Mackay, Central QLD

This coastal town is located about half way between Cairns & Brisbane, originally a sugar cane town, Mackay now enjoys the diverse benefits of other industries supporting it. Only a 1.5 hour drive from Airlie Beach, the gateway to the Whitsunday Islands, and a 2 hour drive to the thriving hub of the mining activities of the Northern end of the Bowen basin.

Only few regions in the mining industry get to identify themselves, as Bernard Salt would classify, a muscle town. That is, the strength of the industries and services of the town are vital to the efficiency and productivity of the enormous minerals and resources sector that is rapidly expanding all throughout regional QLD. Separating themselves from a “motel town” is something that takes decades of infrastructure investment and smart governing on a local and state level.

The Mackay regional council has a population of just over 120,000 people. With unprecedented growth expected over the next 20 years. It is poised to be one of the largest growth regions by in QLD over the next decade. Mainly attributed to the benefits of the mining industry, people will choose to call Mackay home rather than living in a “motel town” closer to work where lifestyle, education and diversified employment are not comparable to that of a regional centre in many ways.

These factors make what I believe to be a property investor’s haven, especially considering the performance results of many areas across Australia as of late. Mackay is further developing itself as a vital muscle town to a diverse range of expanding, prosperous industries. With new shopping centres opening and expanding, along with educational opportunities, the current economic climate in Mackay is upbeat and making a strong progression towards its goal of being one of the highest growth regions in QLD over the coming decades. In 2009-2010 The Mackay region (Mackay-Isaac-Whitsundays) generated over $18.1 billion in economic value.

In the below Development Register from REDC, there is an outstanding amount of private and government investment to come in the region of Mackay and its surrounds. It appears that a significant amount of development is planned and occurring to achieve the predicted growth levels. The main factor that will hold communities such as Mackay, Emerald & Gladstone back is the slow release of land and developments which will hinder the population growth. Fortunately enough, as is shown below, the Mackay Regional Council are extremely co-operative in ensuring this problem does not exist.

Whilst you could assume that such aggressive levels of land releases could hinder capital growth in a region like Mackay, my opinion is that this won’t be the case. Mackay will continue to have a sustained, long term future when it comes to housing. Capital growth will be the envy of many property investors around Australia, whilst rental yields should get stronger. As an investor, you need to recognise the importance of a region like Mackay and invest for its security and long term growth that it will provide. It does not provide an investor with the rental yields seen further inland like Moranbah and Dysart, if it did, you would not see so much economic and infrastructure development that helps sustain and take Mackay in to the future. Muscle towns must provide affordable, quality housing to people, that’s why it’s a muscle town.

People use, and will continue to use Mackay as a home town. Many will bus or drive in from the mines in the north of the Bowen basin for their shifts, and returning home to spend their pay cheques. As Mackay provides a lot of the trades, services and equipment to the Northern Bowen Basin, the jobs in this sector will grow massively in the coming years, providing direct employment within the mining industry whilst living and working in MacKay. Couple this along with enormous external economic contributions that the mining sector provide to the rest of the economy, it is not hard to see how and why Mackay is poised for unprecedented growth in the coming decades.

As a property investor, I take the view that Mackay is a place for long term buying in order to capitalise on continuous growth in housing prices. Whilst holding property there, you should find yourself fairly close to being neutrally geared (after tax) at capital value for the first couple of years until CPI takes you into positively geared territory. Whilst on a local level, “rents are rising dramatically”, this seems to be at a more subdued pace than other mining regions. However, over the next 5 years as we see many of the below projects begin construction; a large reliance will fall on Mackay to provide the goods and services to make all this possible.

When it comes to areas for investing, the Northern side of Mackay is where a lot of the current development is occurring, with a little bit to the west. However, for a simplistic approach, I believe that the Northern beaches areas and towards the CBD will be the most popular places to live as they provide proximity to all Mackay has to offer with the beach lifestyle to the North. However, I don’t think that capital growth will differ that much within the different regions as the population growth will put significant demand on the housing market and no matter what property you have, there will be a need for it. 

