racesourse
09
16 Footscray Station West Footscray Station
Middle Footscray Station
13
Victoria University (Nicholson St)
05 Melbourne University
03
08
06
01
RMIT University
MELBOURNE CBD DOCKLANDS
11
La Trobe University
FISHERMANS BEND
WE S
Victoria University (Flinders St)
T GAT
E FREEWAY
HOSPITALS
PRIMARY SCHOOLS
SECONDARY SCHOOLS
01 Royal Dental Hospital
07 St John's School
15 Maribyrnong Secondary College
02 Western Hospital
08 Footscray City Primary School
16 Gilmore College For Girls
03 Royal Melbourne Hospital
09 Footscray Primary School
17 Footscray City College
04 Sunshine Hospital
10 Footscray West Primary School
18 Seda College (Victoria)
05 The Royal Childrens Hospital
11 Yarraville West Primary School
19 Caroline Chisholm Catholic College
06 The Royal Womens Hospital
12 Ascot Vale West Primary School 13 St Monica's School 14 Footscray North Primary School
Prepared exclusively for Bensons Property Group
3
INFRASTRUCTURE & EMPLOYMENT
Footscray is well located to take advantage of over $31 billion worth of investment in Melbourne’s Inner West.
INFRASTRUCTURE
EMPLOYMENT
The suburb of Footscray is transforming from its industrial history to a vibrant community of eclectic food markets and a broad restaurant scene. Footscray is identified as a Metropolitan Activity Centre (MAC), set to become a hub of investment into education, health and higher density housing.
Residents of Footscray have access to over 12,000 local jobs and approximately 567,000 jobs in the Central region of Melbourne. A majority of the workers in Footscray are employed in the health care and education industries, supported by Footscray Hospital, Western Private Hospital, Victoria University and six government and two non-government schools in the area. As a MAC, Footscray will play a significant role in providing education, social and public services as well as employment for the region.
The Little Saigon Plaza has recently undergone a $5.4 million redevelopment with a new forecourt, ground floor retail and car park. The Little Saigon apartments, two residential towers comprising 260 apartments and a recreation style retail centre are due for completion in 2020. There are approximately 30 similar mixed use developments around Footscray worth over $750 million, due for completion over the next three years. This type of development is anticipated to continue adding amenity, activation and supporting demand for housing in the area.
SUB-REGION MAP ACCORDING TO PLAN MELBOURNE
Key infrastructure projects include: 01 WEST GATE TUNNEL PROJECT $6.1 billion; 2022 Completion
The Victorian Government have partnered with the West Gate Tunnel Project to deliver an alternative route to ease congestion on the West Gate Bridge. The project includes: widening of the West Gate Freeway, ramps between West Gate Freeway and Hyde Street, a new tunnel under Yarraville, a new bridge to connect the Port of Melbourne at MacKenzie Rd and new cycle and walking paths. The Victorian economy will benefit from a $11 billion boost and 6,000 new jobs from construction.
NORTHERN SUB REGION WESTERN SUB REGION FOOTSCRAY
EASTERN SUB REGION
CENTRAL SUB REGION
02 METRO RAIL $25 billion; 2026 Completion
The Melbourne Metro Rail project will create twin nine kilometre tunnels and five new underground stations. The project will connect the Sunbury and Cranbourne-Pakenham lines to Melbourne Central and Flinders Street stations, improving peak capacity on the Sunbury Line, on which Footscray Train Station is connected, by 60%. Upon completion, the new high capacity trains will transport approximately 39,000 people over peak periods to serve suburbs of north, west and southeast Melbourne. 03 FOOTSCRAY HOSPITAL REDEVELOPMENT $50 million; 2026 Completion
The Victorian Government has allocated $50 million in the 2017/18 State Budget for purchasing extension sites, design work and construction of a new hospital which will service the growing population in Melbourne’s Inner West. There are considerations to co-locate the new hospital alongside Victoria University’s Ballarat Road campus to create a hub of health and education. 4
Market Outlook Footscray
Source: Plan Melbourne
JOBS Melbourne Central Sub-Region
2015 2031
567,000
Source: Plan Melbourne
857,000
SOUTHERN SUB REGION
POPULATION & DEMOGRAPHICS
Footscray is characterised by a young, fastgrowing population that is expected to almost double in the next ten years.
