Queensland developer Kevin Seymour says Canberra must provide more Olympic funding

A veteran Queensland property developer says the federal government must put more funds into the 2032 Olympics as cost blowout predictions grow.

Queensland developer Kevin Seymour.

Veteran Queensland property developer Kevin Seymour has called on the federal government to take a larger role in funding the 2032 Olympics and Paralympic Games amid mounting challenges of cost blowouts and competition from a multibillion-dollar infrastructure pipeline.

With less than eight years before the Games, the new LNP government is still considering whether to build new legacy facilities or upgrade existing ones for the flagship events.

The last state budget provides for capital expenditure for Brisbane 2032 venue infrastructure of $7.1bn. Almost half is committed by the federal government.

However, there are concerns that this will not be enough, with a recent Queensland Major Contractors Association report citing an increase in the value of major government and private projects to $103.9bn over the next five years, up from $92bn in the previous year.

Mr Seymour said the state government faced “a major balancing job” to provide for the needs of the community and for the Olympics.

“The biggest problem is that Queensland has to make sure we don’t run up a huge debt to finance the Olympics,” he said.

“I think the federal government has a bigger role to play to provide more funds. They have to accept their responsibility and provide more money.

“The other thing that worries me is the amount of money required to meet all the infrastructure requirements.”

An artist’s impression of the proposed Olympic venues at Victoria Park. Picture: Archiepelago

The cost of scores of major infrastructure projects around Queensland has blown out over the past few years because of the impact of the Covid pandemic.

The new state government claimed last week that Cross River Rail wouldn’t be operational until 2029 and would cost more than $17bn, a figure disputed by the opposition.

The last costing for the project was $6.9bn, still $1.5bn more than what it was expected to cost when it was announced in 2017.

In its Year-End Australian Construction Market View, global consultancy firm Arcadis raised its estimate for building cost increases in Brisbane for each year to 2028. Its forecast for 2024 was a 6 per cent increase – up from the previous 5.2 per cent – and 7 per cent in 2028, up from the 6.2 per cent it expected in June.

The report forecasts Brisbane building cost increases to come in at around 6.5 per cent in 2025, compared to the previous forecast of 5.3 per cent.

That is in contrast to Melbourne and Sydney building cost forecasts, which Arcadis has revised down. The report predicted Melbourne’s costs to rise by 3 per cent in 2025, down from 5 per cent previously forecast, and Sydney up 4.6 per cent, down from 6.8 per cent.

The report said the Queensland construction market remained relatively busy, with the value of construction work done, in seasonally adjusted terms, 4.3 per cent higher in the year to June 2024.

Building costs in Brisbane and Perth are forecast to rise in 2025.

“Considering the pipeline of construction work that is anticipated to start by the middle of next year, it is likely that capacity issues and labour availability will hit here (Queensland) before other states,” it said. “As more projects start to hit the market in 2026 and beyond – particularly in connection with the 2032 Olympic Games – we anticipate that construction cost escalation will stay well above the long-term trend.”

The report said the persistent shortage of skilled labour in Queensland continued to cast a shadow over construction projects, significantly affecting construction timelines and cost.

It said the construction market remained relatively busy – but not overstretched.

“With a glut of major projects on the horizon getting nearer, there is now a growing concern that the market will exceed available capacity quite quickly from as early as the second half of next year,” the report said.

Mr Seymour, who has been in a major development player in Queensland for more than 60 years through the Seymour Group, said labour shortages were a critical issue in the Olympic infrastructure rollout.

“I think they’re going to struggle. And the reason for that is that they have so much infrastructure to build outside the Olympics – hospitals, roads and everything else,” he said.

How the proposed Brisbane Stadium, new National Aquatic Centre and Brisbane could look.

In November, the LNP government started a 100-day review of planning, competition venues, transport and infrastructure needs. It will issue its report in March. At stake is whether there will be a focus on upgrading stadiums like the QEII in Nathan – in Brisbane’s southeast – and the Gabba.

The mooted Victoria Park development in the inner city includes a 60,000-seat stadium, an 18,000-seat aquatic centre and a 12,000-seat arena at the city’s Victoria Park.
There have also been plans from private groups for a 60,000-seat Northshore waterfront stadium on the edge of the Brisbane River in Hamilton.

Master Builders Queensland chief executive Paul Bidwell does not believe building costs will fall.

“There’s just no sign of costs going backwards. My sense would be that the builders have a handle on the cost increases so I don’t think they’re going to get caught short,” he said.

“But whether or not the government has enough in the kitty to cover costs remains to be seen. One of the discussions is around whether we should we push for some projects to be delayed.

“But you can’t say we’re not spending in this part of the state and end up spending in this other part won’t wash.”