MACKAY POPULATION GROWTH

 MACKAY REGION POPULATION GROWTH

DEVELOPMENT REGISTER (www.redc.com.au)

PROJECT NAME	DETAILS	PROPONENT	EST. COST (M)	TIMING		STATUS
AGRIBUSINESS
Cogeneration plant	Construction of a 36MW cogeneration plant at racecourse Mill	Mackay Sugar Pty Ltd	$120	10’-13’		In progress
Ethanol Project	Installation of a 600ML pa fuel ethanol plant at racecourse mill	Mackay Sugar	$85	2015 (completion)		Not started
Sarina Distillery Upgrade	Fuel-grade ethanol production to be upgraded from 38 million litres to 60m litres a year at Sucragen distillery Sarina	Conneq Infrastructure Services Aust	$18	08-09		completed
TOTAL  AGRIBUSINESS			$223
COMMUNITY INFRASTRUCTURE
Botanic Gardens Upgrade	Redevelopment of Mackay Botanical Gardens including developments of an outdoor performance centre	Mackay regional council	$13	11’-12’		Not started
Mackay Base Hospital Redevelopment	New 3 story hospital on current site, able to accommodate up to 318 new beds. New emergency and outpatients departments, renal support services, day oncology, dental services unit, birthing and delivery suites, special care nursery, ICU.	QLD health	$405	09-13		In progress
Mackay Showgrounds Upgrade	New and improved facilites at showground	Mackay Show Assoc.	$10	2011		Not started
Mackay Sports stadium	Sports stadium for Rugby League games. The stadium will hold 15,000 spectators	Woollam Constructions	$11	07-11		In progress
Ooralea Racetrack Redevelopment	Redevelopment of Racecourse into a top-class racing and community venue	Mackay Turf Club	$18			Not started
COMMUNITY INF. TOTAL			$457
CONSTRUCTION
Andergrove Urban Development Area	Up to 180 lots on site, quality affordable housing	Urban Land Development Authority	$4.2		11’-12’	In Progress
Andergrove UDA – stages 2-3	Development approval for 41 residential lots on Bedford road, Andergrove	ULDA	$4.8		2010	Not started
Blacks beach Cove	Housing development in Blacks beach. 850 site, 350 developed so far	Private developer	$60		09’- current	In Progress
Breezes Retirement Resort	Residents community centre, over 50’s lifestyle village with 221 two and three bed villas. Stage 1 = 206 homes and 11 apartment	Becton Property Group			07-11	In Progress
Bunnings Warehouse	Proposed hardware store for Holts Road, Richmond	Bunnings Warehouse			2010	Not started
East Point	Integrated development including an international standard hotel, apartment complex, resort villas, retirement villas, retirement village, shopping village, residential lots and a cultural centre – 250 rooms	Eastpoint Mackay Pty Ltd	$150		12’-20’	In Progress
Glenrowan residential estate	340 lots, built in stages, stage 1 and 3A developed and sold with houses built. AV Jennings now doing balance of stages 2-9	AV JENNINGS Mackay Pty Ltd	$34		07-current	In Progress
Inspire CBD	Office precinct, retail. 149 room hotel and 130 residential unit and townhouse development	Pointglen developments	$170			Not started
Leichardt on river	11 story mixed use development comprising dual key, residential apartments and restaurants – 168 rooms total	Martinek Pty Ltd	$35			Not started
Nabilla meadows	500 lot subdivision at Marian	Pointglen developments	$20		10’	In Progress
NB services	5 warehouses and offices for “service” industry use	Gros-Dubois	$2.5			Not started
Pacific Parks Estate	9 stage development with parklands, open spaces, rec facilities, high and low density	Pacific property developers			07-10’	In progress
Parklands Estate	Refurbishment and development of buildings to accommodate mixed residential, commercial and retail uses	Nebo Rd Pty Ltd	$102			Not started
Pioneer lakes	Stages 1-8 33 residential lots with further exoansion to include another 170 lots. Stage seven will include 173 retirement villas. Also industrial and childcare	Pioneer lakes pty ltd			09	In progress
Plantation Palms	2000 residential lot estate in the Northern beaches. 60% parkland.	Xcel properties	$1,500		07-20’	In progress
Richmond Hills	500 lot residential subdivision	Pointglen developments	$200			Not started
Settlers Rise	100hectare masterplanned 12 stage community	Cougar Development	$120		2011-	In progress