Footscray is well placed to capitalise on:
WHO LIVES IN FOOTSCRAY? Footscray (2011)
Footscray (2016)
Greater Melbourne
Average Age
36
35
37
Access to Amenity
Aged 25-39
36%
39%
24%
Proximity to Green Space
White Collar Professionals
71%
74%
73%
Bachelor Degree or Higher
30%
36%
27%
Tertiary Students
12%
15%
8%
Couples without Children
42%
46%
35%
Family Households
44%
53%
72%
Group Households
12%
14%
5%
Lone Person Households
32%
33%
23%
Proximity to Employment
Community and Networks
Walkability and Connectivity
The population of Footscray has experienced continued growth at an average of 4.6% per annum from approximately 14,000 residents in 2011 to around 17,500 people in 2016. By 2031, the population of Footscray is projected to more than double to approximately 42,600 residents. The highest growth is anticipated between 2016 to 2021 at an average of 8.4% per annum. The resident profile of Footscray is characterised by young people; mainly young professionals, students and couples without children. Between 2011 and 2016, the share of residents aged 15 to 39 in Footscray grew from 36% to 39%, higher than the Greater Melbourne average of 24%. The average age of residents in Footscray is 35 years old, younger than the Greater Melbourne average of 37. The younger demographic is drawn to Footscray’s convenient access to employment nodes, public transport, health facilities, educational institutions and entertainment offer, not to mention the relative affordability compared to other areas with those location attributes.
Source: ABS; Urbis
POPULATION FORECAST Footscray
42,600
Resident Population
45,000 40,000
36,200
35,000 30,000
26,200
25,000 20,000 15,000
14,000
17,500 PROJECTED POPULATION
10,000 5,000 0
2011
2016
2021
2026
2031
Source: ABS, SAFi, Urbis
Prepared exclusively for Bensons Property Group
5
RESIDENTIAL MARKET
Footscray is an affordable gentrifying suburb undergoing transformation. Prices have grown by 3.3% per annum in the last decade and the process of urban renewal is set to continue.
DWELLING STRUCTURE 2016
MEDIAN APARTMENT GROWTH
According to APM PriceFinder, the median sale price for apartments/units in Footscray increased by 3.3% per annum from $299,500 in December 2007 to $395,000 in December 2017, based on an average of around 299 settled transactions per annum.
RELATIVE AFFORDABILITY AND PRICE GROWTH
Compared to a selection of suburbs that are a similar distance to the Melbourne CBD, Footscray has the lowest 12-month median sale price ($395,000) and a relatively high annual rate of median price growth over the last ten years (3.3% per annum). Footscray is relatively affordable with capital growth opportunities linked to ongoing regeneration and gentrification.
Greater Melbourne
House
35%
68%
Townhouse
17%
17%
Apartment/unit
48%
15%
Source: ABS; Urbis
APARTMENT SALES CYCLE Footscray 500
No. of Transactions
To note, this data does not include off the plan sales that have not yet settled, which are expected to elevate the quality and price of stock further upon completion.
Footscray (2016)
Number of Sales
Median Price - Rolling Weighted Avg.
400
$395,000
$500,000 $400,000
300
$300,000
200
$200,000
100
$100,000
0
2007 2008 2009 2010 2011
2012 2013 2014 2015 2016 2017
$0
Source: APM PriceFinder; Urbis
MEDIAN PRICE COMPARISON Units FOOTSCRAY
$395,000
Median Sale Price (Dec 2017) 10-Year Growth
3.3% (p.a.)
BRUNSWICK
$489,000
RICHMOND
Median Sale Price (Dec 2017) 10-Year Growth
2.6% (p.a.)
Median Sale
$575,000 Price (Dec 2017) 10-Year Growth
4.2% (p.a.) HAWTHORN
Median Sale
$535,000 Price (Dec 2017) 10-Year Growth
3.3% (p.a.)
YARRAVILLE
$507,500
Median Sale Price (Dec 2017) 10-Year Growth
3.3% (p.a.)
Source: APM PriceFinder; Urbis 6
Market Outlook Footscray
DOCKLANDS
$596,000
Median Sale Price (Dec 2017) 10-Year Growth
0.4% (p.a.)
PRAHRAN Median Sale
$532,500 Price (Dec 2017) 10-Year Growth
4.2% (p.a.)
Median Price
Nearly half (48%) of the housing stock in Footscray is apartments or units, significantly higher than the Greater Melbourne average of 15%.
