Fairwarer - Market Outlook Blacktown 2019

MARKET OUTLOOK BLACKTOWN Blacktown is located in the rapidly growing Western Sydney Growth Corridor with residents having direct access to a regional shopping centre, hospitals, education institutions and major employment hubs.

01 Walkability & Accessibility 03 Employment, Education & Infrastructure 04 Population & Demographics 05 Residential Analysis 06 Rental Analysis Prepared exclusively for

Frasers Property

July 2019

Images supplied by Frasers Property

WALKABILITY & ACCESSIBILITY For the purpose of this profile, a Blacktown Study Area (herein referred to as the ‘Blacktown Area’) has been defined for the assessment of HASSALL population growth, demographic characteristics and the property market GROVE and comprises the suburbs of Blacktown, Kings Park, Marayong and Woodcroft.

09 DEAN PARK

Key residential demand drivers comprise proximity and access to employment, OAKHURST public transport, services, recreation and social infrastructure as well as population growth and infrastructure investment. These drivers relative to the Blacktown area are assessed within this Market Outlook.

The Blacktown Area is conveniently located in the Western Sydney Growth Corridor. The Blacktown CBD is a major commercial and administrative centre PLUMPTON providing employment opportunities for local residents. Transport connectivity within Blacktown is strong with an extensive network of train and bus services running from the Blacktown Transport Interchange. This connects residents to major employment hubs such as the Sydney and Parramatta CBDs.

Western Sydney University (WSU) is a leading university and has nearby campuses in Westmead, Parramatta, Nirimba and Penrith. An extensive network of primary and secondary schools serve the local population.

Blacktown boasts significant open space and outdoor recreation facilities for residents. Fairwater comprises 9.5 hectares of open space comprising parks, children’s playgrounds, waterways and cycleways. The Western Sydney Parklands starts in Blacktown and comprises over 5,280 hectares of open space. Wet’n’Wild Sydney is located nearby in Prospect and Featherdale Wildlife Park is located 2km to the west in Doonside. The Blacktown International Sports Park is located in nearby Eastern Creek and provides world class sporting facilities to residents. The Leo Kelly Blacktown Arts Centre is the cultural hub of the region and is complemented by Max Webber Library.

03

IP PKY

WOODCROF

NU R R AG I N G Y RE S ER V E

PHILL

Westpoint Blacktown is a major regional shopping centre and comprises leading retailers such as Myer, Woolworths, Aldi, Coles, Target, Big W and Hoyts Cinemas. Smaller retail centres include Blacktown Mega Centre, Woodcroft Village and Kings Langley Shopping Centre.

GLENDENNING

27

Doonside DOONSIDE

1.8km

37

33 W E S TE R N SY D NE Y PA R K L A N DS

ARNDE PAR

HUNTING

Blacktown will benefit from the development of the Western Sydney Airport, which is located south-west of Blacktown. Blacktown residents and businesses will benefit from improved international connectivity and business investment.

RETAIL AND ENTERTAINMENT 01 Westpoint Blacktown 02 Blacktown Mega Centre 03 Woodcroft Village 04 Seven Hills Plaza 05 Kings Langley Shopping Centre EDUCATION 06 University of Sydney – Westmead Campus 07 Western Sydney University – Westmead Campus 08 Western Sydney University – Parramatta Campus 09 Western Sydney University – Nirimba Campus

1

Market Outlook Blacktown

Blacktown residents have access to an extensive range of health facilities including Blacktown Hospital and the nearby globally recognised Westmead Health Precinct.

DW

OL

Quakers Hill

SO IND

ACACIA GARDENS

RR

GLENWOOD

D D LV

KINGS PARK

35 MARAYONG 24 21

05

Marayong

N KINGS LANGLEY

19 18

BAULKHAM HILLS

39

14

34

31

40

Fairwater

FT

BELLA VISTA

TB ES W OR

5.7km

15

23

LALOR PARK

32

RD

Y

W

ABBOTT

MT

41

S LL

HI

42

38 20

01 BLACKTOWN

16

43

44

10 22 25

26 02

13

ELL RK

N RD

12

BLACKTOW

11

WALL PARK AVE

17

GWOOD

PROSPECT

04

Seven Hills SEVEN HILLS

WINSTON HILL

Toongabbie

TOONGABBIE

GIRRAWEEN

OLD TOONGABBIE

36

TAFE Blacktown Blacktown South Public School Mitchell High School Tyndale Christian School Blacktown Girls High School Blacktown Boys High School St Patrick’s Primary School Nagle College Marayong South Primary School Marayong Public School Blacktown West Public School St Andrew's Primary School Patrician Brothers College St Bernadette's Primary School