Shoal Point Waters	Small tourism precinct with commercial facilites, high & low density residential developments. Over 1000 alotments	Pointglen developments	$600		01’-11	In progress
The Beach	Four stage residential development	Pacific coast developments	$200		07’-	In Progress
The Pier	2 residential towers, restaurants & Boardwalk. 54 apartments		$87		07-	In Progress
The Waters @ Ooralea	236ha housing estate including 250 retirement dwellings. 10,000sqm commercial and 2321 house and unit sites	Cougar developments	$80			In Progress
Town beach Dev.	Tourism/res. 266 units, 15 houses, retail	Pointglen dev.	$150			Not started
Universal Self Storage	Self storage facility	Pilot Group	$4			Not started
WaterFront Landing	9 story residential complex. 41 units	JD Dodds	$35			Not started
TOTAL CONSTRUCT			$3,558.5
MANUFACTURING/INDUSTRY
Evolution Paget Industrial Estate	242,073 SQM industrial. 41 lots. High impact industry zoning	Mirvac & ICPS	$200		08’ -	In Progress
Harbour City Central	32 Industrial sheds/office development	Res. Dev. Mackay	$20		08-11	In Progress
Industroplex	Industrial Estate stages 5 and 6	FKP Property	$40		11-12’	Not started
South Mackay Industrial Estate	Major industrial estate	QLD dept infrastructure and planning	$7		08’-	In Progress
TOTAL MAN./IND.			$267
PORTS (AIR & SEA)
Dalrymple Bay Coal Terminal 9X	Construction of another 2 berths, 2 rail recieveal routes and new stockyards	North QLD Bulk Ports Corporation				Not Started
Dalrymple Bay Coal Terminal 8X	Work on existing yards	NQBPC	$1,000		09-18’	Not started
Dudgeon Point Coal Terminals	3 new coal terminals to join Dalrymple bay and hay point. Expanded port will export between 250 – 300 mtpa	NQBPC	$8,000		2013	Not started
Hay point coal terminal expansion	Port capacity to increase from 44mtpa to 55mtpa	BHP/Mitsubishi alliance	$2,340			In progress
Mackay marina expansion stage 4	Stage 4 planned with approximately 50 more berths	Port Binnli	$8		2010-	Not started
Mackay Airport upgrade	Terminal and runway revamp/upgrade	Mackay Airport	$10		10-100’	Completed
TOTAL PORTS			$11,358
PROFFESIONAL SERVICES
Dentist Training facility	Dental training facility and refurbishment of a 32 unti comples for student accomodation.	James Cool University	$2.57			Not Started
Emmanual Catholic Primary School Expansion	Classrooms and school hall expansions	ECPC	$2.8		09-11	In Progress
GP Super Clinic	Construction of GP super clinic	Aust. Govt.	$7			Not started
Mackay Christian College Campus Dev.	Development of a new primary school campus and a mutli purpose hall	Mackay Christian College	$15		09-11	In Progress
Mackay GP superclinic	Construction of new GP super clinic with 12 rooms, pharmacy, chiropractor, dentist etc	Dr John Mcintosh			10-11	In progress
Mater Hospital Clinical training facility	Construction and fitout of a new 2 story clinical training facility  at the Mater Hospital	James Cook University	$2.6			Not started
SMART centre	Sustainable Mining Automation and Robotic Technologies Centre	CQ University	$42		2012	Not Started
TAFE training centre	Engineering College for apprentices and adult learners	TAFE	$32.5		2012	Not Started
TOTAL PROFFESIONAL			$104.47
RETAIL
Bunnings Warehouse	New bunnings warehouse approved	Wesfarmers	$30			Not started
Canelands Central Expansion	Expansion of existing major retail centre & MYER. From 38,000 SQM to 66,000 SQM.	Lend Lease	$220			In Progress
Dan Murphy Mt Pleasant	Expansion of Mt Pleasant Tavern to include Dan murphy’s store	Dan Murphy	$5			Not started
Homemaker centre	Bulky Goods Homemaker centre	Lancini group	$60			Not started
Marian Town centre	3200sqm supermarket, 1500sqm specialty stores, 36 lot residential subdivision	Tipalea Partners	$38			Not started
Mt Pleasant shopping centre	Expansion to mount pleasan shopping centre	Colonial First State	$50			Not started
Northern beaches central expansion	Stage 2. Woolworths, McDonalds, 17 specialty stores, 3 commercial suites. Bilo will change to coles.	Stockwell Building and Development	$250			In Progress
Orchid valey commercial	Retail convenience centre in Marian	Equitrust	$20			Not Started
The Avenue	Mixed use development	Woollam	$10			In Progress
