Pub­li­ca­tions

Con­nec­tiv­i­ty tur­bo charges growth opportunities

Aus­tralia has notched up 103 suc­ces­sive quar­ters of eco­nom­ic growth. It’s 26 years since we had a reces­sion, mak­ing us a glob­al leader in terms of growth.

Growth is impor­tant for any busi­ness, and it’s the lifeblood of the prop­er­ty sector.

There have always been two key pil­lars of prop­er­ty growth; the pop­u­la­tion itself and prox­im­i­ty — to poten­tial employ­ment, schools, edu­ca­tion, hos­pi­tals and gen­er­al ameni­ty. They are now being tur­bo-charged by connectivity.

Syd­ney has, over almost 230 years, spread from its har­bour heart in all direc­tions. Some sub­urbs have always been pop­u­lar, close to schools and the CBD.

Lat­ter­ly though the city has spread west to the Blue Moun­tains, South West to Camp­bell­town and beyond, and now to the bur­geon­ing North West bound­ed by Bel­la Vista, Rouse Hill and Kel­lyville. But these have been cor­ri­dors of devel­op­ment large­ly starved of connectivity.

Today how­ev­er infra­struc­ture invest­ment in the nation­al broad­band net­work, in roads, T-way bus­es, light rail – and the promise of a new air­port at Bad­gerys Creek — is con­nect­ing those cor­ri­dors, stream­lin­ing access to jobs, schools, hos­pi­tals, uni­ver­si­ties. Con­nec­tiv­i­ty is hav­ing a growth mul­ti­pli­er effect on prox­im­i­ty and population.

Sydney’s pop­u­la­tion is tipped to rise to more than 6.4 mil­lion with­in 20 years, and NSW’s to almost 10 mil­lion in a sim­i­lar peri­od, so there’s a fun­da­men­tal num­bers game at play.

Con­nec­tiv­i­ty vast­ly expands the oppor­tu­ni­ties implied by that pop­u­la­tion growth as the pre­vi­ous con­straints around where afford­able hous­ing, or busi­ness parks, or retail out­lets can be locat­ed are erod­ed by improved con­nec­tions, be they phys­i­cal in the form of land trans­port, or vir­tu­al in the form of fast broadband.

Con­sid­er the cumu­la­tive effects. Say a devel­op­er builds afford­able hous­ing close to a new busi­ness park in Sydney’s West, and there are good schools close by. The busi­ness­es that take up res­i­dence will be able to access local tal­ent which will like­ly prove loy­al and sta­ble work­ers if they have their chil­dren in local schools, but enhanced con­nec­tiv­i­ty means that the adults in the house can still choose to work in the CBD assured of a faster com­mute – and good inter­net con­nec­tions on the days they telecommute.

With mum and dad in work, and a finan­cial­ly sta­ble home-life, those chil­dren are far more like­ly to com­plete their school­ing to Year 12. They in turn will seek out work or move onto high­er edu­ca­tion and con­tribute to the over­all growth poten­tial of the State.

Now, say those 18-year olds decide to go to uni­ver­si­ty — because there is good access to pub­lic trans­port they can con­tin­ue to live with their fam­i­ly, get to uni­ver­si­ty eas­i­ly, and still hold down a part time job close to home. The more entre­pre­neur­ial of these young peo­ple may return from their stud­ies and start small busi­ness­es, attract­ed by afford­able rents and access to talent.

In the old­er more estab­lished areas mean­while bet­ter pub­lic trans­port and roads across the State, along with fast broad­band, spur urban regen­er­a­tion and cre­ate fur­ther oppor­tu­ni­ties for the prop­er­ty sector.

And all the time the NSW pop­u­la­tion con­tin­ues to grow, adding to the sup­ply of work­ers, prop­er­ty buy­ers, busi­ness own­ers, and infra­struc­ture users. It’s a growth cycle.

A word of cau­tion though – it’s fol­ly to believe all growth is good. To pro­mote benign, sus­tain­able, healthy growth it’s crit­i­cal that organ­i­sa­tions care­ful­ly analyse all the issues before they invest.

Good growth needs devel­op­ment to be well planned, well con­sid­ered, well deliv­ered. Smart devel­op­ers weigh the pros, iden­ti­fy the cons, seek out good com­mer­cial advice and then they act, assured that they have done every­thing pos­si­ble to ensure good and sus­tained growth.