28

0.5km

30

0.5km

06

0.5km

07 29

Pendle Hill PENDLE HILL

10 11 12 13 14 15 16 17 18 19 20 21 22 23

0.5km

4.0km

08

Wentworthville

24 St Andrew's College Senior Campus 25 Coreen Public School HEALTH 26 Blacktown Hospital 27 Mount Druitt Hospital 28 Westmead Children’s Hospital 29 Westmead Private Hospital 30 Westmead Hospital 31 Norwest Private Hospital 32 Blacktown Family Medical Centre PARKS AND RECREATION 33 Western Sydney Parklands 34 Fairwater Park

35 36 37 38 39 40 41 42

Harvey Park Wet’n’Wild Sydney Blacktown International Sports Park Featherdale Wildlife Park Lynwood Park Allen Robertson Reserve Francis Park Playgrounds Blacktown Showground

CULTURAL FACILITIES 43 Leo Kelly Blacktown Arts Centre 44 Max Webber Library Train station

Prepared exclusively for Frasers Property

2

EMPLOYMENT, EDUCATION & INFRASTRUCTURE

Blacktown is a key employment hub in the Western Sydney Growth Corridor

EMPLOYMENT NODES

EDUCATION

The Blacktown CBD is a major commercial centre and home to a range of government offices. The centre is projected to continue to grow with the NSW Government projecting an additional 5,700 jobs to be created from 2016 to 2036 supported by the CBD transformation, Warrick Lane development and new Australian Catholic University (ACU) campus.

Leading universities and schools are continuing to expand their operations in the fast growing Western Sydney region with direct access by rail from Blacktown. Western Sydney University (WSU) has a strong presence in the region with campuses located in Westmead, Parramatta, Nirimba and Penrith. WSU has strong undergraduate programs in Business, Education and Nursing.

The NSW Government has identified Parramatta as Sydney’s second CBD, which is easily accessible from Blacktown by train. The Parramatta CBD is attracting considerable commercial development, which includes major businesses and government agencies relocating to Parramatta, creating local job opportunities. In addition the University of Sydney is investigating opportunities to develop a major new campus nearby at Westmead, which would generate new jobs.

Other nearby employment centres include the Norwest Business Park, Sydney Olympic Park and Sydney Business Park, which are all accessible from Blacktown.

Employment growth is an important driver of residential demand with workers looking to live close to their work.

Forecast employment growth in nearby centres has the potential to drive housing demand from new workers.

EMPLOYMENT GROWTH WITHIN THE SURROUNDING CENTRES - 2036

13,600 jobs 6,000 jobs Penrith

Norwest Business Park

5,700 jobs

Blacktown CBD

10,300 jobs

Westmead Health Precinct

28,000 jobs

Western Sydney Aerotropolis

Source: Bureau of Transport and Statistics; Urbis

25,800 jobs

Parramatta CBD

The ACU in conjunction with Blacktown City Council will develop a new $50 million university campus within the Blacktown CBD. The permanent campus is proposed to open in 2024 and increase educational opportunities to Blacktown residents.

The University of Sydney is also investigating opportunities to develop a major new campus nearby, at Westmead on the site of the old Cumberland Hospital with potential for 25,000 students.

INFRASTRUCTURE INVESTMENT 01 WESTERN SYDNEY AIRPORT (2026) $5.3 billion

The construction of the Western Sydney Airport in Badgerys Creek is anticipated to serve 13 million passengers annually and create 28,000 jobs by 2031. The international airport will act as a catalyst for economic growth in Western Sydney by providing jobs for locals and enhancing connectivity to world economies.

02 BLACKTOWN HOSPITAL REDEVELOPMENT STAGE 2 (2020) $632 million

Stage 2 of the Blacktown Hospital Redevelopment will add a new emergency department with capacity for more beds. A new intensive care unit will also be created along with eight new operating theatres. The development will be complemented by 420 new parking spaces and will help boost jobs in the region.

03 BLACKTOWN INTERNATIONAL SPORTSPARK AND INTERNATIONAL CENTRE FOR TRAINING EXCELLENCE (2022) $100 million A high performance training center, including accommodation, public square, food and beverage facilities.

3

Market Outlook Blacktown

04 WARRICK LANE DEVELOPMENT – STAGE 1 (2021) $77 million

A mixed-use precinct with a public plaza and retail and commercial development. The development is part of the wider Blacktown CBD transformation.

POPULATION & DEMOGRAPHICS

The Blacktown Area is a growing area with projected population growth of 1.7% per annum over the next 20 years.

