Property Market Profile - Cairns
Cairns is the most northern located city in Queensland located approximately 1,700kms by road north of Brisbane. Cairns is located within close proximity to the Great Barrier Reef and has a significant tourism industry being a popular destination for domestic and international travellers. Other surrounding natural tourist attractions include the Daintree Rainforest, Atherton Tablelands, Crater Lakes, and Northern Beaches to Port Douglas. The Great Barrier Reef Marine Park and the Wet Tropics Rainforest are both World Heritage listed.
The Cairns airport has a domestic and international terminal, and is listed as the 7th largest airport in Australia with over 4 million passengers (excl. transit passengers) arriving in the year ending June 2013. Trends for passenger numbers over the past few years has been increasing through the domestic terminal, but falling passenger numbers through the international terminal.
The local Government area is the Cairns Regional Council which extends from Babinda to the south up to Palm Cove to the north. The Cairns Regional Council covers an area of 1,689 square kilometres and in 2012 there was an official estimated (adjusted) resident population of 154,040.
The tourism industry is significant in Cairns and has a flow on effect to other service-based industries. Transport, Postal and Warehousing; Accommodation and Food Services; and Health Care and Social Assistance Industries make up a high proportion of total production in the local economy.
The local economy has been affected from the Global Financial Crisis in recent years combined with the high $AUD; which has impacted particularly on international tourism expenditure in the locality. The significant tourism industry means that the local economy can be significantly affected by domestic and international economic cycles. 2013 saw what appeared to be the start of the turnaround in the local economy with visitor numbers increasing, business confidence increasing, expenditure and planned new projects and housing sales increasing. The fall in the Australian dollar which occurred in late 2013 appears, among many other factors, to be having a positive influence on the local economy.
Population and Demographics
Cairns Regional Council Population (including the now de-amalgamated Douglas Shire) as at 30 June 2012 was 165,338 which was a 1.98% increase on the previous year’s estimated resident population. Over the past 10 years Cairns population has grown on average by 2.9% per annum year on year terms.
In the year ending 30th June 2012, Queensland’s population grew by an estimated 1.9% and the National level was recorded at 1.6%.
In comparison to the whole of regional QLD, Cairns has a higher percentage of population between the ages 30 to 39; and a lower percentage of population between 65 and 74. People aged between 35 to 49 make up the largest age group (at 23.4%) living in the Cairns and Douglas region, compared to the QLD Regional statistics of 21% of persons in the same age group.
The population in Cairns can be described as a somewhat transient population with many expats being drawn to the area; and many people migrating to the Cairns Region for contract works with numbers varying depending upon fluctuations in the local economy.
Tourism related serviced-base sectors make up a significant portion of total production for the region. Tourism’s current annual value for the region is estimated to be $2.6 Billion AUD. Cairns Regional Council cites Cairns as being the third most popular Australian tourist destination for international visitors, and the first most popular Australian destination for Japanese visitors.
Transport, Postal & Warehousing; Accommodation and Food Services; Health Care and Social Assistance; and Retail Trade are the largest industry sector contributors to Cairns Regional Council value added production which all provide a greater portion to overall production in comparison to the Queensland proportions by Industry Sector.
The Mining and Agriculture Industries are listed as providing only a small contribution to total production for the Cairns Regional Council. It should however be noted that Cairns acts as a service base for various located Mining activity operations in Far North Queensland and increasingly as a service centre for mining activity out of Papa New Guinea. Cairns also acts as a major service centre and port servicing surrounding agriculture activities in the Cassowary Coast region and in the Mareeba / Atherton Tablelands.
Total Gross Regional Product was recorded as $3,113 million AUD as at June 2012, showing an increase of 2.0% above the corresponding period for the previous year. This increase was a positive turnaround after 3 successive annual decreases in recorded GRP for the locality. Over the same 12 month period ending 30 June 2012 for the whole of Queensland GRP rose by 3.1%.
The Far North Queensland unemployment rate has seen high volatility in recent times due to recording factors and seasonal trends. The unemployment rate for Far North Queensland as published by the Australia Bureau of Statistics has been hovering between 8% and 10% over the past 3 years; which is down from the rates seen in 2009 which hovered between 10% and 12%. The unemployment rate for Cairns is lower in respect to the Far North Queensland rate, and peaked around 10% in 2009 and has subsequently fallen with the current annual rate hovering around 7-8%. Overall the unemployment rate remains relatively high in comparison to the rate for Queensland which currently sits around 6%.
