Virtual round table of South Australia’s influential property industry leaders
A plan to hook Earth’s highest flying billionaire’s private space firm for the old RAH site has emerged as Adelaide’s property industry leaders search for new business frontiers.
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Luring Elon Musk’s SpaceX to Adelaide, ultra high-speed internet pockets across the state and regional economic zones are being urged by industry leaders to accelerate recovery from the coronavirus-induced recession.
Influential property sector chiefs surveyed by the Sunday Mail spelled out a series of “big ideas” for reviving the economy, calling for South Australia to capitalise on world-leading success fighting the virus.
Latest figures show housing turnover has declined sharply during the pandemic and building approvals are weakening – down 42 per cent from the cycle’s peak in May 2018.
Hickinbotham Group managing director Michael Hickinbotham said US entrepreneur Mr Musk should be pursued to base at Lot Fourteen the southern hemisphere headquarters of his SpaceX company, which last week launched two NASA astronauts into space.
Mr Musk visited Adelaide in 2017 after his Tesla firm was awarded a deal to build the world’s biggest lithium ion battery in the Mid North.
“Elon Musk knows South Australia well … so, if he based the SpaceX’s southern hemisphere operation in Adelaide, it would be a real game-changer,” said Mr Hickinbotham, who heads the state’s biggest home building firm.
“It would capitalise on the emerging hi-tech hub at Lot Fourteen and South Australia is in a unique position internationally, given we already have a world-class launch facility at Woomera.”
SpaceX did not respond to requests for comment.
Mr Hickinbotham also called for a “migration tsar” to spearhead Premier Steven Marshall’s plan for SA to increase its share of Australia’s population intake.
BankSA chief executive and Westpac general manager SA, NT and WA, Nick Reade, said SA could forge a “technology infrastructure advantage” around the speed and ease of doing business in key pockets around the city and state. This could mirror the GigCity concept that connects firms to ultra-fast and affordable internet in Adelaide, Whyalla and Mt Gambier.
“With housing more affordable and Adelaide having a population that is less dense, the acceleration in working from home could mean more jobs available to South Australians that were previously out of reach,” said Mr Reade, who heads the state’s biggest home lender.
“SA has the opportunity to develop a new global brand focused on health, safety, lifestyle and accessibility. We need to capitalise on these important features to attract more people, which will help address one of the factors that have constrained the long-term potential of SA’s economy – population growth.”
Mr Reade, also a member of the six-person Premier’s Economic Advisory Council, also called for first-home-buyer incentives including deposit guarantees and stamp duty savings on the land component of house and land packages.
He also suggested planning concessions or grants for low-rise development of Adelaide’s fringe. Statistics supplied by Mr Reade show Adelaide home prices have remained resilient yet he said there was a risk of price falls in coming months because of rising unemployment and depressed household incomes.
He said industrial commercial property tended to move with broader commercial activity and this likely would contract until the year’s final quarter, although the logistics sector would outperform because of online spending and might present some opportunities. Mr Hickinbotham and Civil Contractors Federation SA chief executive officer Phillip Sutherland both argued for special economic zones.
Mr Hickinbotham said SA should be designated a special zone with concessional tax rates and migration rules, arguing these had worked well in Asia and Europe.
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Calling for government policy to reflect SA’s “patchwork” of economies, Mr Sutherland urged the establishment of regional economic zones.
“The less prosperous regions can be supported by much more focused government financial and other interventions,” he said
“These could extend to reduced or no taxes – including income tax – (and) fees and charges. Housing grants and immigration incentives could be offered. Development approvals can be fast tracked. This is a horses-for-courses approach (with) each region to be considered on its merits.
“The question in respect to each regional economic zone is, what can government do to maximise the potential of prosperous regions and or stimulate the socio-economic prosperity in the regions doing it tough?”
In another call for an industry-specific tsar, Mr Sutherland said a property infrastructure co-ordinator general should ensure appropriate investment in transport and other infrastructure happened at the right time and place to stimulate the sector.
Harris Real Estate managing director Phil Harris said Adelaide’s data centre capacity should be expanded.
“More and more applications will move to the cloud, whereby safe data storage will be of paramount concern for many businesses,” he said.
“People hate the idea of their data being offshore, so with some of our less attractive industrial real estate with no future prospects, the government could incentivise private investment in data centres to make us a security and storage hub.”
Woods Bagot principal Rosina Di Maria said investment in autonomous vehicles and public transport should be supercharged.
“Activate autonomous public transport in the city, and be the first in Australia to evolve public transport with a dispersed system that allows greater individual freedom and avoids concentration of people and vehicles and the associated congestion,” she said.
Property Council state director Daniel Gannon said red tape should be cut to drive construction activity.
“Right now what we need is a State Government with an appetite to take on debt, put cranes across Adelaide’s skyline and undertake the biggest construction boom South Australia has ever seen,” he said.
Housing Industry Association regional executive director Stephen Knight said Adelaide’s strategy for the past decade of embracing medium and high density housing should be reconsidered.