RENTAL MARKET Footscray has an established and growing rental market with 64% of residents renting their homes as at 2016, increasing from 56% in 2011. The share of renters in Footscray greatly exceeds those across Greater Melbourne at 31% in 2016.
Footscray has a high proportion of residents renting, 64% as at the 2016 census.
SHARE OF POPULATION RENTING 2016
Over the ten years to December 2017, rents for apartments/units in Footscray have experienced solid growth. The median rent for one-bedroom product increased by 5.4% per annum. Similarly, two-bedroom product increased by 6.3% annually and three-bedroom by 5.6% per annum. The combination of rental contract growth and rental price growth is an encouraging signal of sustained growth in demand. RENTAL YIELD
According to APM PriceFinder, apartments in Footscray achieved an indicative gross yield of 4.6% for the 12 months to December 2017. This is higher than the Greater Melbourne average of 4.0% over the same period.
ABS; Urbis
RENTAL CONTRACT VOLUME Footscray – Units 1 Bed
1,200
2 Bed
3 Bed
1,000 800 600 400 200 0
De c0 Ju 7 n0 De 8 c0 Ju 8 n0 De 9 c0 Ju 9 n10 De c1 Ju 0 n1 De 1 c1 Ju 1 n1 De 2 c1 Ju 2 n13 De c1 Ju 3 n1 De 4 c1 Ju 4 n1 De 5 c1 Ju 5 n16 De c1 Ju 6 n1 De 7 c17
MEDIAN APARTMENT/UNIT RENTAL GROWTH
31%
Greater Melbourne
RENTAL CONTRACT VOLUME
The volume of new rental contracts has grown over the past decade, indicating the increase in renters and appetite for units to rent in Footscray. Over the last ten years, the number of new rental contracts for one bedroom apartments grew by 7.4% per annum, while two bedroom apartments grew by 9.3% annually. Contracts for three bedroom apartments grew at the highest rate of 11.0% per annum.
64%
Footscray
Rolling Annual - Quarters
Source: Department of Human Services; Urbis
MEDIAN WEEKLY RENTAL GROWTH - UNITS Footscray Growth 10 years (p.a.)
Median Rent (Dec 2007)
Median Rent (Dec 2017)
VACANCY RATES
One bedroom
5.4%
$160
$270
Vacancy data indicates that residential rental properties in Footscray are experiencing a low rate of vacancy, 1.9% as at February 2018. The high proportion of households renting combined with a low vacancy rate, reinforces the continuing demand for rental properties in Footscray.
Two bedroom
6.3%
$200
$370
Three bedroom
5.6%
$320
$550
Demand for rental apartments in Footscray is driven by the growing number of students attracted by affordability and proximity to Victoria University. Young professionals are also drawn by the suburb’s proximity to the Melbourne CBD and accessibility to employment and various modes of public transport.
VACANCY RATE – FOOTSCRAY February 2018
VACANCY
1.9%
Source: Department of Human Services; Urbis
INDICATIVE GROSS RENTAL YIELD 12 months to December 2017
Footscray
Melbourne (SD)*
4.6%
4.0%
Source: APM Price Finder, Urbis *SD Refers to 'Statistical Division'
Source: SQM Research; Urbis
Prepared exclusively for Bensons Property Group
7
PER0907/M
This publication is prepared on the instruction of Bensons Property Group and is not suitable for use other than by the party to whom it is addressed. As the publication involves projections and assumptions it can be affected by a number of unforeseen variables. The forecasts and assumptions are a prediction and whilst Urbis has made every effort to ensure that the forecasts and assumptions are based on reasonable information, they may be affected by assumptions that do not necessarily eventuate or by known, or unknown, risks and uncertainties. It should be noted that past performance is not necessarily a reliable indication of future performance. The information in the publication does not represent financial advice and should not be regarded as such. It has been prepared without taking into account your financial situation or investment objectives. You should consider the appropriateness of the information in regards to your current financial situation or needs. Urbis accepts no responsibility for the accuracy or completeness of any such material. The information is subject to change without notice and Urbis is under no obligation to update the information or correct any assumptions which may change over time. This study has been prepared for the sole use of Bensons Property Group and is not to be relied upon by any third party without specific approval from Urbis. This publication is subject to copyright. Except as permitted under the Copyright Act 1968, no part of it may, in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) be reproduced, stored in a retrievals system or transmitted without prior written permission. Enquires should be addressed to the publishers.