Health Care and Social assistance; retail trade and Transport, Postal and Warehousing make up the largest Industry sectors by employment for the Cairns Regional Council area. The Mining and Agriculture Industry Sectors have a significantly lower employment ratios for Cairns compared to Queensland as a whole, however it should be noted that Cairns acts as a freight, service and corporate base for many mining and agricultural operations.
Travel and Accommodation
The Cairns Regional Council estimates that 2,000,000 people visit the region every year. Tourism is the major economic industry for the locality. Many of the visitors to the locality are tourists visiting the Great Barrier Reef. While number of visitors to the Great Barrier Reef have been falling since their peak in 2004-2005; the last 2 financial years have seen tourist numbers increase slightly from the lull of 2010-2011, as shown by the Australian Governments Great Barrier Reef Marine Park Authority website data.
Occupancy rates, Room Rates and Revenue Rates per average rooms in hotels in the Far North Queensland region suffered during the fall-out of the GFC; but have slowly been increasing back to pre-GFC levels and Deloitte Access Economics predict that Revenues PAR trend will be positive in the coming few years.
There are various major projects for the Cairns region in the pipeline. By far the most significant proposed project is the development of Aquis Resort at Yorkeys Knob; one of Cairns northern beaches. The proposed development is a $4.2 Billion AUD project with a planned start date of 2015 and planned completion date for 2019. The developer has obtained an option on a significant size vacant site (used for sugar plantations), has contracted to purchase the existing Cairns Reef Casino, and is seeking appropriate approvals to extend the casino licence to the proposed Yorkeys Knob development.
The resort, if successfully completed, will be the largest resort of its kind in Australia and the proposal contains the following:
- ♦ 3,750 hotel rooms;
- ♦ 1,180 managed apartments;
- ♦ 130 managed villas;
- ♦ an international casino;
- ♦ one of the worlds largest aquariums;
- ♦ 13,500m² of retail shopping;
- ♦ a 25,000 seat sport stadium
- ♦ a 45,00m² convention and exhibition centre;
- ♦ a 20 hectare reef lagoon;
- ♦ 2 x 2,500 seat theatres;
- ♦ a cultural heritage centre;
- ♦ an 18 hole championship golf course
The developers’ projected economic benefits of the project are significant, with the developers estimating that total direct and indirect benefits will be:
- 16,600 full time jobs at peak construction.
- 26,700 full time jobs once operational.
- Annual State payroll tax increased by $31 Million, and GST Taxes increased by $16 Million during operation.
- Gaming taxes and charges will amount to between $95 Million and $280 Million AUD annually.>
The proposed development will likely increase tourism numbers to Cairns, both from domestic and international visitors, and the projected increase in visitor expenditure is estimated to generate over $2 Billion AUD per annum to the local economy. Further information on Aquis can be found at Aquis Great Barrier Reef Resort
Other proposed major projects for the locality include:
Cairns New Aquarium – A $35 Million AUD project due for completion in 2016. The new aquarium will be situated centrally in the Cairns CBD and will provide a significant new tourist attraction for the locality. The proposed new building is a 15 metre high, 3 level, 9,000 square-metre iconic building.
Tobruk Swimming Pool Upgrade – The Tobruk Swimming Pool centre is proposed to undergo a significant upgrade, with local Government pushing for completion for 2015. The projected cost of the development is reported at $22 Million AUD.
Cairns Airport 20 year plan – Approval was granted by the Government in 2013 for the 20 year upgrade to the Cairns airport to facilitate growing passenger numbers in the future. The current upgrade plans have a current day projected cost of $1 Billion AUD.
Cairns Bruce Highway Upgrade – A $150 Million AUD project to upgrade the Bruce Highway between Forrest Gardens and Ray Jones Drive, providing more efficient traffic flow into the CBD from the south – project currently in construction and near to completion.
Mt Emerald Wind Farm – A proposed 75 wind turbine project which if successful will be the largest wind farm in Queensland. The proposed site is approximately 50kms inland from Cairns and will potential generate enough electricity to power 75,000 homes. The estimated cost of the project is $550 Million AUD. Currently in feasibility and assessment stage.
Cairns City Centre Master Plan – Upgrade to Lake Street costing a budgeted $10 Million AUD. Works have commenced on the Lake Street redevelopment in late 2013. City Centre Alive Project.
Sheraton Mirage Resort Port Douglas Refurbishment and Upgrade – The owners of the Sheraton Resort Port Douglas have confirmed that they plan to upgrade the resort, golf course and all of their rooms, commencing in mid-2014. Reported cost projections in the vicinity of $200 Million AUD for the upgrades are unconfirmed at this stage.Read Next