The Blacktown Area has recorded population growth of 1.2% per annum between 2011 and 2018, adding over 5,400 new residents. The population for Blacktown is forecast to grow at a rate of 1.7% per annum over the next 20 years, adding an extra 26,600 residents. Forecast growth is above the Metropolitan Sydney average of 1.6% over the next 20 years.

Population growth is projected to be driven by increased apartment development around the Blacktown CBD and job creation in the region. The average per capita income in the Blacktown area was $39,683 in 2016, which is in line with the Metropolitan Sydney average of $40,200.

BLACKTOWN AREA POPULATION Projected

100k 80k 60k

ERP

40k

2011

2016

Average Age of Residents

35.4

35.0

Born Overseas

47%

50%

Living in a House

75%

74%

Average Household Size

2.9

3.1

Managers and Professionals

25%

27%

Bachelor’s degree or Higher

19%

23%

Renters

32%

38%

Average per Capita Income

$36,597

$39,683

Prepared by Urbis; Source ABS Census 2016

20k 0 2011

WHO LIVES IN BLACKTOWN AREA?

HOUSEHOLD INCOME GROWTH, 2011-2016 2018

2023

2028

2033

2038

Source: ABS, Bureau of Transport and Statistics

The Blacktown Area boasts a multicultural, increasingly affluent and educated population. With half of all residents born overseas, and a decreasing average age of residents, there is a growing pool of potential tenants.

This trend is reflected by 38% of the population renting in 2016, which is above the Sydney average of 36%.

Residents are becoming more educated as 23% of the population in 2016 held a bachelor’s degree or higher compared to 19% in 2011. Average household income has grown strongly at 3.9% per annum over the last 10 years.

Over the last five years household income growth of 3.4% per annum has exceeded the Sydney average of 2.4%.

3.4%

Blacktown Area

2.4%

Sydney

Prepared by Urbis; Source ABS Census 2016

BLACKTOWN AREA AVERAGE HOUSEHOLD INCOME

$91,219 $61,954

2006

$77,173

2011

2016

Prepared by Urbis; Source ABS Census 2016

Prepared exclusively for Frasers Property

4

RESIDENTIAL ANALYSIS

The growing workforce and infrastructure investment are projected to support increased housing development in the Blacktown Area.

FUTURE HOUSING DEVELOPMENT IN THE BLACKTOWN AREA

BLACKTOWN HOUSING MARKET The population of the Blacktown Area is forecast to grow to over 95,000 people by 2038. This population growth will require an extra 8,500 dwellings to house new residents. The Blacktown Area has historically been dominated by separate houses with around three-quarters of residents living in a house in 2016.

The proportion has remained relatively steady in contrast to Metropolitan Sydney, which has recorded an increase in apartments over recent years.

541

Under Construction

Total 2,917 FUTURE HOUSING DEVELOPMENT BY PRODUCT TYPE

2,566

Apartment

2011

2016

House

75%

74%

61%

57%

Townhouse

14%

15%

13%

14%

Apartment

11%

11%

26%

28%

The chart compares the relative pricing of new two bedroom dwellings in Fairwater to new high density apartment development in the surrounding region. The prices for new two bedroom dwellings within Fairwater range from $567,000 to $699,000 and are generally lower when compared to new two bedroom apartments in nearby locations and highlights the relative affordability of Fairwater. The price ranges are based on advertised prices as at June 2019. It is noted that the size and characteristics of apartments differ between projects and caution should be taken when comparing prices.

The prices for new four bedroom dwellings within Fairwater range from $843,000 to $1,101,000 and are generally lower when compared to new three bedroom apartments in nearby locations such as Parramatta.

Source: ABS Census 2016; Urbis

$700k $600k $500k $400k $300k $200k $100k $0

$1,200k $1,000k $800k $600k

Ju Den-0 9 Juc-09 Den-10 Juc-10 Den-11 Ju c-11 Den-12 Juc-12 Den-13 Ju c-13 Den-14 Juc-14 Den-15 Juc-15 Den-16 Juc-16 Den-17 Ju c-17 Den-18 Juc-18 n19

Sales

250 200 150 100 50 0

PRICE COMPARISON – TWO BEDROOM DWELLINGS Median Sale Price

BLACKTOWN AREA HOUSING MARKET No. of Transactions Median Sale Price

Townhouse

During early 2019, the Blacktown Area has recorded a median house price of $651,000 based on 165 settled transactions (excluding recent off-the-plan sales that have not settled). House prices recorded significant growth from 2012 to 2017 before softening in the last two years in line with the wider Metropolitan Sydney trend. Despite the recent slowdown, median house price growth has been strong with an average annual price growth of 6.7% in the past 10 years, in line with the Metropolitan Sydney average.

