LNG driving office demand

Written on the 11 August 2009

ASTUTE commercial property investors should keep an eye on the state’s LNG industry, with a Jones Lang LaSalle research paper showing positive flow-on effects for office demand from engineering, construction, legal and accounting services.

Research director Leigh Warner says the indirect effects of the $20 billion invested into LNG over the past 18 months will affect the commercial sector more than demand from the sector itself.

“We saw this first hand in Brisbane over the past five years with the coal boom – the actual coal companies’ space requirements paled into insignificance relative to the demand generated from other sectors as a flow-on from the investment and employment created by the coal industry,” says Warner.

“From a longer-term perspective the sector represents a strong opportunity for Queensland to replace the impetus to the Queensland economy that coal provided over the past decade.”

Even if only a quarter of proposed projects go ahead, report co-author Geoff McIntyre says LNG will generate more investment than what the coal industry has in the past five years.

“The strongest indication of the potential of this sector and that at least some of these enormous proposals will proceed, is the enormous investment that several global energy giants have made over the past 18 months in spite of the GFC and a fall in global energy prices,” says McIntyre.

“The coal boom showed how quickly and how strongly investment in resource projects can flow through to property markets. Consequently, astute property investors should keep a watching brief on the CSG (coal seam gas) to LNG sector, where the potential flow-through impact to the real estate sector may be even greater.”

But despite the flow on effects Brisbane’s CBD and fringe office markets have already had almost 25,000sqm of office space commitment from LNG’s key players including Santos, Origin Energy, Arrow Energy and BG International.

The paper concludes that regardless of what happens in the CSG industry, continued strong levels of population growth and public infrastructure investment will underpin a solid longer-term outlook for the state’s economy and property markets.


Latest News

CSIRO HELPS DEVELOP AUSTRALIAN PHARMA COMPANY FROM $10 MILLION TO $305 MILLION

GOVERNMENT backed scientists have helped multiply the market value of a previously small Australian pharmaceutical...

FROM SECOND HAND MOTORCYCLE DEALER TO LEADER OF THE PACK

MOTORCYCLE Holdings (ASX: MTO) founder and managing director David Ahmet (pictured) says he often gets asked wheth...

HOW TO PROTECT YOUR BUSINESS FROM RANSOMWARE

BUSINESS owners are being warned to prepare and protect themselves from the type of ransomware attacks which hit A...

NUFARM SHARES SURGE TO FIVE YEAR HIGH ON BIG TURNAROUND

After a heavy loss in 2015 because of major restructuring, crop protection company Nufarm (ASX: NUF) has swung to ...

Related News

RAY OF HOPE FOR SLATER AND GORDON AS LENDERS STEP IN

EMBATTLED law firm Slater and Gordon (ASX: SGH) has announced to the ASX that it has launched confidential discussion...

SPROUTX PROVIDES THE SEED FOR AGTECH STARTUPS

AGTECH innovation fund SproutX has opened applications for its first accelerator round, backed by $10 million from...

GAS PRICES MAY FORCE BRICKWORKS TO TAKE MANUFACTURING OVERSEAS

BRICKWORKS Limited (ASX:BKW) chairman Robert Millner says soaring energy prices may force the company to turn to offs...

CHINA CONTINUES TO COLLECT AUSSIE PROPERTY ASSETS

CHINESE coin continues to dominate Australia's offshore real estate investment market, accounting for almost h...

EVENTS COMING UP

 

Contact us

Email News Update Sign Up Contact Details
Subscriptions

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter