The Surat Basin --Australia's Clean Energy Capital
A wave of transformation is breathing life and economic vibrancy into regional centres across the country, with around $270bn in energy projects currently planned or underway.
All of this activity in the resources sector is igniting a property boom in hub towns such as Chinchilla, Roma and Miles in the Surat Basin, and savvy property investors are set to benefit.
These billion-dollar projects are designed to help meet the soaring global demand for liquefied natural gas (LNG), the emerging clean placement fuel for coal, and coal itself.
This demand is coming predominantly from international export destinations in Asia, and more specifically China, which is experiencing the largest mass urbanization in history.
Infrastructure hot-spotting expert Flynn De Freitas from Omega Investments predicts that over the next ten years, the number of large or tiered cities in China will increase by 37, to 143 cities of at least a million people.
Clearly, international demand -- along with Australia's own domestic energy needs -- isn't expected to slow any time soon.
While all of this activity is all good news for the Australian economy, it also represents an once-in-a-lifetime opportunity for property investors to secure high rents and strong capital growth in one hit.
De Freitas has been charting the property prospects of the Surat Basin for some time, and he believes the local real estate market offers strong returns to investors willing to take the plunge.
"The unique and vital nature of the energy industry presents property investors with an opportunity to invest in Australia's new energy towns," he says.
"These are towns where a social contract between the energy industry, government and local communities means that the billions of dollars in infrastructure investment by the energy industry is matched by millions of dollars in government social investment in local communities."
De Freitas says these social investments makes these communities more liveable and attractive for workers within the energy industry, which ultimately ensures that property investors enjoy sustainable, long term property growth -- thereby avoiding the boom/bust risks of mining boom towns.
The Surat Basin has been dubbed by some as Australia's future energy hub, with the emerging Energy Town of Chinchilla set to benefit from an impressive array of planned infrastructure projects worth billions of dollars.
Two of the largest infrastructure projects in the Surat Basin are the $15bn Queensland Curtis Island Liquefied Natural Gas (QCLNG) and the $20bn Australia Pacific Liquefied Natural Gas (APLNL) projects, which have both commenced construction.
They will involve a peak construction workforce of 6,500 in the Chinchilla region, dropping to a low of 1,400 over a four-year period.
"The Chinchilla property market has already been richly rewarded by the energy industry, with the 2004-2006 construction 25km away of the Kogan Creek Power Station, which entailed 1,000 construction workers and 300 operational workers, virtually all located in Chinchilla," he says.
"This $1.2bn energy project saw annual median property values rise by over 20% for three straight years... and contributed to the 11.9% average annual growth rate over the last 10 years to 2011."
De Freitas says these phenomenal growth rates "all now look to be superseded" by the QCLNG and APLNG projects.
"Given the impact of one single $1.2bn project, the next decade of growth for Chinchill's property market looks very favourable indeed."
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