Sydney

2016

351

Note: Projects that have lodged a development application Prepared by Urbis; Source Cordell Connect

BLACKTOWN AREA DWELLING STRUCTURE 2011

Dwelling Application

Dwelling Approval

Note: Projects that have lodged a development application Prepared by Urbis; Source Cordell Connect

In more recent years, apartment developers have been attracted to Blacktown by the accessible location and proximity to employment and amenity. Data compiled by Cordell Connect as of June 2019 indicates that there are an estimated 2,917 dwellings proposed to be developed.

Around 540 dwellings are under construction with the majority of apartment projects still in the planning stages indicating some uncertainty on when they will be developed. An estimated 88% of the pipeline comprises apartments while the remaining 12% comprise new houses and townhouses, indicating the supply of new townhouse projects in close proximity to the Blacktown CBD is limited. Future infrastructure investment is expected to keep the supply of new dwellings strong in the Blacktown Area.

Blacktown Area

210

2,166

Source: APM PriceFinder; Urbis *Note: Off the plan sales that have not settled are not included in the chart.

5

Market Outlook Blacktown

Source: Fairwater prices provided by Frasers Property; Other prices sourced from Urbis Apartment Essentials and agents

RENTAL ANALYSIS

The Blacktown Area rental market has performed strongly over the last decade with rental growth and relatively high rental yields.

The Blacktown Area continues to provide strong rental demand for investors as illustrated by the increase in the proportion of renters. As of 2016, 38% of residents in the Blacktown area are renting compared to 36% for wider Sydney.

From 2011 and 2016, the proportion of renters increased six percentage points, which reflects the attractiveness of the area to renters with proximity to retail, entertainment, employment, schools and other amenity.

The Blacktown Area recorded a strong gross rental yield of 3.3% in December 2018. The gross rental yield is above the Metropolitan Sydney average of 3.0%, which reflects the attractiveness of the area and the relatively strong rents.

PROPORTION OF HOUSEHOLDS RENTING Prepared by Urbis; Source ABS Census 2016

SQM Research data highlights the two postcodes in the Blacktown area recorded an average vacancy rate of 3.2% in June 2019. With Sydney recording a vacancy rate of 3.5%, the Blacktown Area is in line with the broader market in absorbing new rental supply. The recent spike in the vacancy rate for Blacktown is due to the large volume of completed apartments entering the market and being absorbed.

JUNE 2019 VACANCY RATE

3.2%

3.5%

Blacktown Area

Sydney

SYDNEY

EA

BL

Prepared by Urbis; Source SQM Research

KTOWN AR AC

32% 38%

2011 2016

32% 36%

2011 2016

DECEMBER 2018 RENTAL YIELD – HOUSES Prepared by Urbis; Source APM PriceFinder

3.3%

3.0%

Blacktown Area

Sydney

In December 2018, the median rent for 3-bedroom houses across the Blacktown Area was $430 per week.

Rents have stabilised in the last 12 months as supply completions in Sydney have increased. Over the past 10 years, this equates to a median rental increase of 3.4% per annum.

3 BEDROOM HOUSE RENTAL GROWTH – WEEKLY MEDIAN

$430 3 Bed

$450 $350

Dec-18

Dec-17

Dec-16

Dec-15

Dec-14

Dec-13

Dec-12

Dec-11

Dec-10

Dec-09

Dec-08

Dec-07

Dec-06

Dec-05

Dec-04

$250

SUMMARY The Blacktown Area is located in the Western Sydney Growth Corridor and is well serviced by public transport, infrastructure and amenity. It is home to an increasingly affluent and educated population with average household income growing at a rate of 3.9% for the last 10 years.

The increasing pool of more affluent renters in the Blacktown Area is supporting a strong rental market that is recording rental growth of 3.4% per annum and a strong rental yield of 3.3%.

Infrastructure investment in the region will improve amenity to residents and generate new employment. The redevelopment of Blacktown Hospital will add a significant amount of new facilities and contribute to the high job growth expected in the sector. The Western Sydney Airport will connect Western Sydney to global economies and further support job creation. In addition, the new ACU campus in the Blacktown CBD will increase access to education and create jobs.

Despite the strong access to infrastructure, jobs and amenity in Blacktown, the residential market is relatively affordable as evidenced by two bedroom homes in Fairwater priced cheaper than two-bedroom apartments in nearby centres.

Source: NSW Housing, Urbis

Prepared exclusively for Frasers Property

6

P0011774

This publication is prepared on the instruction of Frasers Property 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 Frasers Property 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.