TOTAL RETAIL			$683
ROADS	Mackay Regional Council & dept. main roads		$407.3
Tourism
Aus south sea islander cultural centre	Diversified tourism attractions including visitor info centre	Mackay Tourism	$6.9			Not Started
Clarion Hotel extension	50 rooms	Clarion hotel Mackay				Not started
Eungalla EDGE Project	Eco resort	Mackay Tourism	$13.2			Not started
Harrup Park country club	70-100 room proposed accomodation	HPCC	$10			Not started
The Beacon	12 story development with 23 x 3 bed apartments	Port Binnli	$30			Not started
TOTAL TOURISM			$60.1
MINING – Incorporating Mackay, Isaac & Whitsunday Regional Councils
Anthony Molybdenum Open Cut mine	Isaac regional Council (IRC)	Zamia metals	$200		2015	Not started
Broadmeadow Underground expansion	IRC	BMA	$850		2013	Not Started
Byerwen Open Cut	IRC – 10mtpa coking coal	Qcoal	$1,500		2013	Not started
Charmichael coal mine – Rail line	IRC – From Charmichle mine to Moranbah to join Goonyella rail system to Hay point.	Adani Mining	$6,900		11-14	Not started
Charmichael Open Cut mine	IRC – up to 60M thermal coal	Adani Mining	$4,100		2014	Not started
Caval ridge mine	IRC – Open cut coal mine (5.5mtpa)	BMA	$4,000		2014	Not started
Codrilla Open Cut mine	IRC - 3.2mtpa PCI & thermal coal	Macarthur Coal	$250			Not started
Daunia Coal Project	IRC – new open cut coking coal and PCI. (4.5mtpa)	BMA	$1,600			Not started
Drake Mine	WRC - Open cut coal mine, 17km south Collinsville	Qcoal	$350			Not started
Eagle downs underground	IRC - New underground mine producing 4.6mtpa coking and PCI coal	Aquilla resources/Vale	$988			Not started
Dysart east open cut & underground mine	4mtpa coking coal mine	Bengal coal Ltd	$450			Not started
Eaglefield downs underground – stage 1	New underground mine producing 6.8mtpa	Peabody	$1,400			Not started
Ellensfield underground coal project	IRC - New underground mine for coking and thermal coal. 4.7mtpa	Vale Australia	$640			Not started
Foxleigh Plains	IRC - Expansion to 3.3mtpa	Anglo American	$620			Not started
Goonyella riverside expansion	IRC - Expansion project to  21mtpa	BMA	$1,000			Not started
Grosvener underground coal	IRC – Construction and operation of new longwall mines. 6.5mtpa coking coal	Anglo American	$1,300			Not started
Isaac Plains Coal	IRC – increase production from 1.9 mtpa to 2.8mtpa	Aquilla	$118			In Progress
Jax open cut mine	WRC - 1.8mt coking coal	Qcoal				Not started
Jellinbah east open cut	IRC – mine expansion/extension to 2mt	Jellingah group	$100			Not started
Lake Vermont	IRC – expansion of lake Vermont mine to 6mt capacity	Lake Vermont resources	$220			Not started
Lenton Open cut	IRC - New mine producing 1.5mtpa coking/thermal	New hope coal	$120			Not started
Middlemount Coal Project	IRC - New open cut mine. 3mtpa	Macarthur	$500			In progress
Millenium open cut expansion	IRC - Expansion of current mine	Peabody	$276			Not started
Moorvale underground expansion	IRC - 2mt coking and PCI	Macarthur	$180			Not started
Moranbah south project	IRC - New underground mine producing 3.5mtpa coking coal	Anglo American	$1,300		Finish 2017	Not started
Mt Carlton open cut	WRC - Copper-Gold-silver mine	Conquest mining	$127			Not started
Newlands Northern underground	IRC - 7.5mtpa thermal coal	NCA JV (Xstrata coal ltd 55%)	$140			In progress
Olive Downs Nth Open cut coal project	IRC - New open cut mine to produce 1mtpa	Macarthur coal	$20			In Progress
Peak downs open cut expansion	IRC - Expansion from 9mtpa to 11.5mtpa	BMA	$1,000			Not started
Saraji East open cut	IRC - New underground mine to produce 5mtpa	BMA	$1,000			Not started
Sarum open cut and underground	WRC - New project to produce 5mtpa	Xstrata	$700			Not started
Talwood	IRC - New mine to produce 2mt PCI & thermal	Aquilla resources				Not started
Twin hills gold-silver	IRC – redevelopment trial mining planned	Conquest	$6			Not started
Wilunga Open cut	IRC – pre-feasability underway	Macarthur				Not started
Winchester sth open cut	IRC – 4mtpa coking and thermal	Rio Tinto				Not started
TOTAL MINING			$30,855
TOTAL INVESTMENT IN MACKAY REGIONAL COUNCIL			$17,118,37

References: REDC & Mackay Regional Council