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Why proposed Gold Coast City Plan changes could hurt motel owners the most

By Grace Ormsby
17 March 2022 | 1 minute read
Gold Coast City Plan

A Gold Coast agent has called out the potential ramifications for development along the Gold Coast Highway if changes to the city plan are approved.

Adam Grbcic of Kollosche Commercial has warned that struggling motel property owners seeking to exit the industry and sell to developers could find their plans frustrated pending new proposed changes to the Gold Coast City Plan.

The changes, proposed within Our City Our Plan Consultation Report Round 4, could severely limit the viability of motel properties as development sites, he has argued.

One of the changes he is most concerned about is the proposal to increase setbacks by between 25 and 30 per cent in the medium-density residential zone for residential dwellings, duplexes and multi-storey unit buildings.

While some motel owners have attempted to turn to development to take advantage of the booming market, Mr Grbcic said these changes would undoubtedly “make it much more difficult for developers to deliver new housing or low to mid-rise unit developments in these precincts on smaller land blocks ranging between 405sqm and 650sqm”.

“Unfortunately, development opportunities would be lost because developments cannot stack up with these setbacks in place,” he explained.

“Motel property owners would lose the development upside that currently exists and is the silver lining for the struggling industry, as they would likely be unable to sell to developers for the highest and best use of the property.”

Mr Grbcic has noted that the motel sector “remains highly challenged” since the onset of COVID-19 – as well as the rise of alternative accommodation services such as Airbnb.

Citing data from IBISWorld, its own estimated revenue declined by 33.9 per cent in 2020-21 due to state border restrictions and the federal government’s previous ban on inbound overseas tourists.

Mr Grbcic said this decline “has come at the same time as development has boomed, particularly on the Gold Coast Highway between Mermaid Beach and Palm Beach”.

While the commercial sales specialist does consider that many potential city plan amendments would benefit future growth on the Gold Coast, he does consider proposals  such as the setback change  could have a “disastrous impact”, particularly on motel development sites.

Instead, Mr Grbcic said that development in the region  particularly of motel sites  should be encouraged. He called it “a win-win for the Gold Coast”.

“Not only does it deliver much-needed medium-density housing for the growing population, but it also offers motel property owners the chance to cash out and reinvest their money elsewhere,” he considered.

“This is all while driving down supply at a time when it is much needed.” 

That supply issue was uncovered in a November 2021 Urbis report, which found the southern beaches area, which runs from Mermaid Beach to Tweed Heads, had the lowest supply of new apartments on the Gold Coast. Just 45 apartments were available for sale.

Why proposed Gold Coast City Plan changes could hurt motel owners the most
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ABOUT THE AUTHOR


Grace Ormsby

Grace Ormsby

Grace is a journalist across Momentum property and investment brands. Grace joined Momentum Media in 2018, bringing with her a Bachelor of Laws and a Bachelor of Communication (Journalism) from the University of Newcastle. She’s passionate about delivering easy to digest information and content relevant to her key audiences and stakeholders.

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