Yes it was a little bit lower than the previous years, none the less still some growth. Each town fluctuated in its own right during the GFC. the 10% growth so far this year has been great!

Also the investment that happened in the last mining boom is negligible compared to the next 4 years. And look what happened to Emerald than!

Hi Keystrategies,

Thanks for your post its great!

The Bowen Basin has two major service centres. To the south is Emerald and to the North is Mackay. Although that is not where all of the miners live they are the two areas that provide major infrastructure and servicing for the mining and rich agricultural activities throughout the Bowen Basin. There are towns like Dysart, Moranbah, Blackwater, etc that get a large concentrated number of mines wanting to rent out houses. This is great for investors as you have discovered with the purchase of your duplex, you receive such high ROI in way of rents and potential capital growth.

Should the mines impose a 100km radius for workers this would actually have the opposite effect on Emerald than you are thinking. A large number of people that work in the mines in the south of the Bowen Basin live in Rockhampton and Yeppon. This would mean that they would have to move. If this is implemented by some mines, it is not an overall mining industry rule, it will be imposed by certain mines and not all. The mines at alpha for instance wouldnt, or should i say couldnt, impose such regulations as this would mean they would all have to live in Alpha which is impossible due to no infrastructure etc.

As a part of mining recruitment, and as much higher demand appears for skilled employees, many mining companies must offer lifestyle for their workers to encourage longevity. It is common knowledge that the mines do not expect to retain employees on a long term basis when housing them in places with limited infrastructure and lifestyle opportunities.

There are a number of motels in Emerald, many of which are not that old, the demand comes from a number of fly in fly out workforce, however this is quite often due to the service and contracting industries that are based there. As the regional hub for the south of the Bowen basin it also attracts many business visitors which occupy a large percentage of the accommodation.

Emerald has significantly more infrastructure than Blackwater and always will. The international coal centre is basically and information and tour centre for visitors to the area. It was placed there as Blackwater is considered to be the coal mining capital of Australia due to the number of mines around it. Despite this being the case over the last decade at least, Emerald has continued to attract more people, more businesses, more mine offices and more infrastructure than Blackwater. In fact the cafe that opened up at the visitor centre had closed down for a while.

During the last GFC Emerald outshone all of these areas in regards to real estate. Prices did not fall, rents were secure and reasonably steady, and the town continued to prosper during such dire times while other regional centres failed to perform to the level that Emerald did as mines cut funding etc for short periods of time and re-structured. What Emerald positions itself as, is a long term, secure investment which also achieves reasonable rents and good solid capital growth as a large percentage of the population is owner occupiers, hence the lifestyle opportunities and the ability to sustain a family model in this area. If you are looking to hold a property for 10+ years, you would obviously be looking for long term growth and security as a property investor. The likes of Bunnings Warehouse/wesfarmers group, Gerry Harvey, centro, woolworths all seem to be of the same mindset here as they look to secure a presence/and or a larger market share in Emerald. Families move to Emerald for long term employment, education & lifestyle. With a choice of schools, tafes and the Central QLD university positioned in Emerald it provides a family with the ability to raise their children in the region and also provides the infrastructure for the kids to further their education and or employment with a wide array of employment opportunities, not just mining. Many other regional towns cannot offer this so they will continue to be subject to such a transient population. I believe that investing in regional QLD is no just about trying to achieve the highest rent possible, it is the longevity and continued capital growth that many investors also look for.

In regards to chinchilla area, excuse my ignorance on it, which mega-mines were you referring to? there is the wandoan coal project which has the ability to produce a large amount of export coal, I wasn’t aware of other mines that had this export capacity.

I am keen to hear your thoughts on all of this.

GLADSTONE UPDATE

It seems the Gladstone council and QLD State government have come to terms with the social and economic impact of the LNG boom and have accepted the fact that GLNG will house 48% of its total workforce in Gladstone itself, not on Curtis Island as originally planned. I would assume that other companies will follow suit here.

This advancement significantly reduces the risk that was apparent in the local property market with the initial EIS proposal for accommodation.

I thought I would update my findings for you all. I am in negotiations with a few builders here so I will let you know of my outcome to see what investment opportunities come up. Rents are going strong here. For a 4 x 2 x 2 house fully furnished you will achieve $1000 per week easily, with increases every 6 months! That’s a good 10% return pretty much with some strong capital growth in the coming years. None the less, I still believe it is a market that should be watched closely should you decide to invest there.

Josh

Hi shooshoo

I will get you the information for Dysart as soon as I have completed my analysis. In essence what I showed you was proof that Emerald will be the service hub for 4 potential mines which will all individually be nearly the largest coal mines in the world. It provides lifestyle and services that the smaller towns don’t. It may not be for you which is fine.

Dysart is attracting some really great rents, There’s not a lot for sale there as it is small and things all throughout Central QLD are moving fast so keep an eye out for what it is you want and when you see it jump on the opportunity as quickly as you can in those areas.

There are 2 feasibility / pre-feasibility studies underway plus a concept plan for new mines near dysart along with 1 expansion pre-feasibility study underway for lake vermont mine all to the north of Dysart.

To the South there is a $200m new coal mine from middlemount coal with an EIS for the $100m stage 2 expansion. Also Anglo-American are conducting a pre-feasibility study for a new mine in the south.

I haven’t got to their publications yet however if time is of the essence for you check out the following companies:
1. anglocoal.com.au
2. jellinbah.com.au
3. macarthurcoal.com.au
4. bhpbilliton.com.au (saraji mine)

I’ll have all my research done on this shortly (I didn’t make it to Dysart on my Mackay trip however I will be heading there from Emerald shortly) I have been to Dysart numerous times so I do know the area. Everything has been very busy especially dealing with Central QLD markets so I will do my best to have as much information for you as possible as soon as I can.

shooshoo…

here is an exert from the alpha coal projects EIS…

The Project will accommodate the majority of the construction and operational workforce in an on-site accommodation village within the Project boundary. The workforce is anticipated to be predominantly fly in, fly out (FIFO) due to the location and distances to population centres capable of accommodating such a large workforce. The Project will also have drive in, drive out (DIDO) opportunities for some local residents, and bus in, bus out (BIBO) opportunities from key regional centres. FIFO workers will be collected from key regional centres throughout Queensland based on workforce sourcing realities at the time, and flown to Alpha aerodrome for their work rotations. FIFO workers will be bussed to site from the aerodrome and back to the aerodrome after their work rotation. Hancock Prospecting Pty Ltd (HPPL) (the Proponent), prefers to hire locally and regionally but has designed a mainly FIFO project with on-site accommodation in anticipation of the high likelihood workers will need to be sourced outside the region.

hi Josh,

thanks for your response, very appreciated. However, i dont see much difference between the surat basin towns like Chinchilla, and Emerald in the Galilee Basin. Except Emerald has about 10,000 extra population. Chinchilla is also getting a Woolsworth, McDonald’s, etc. How do you know both these towns wont have over supply in the coming years after construction is done on the developments?
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Hi Shooshoo,

In relation to long term operations, coal mining is a lot more labour intensive than Coal Seam Gas industries. Once the plants are operational the workforce that is needed is minimal, also the sub contracting companies and suppliers and services are a lot less than coal mining. With coal mining, they are using machines that breakdown and need new parts etc on a large scale.

This has an impact on these areas long term I believe

Josh