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Up-market units defying downturn

A Brisbane businessman recently paid $14.25 million for a riverfront penthouse on Mirvac's billion-dollar Waterfront development, smashing the previous Brisbane record by more than $3 million.

The Luxury Apartment Report released today by Colliers International reveals multimillion-dollar, quality designed units are helping Brisbane’s property market defy a national slowdown in sales.

"High end luxury units are outperforming the general market in capital growth," said report author, Colliers International research analyst Alison Timchur.

Queensland's developers and agents report healthy sales to local buyers.

"One thing most buyers have in common is that generally they are Brisbane locals, with the occasional Gold Coast buyer," said Ms Timchur.

Six apartments averaging $6-million each have already sold at Scott Street, a luxury one per floor apartment project under construction in Kangaroo Point – all to locals.

A Waterford Properties development, Scott Street will have open gas fireplaces, 3 or 4 bay garages, home automation with dial-in access, 340 bottle wine cellars, digital surround sound media room, 360 degree motorised blinds installed, heated ensuite floors and concierge.

"With higher price tags come higher expectations," said Ms Timchur.

"Buyers in the $3-Million-plus category demand a higher level of features and amenities including climate controlled wine cellars, private pools, home theatres and heated stone floors," she said.

The first time an apartment sold for more than $3 million was in 1996, when the penthouse of Admiralty Quays in the city transacted for $3,745,000.

"Since that time a further 68 Brisbane apartments have sold and settled for over $3 million, with 21 of these occurring in 2007 alone," said Ms Timchur.

"In addition, at least 30 luxury apartments have sold off-the-plan, with settlements due in the next few years."

 And while there seems to be plenty around, analyst Alison Timchur says the city's top-end apartments achieve record resale prices.

 "In 2002, one of the most expensive units sold in the Brisbane area was Lot 4 at Teneriffe’s Australian Estates Woolstore.

"This particular apartment sold for $2,175,000 – five years later the same apartment resold for $7,125,000 which equates to an incredible 26.3 % per annum growth," she said.

Ms Timchur said there was no "typical buyer" of a luxury apartment.

"While the high buy-in price and the strong lifestyle offerings from luxury projects attract a number of cashed up baby boomers, there are also a number of younger professional couples in their thirties and forties," she said.

Ms Timchur says Brisbane luxury apartments were priced low compared to the record asking prices in southern states.

"A penthouse in Potts Point, Sydney recently sold for a record price of $20 Million. Victoria’s residential apartment price record was also broken last year when a penthouse in East Melbourne achieved $18.2 Million," she said.

"The luxury apartment market in Brisbane has grown dramatically over the past decade, as buyers flock to these prestigious and exclusive dwellings."

Waterford Properties have achieved over $35 million in pre-sales on the Scott Street project at Kangaroo Point despite uncertain economic conditions.

Topping the contracts so far has been a $6.3 million apartment (one of their typical configurations) – which buys a 3-bedroom, 3-bathroom pad spread over an entire floor, with construction due to be completed by early 2010.

Colliers International marketing agent Denise Gustafson said Scott Street apartments should appreciate at a better rate than the general residential market due to its unique position and development form.

"It would be a very difficult form of development to duplicate in Kangaroo Point or most parts of Brisbane in the future," she said.

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