MARKET OUTLOOK BURWOOD EAST

Burwood East offers convenient access to local employment and education centres as well as attractive lifestyle amenity, with direct links to 's CBD via tram and major arterial roads.

01 Australian Economy 02 Why Melbourne 03 Walkability & Accessibility 04 Infrastructure 05 Employment & Education 06 Population & Demographics 07 Residential Market 08 Rental Market

Prepared exclusively for Frasers Property Group January 2021 AUSTRALIAN Australia's economy has proven resilient amidst turbulent times, with solid foundations for rebound ECONOMY and growth.

Australia maintained strong economic growth over the international borders will likely reopen in 2021. This would decade to 2019, with real GDP growing at an average set Australia on a steady recovery of population growth, of 2.5% per annum. Australia is also a resilient likely hitting strong pre-COVID-19 population growth rates economy, achieving positive growth of 1.9% in 2009 by 2026. during the GFC. Recently, Australia's economy has avoided a more severe contraction from the pandemic, Australia offers strong fundamentals for a resilient when compared with other developed countries. economy - good governance, coupled with strong and transparent institutions. This was clearly demonstrated Australia's strong population growth is a key factor in the in Australia's effective pandemic response and resilience country's growing economy. High levels of inward migration of the Australian dollar, which has strengthened since ensure the country continues to benefit from a diverse March 2020. Australia has also implemented a range of culture and strong international ties. In comparison with demand stimulating measures, such as stamp duty waiver, other developed nations, Australia has experienced high monetary policy supporting the property sector, vaccine average annual population growth, at 1.6% for the decade arrangements, and individual tax relief. These measures to 2019. Recent international border closures have slowed have well-positioned Australia for a strong rebound in the inward migration and population growth in the immediate years ahead. term. However, Federal Budget has indicated that

REAL GDP GROWTH Comparison of selected developed nations

Canada Japan New Zealand United Kingdom United States Australia

6.0% 2.4% 2.8% 3.8% 2.3% 2.8% 2.5% 2.7% 2.1% 2.6% 1.8% 4.0% 1.9% 2.0% -4.2% 0.0% -2.0% -4.0% -6.0% -8.0% -10.0% -12.0% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Source: International Monetary Fund, Urbis

EXCHANGE RATE Comparison of selected developed nations against AUD SGD USD EUR CNY HKD 1.20 10.00 9.00 1.10 8.00 1.00 7.00 0.90 6.00 5.00 0.80 4.00 0.70 3.00 AUD/CNY & HKD 2.00 0.60

AUD/SGD, USD & EUR 1.00 0.50 0.00 Jun-2015 Jun-2016 Jun-2017 Jun-2018 Jun-2019 Jun-2020 Period (End of Month) Source: Reserve Bank of Australia, Urbis

AVERAGE ANNUAL POPULATION GROWTH 2009-2019

1.6% 1.3% 1.1% 0.7% 0.7% -0.1%

UNITED UNITED AUSTRALIA NEW ZEALAND CANADA STATES KINGDOM JAPAN Source: The World Bank, Urbis. Note that 2019 data is most recent. 2 Market Outlook Burwood East WHY Melbourne’s global brand continues to grow after ranking second place for the World's Most Liveable MELBOURNE City, in 2018 and 2019.

In 2018 and 2019, Melbourne was ranked the second Melbourne's liveability not only attracts tourists, but also most liveable city in the world. This follows seven makes it the fastest growing city in Australia in absolute previous consecutive years as number one, as voted terms, growing by over 550,000 people between 2011 by the Economist Intelligence Unit. This strong and 2016. Greater Melbourne's population is anticipated performance can be attributed to strong healthcare, to surpass Greater Sydney's within the next 15-20 years, education and infrastructure, along with the city’s making it Australia's most populous city. Leading up to cultural diversity, environment and political stability. this, Melbourne anticipates to welcome over 95,000 residents annually. Melbourne's internationally praised Melbourne is a global events destination, hosting many response to a second wave in 2020 has further enhanced annual events which attract visitors from around the world. its appeal to new residents as a liveable and safe city in 2021. Melbourne's residential market has remained EVENTS HOSTED IN MELBOURNE resilient, and despite an overall fall in sales and median prices during 2020, apartment sales and house prices Australian Open Tennis Grand Slam were still higher than the same period in the previous year (2019). The aid of government stimulus like the Melbourne F1 Grand Prix HomeBuilder and First Home Owner Grants and Stamp Duty waivers, further supports Melbourne's residential AFL Grand Final market recovery.

Melbourne Cup Racing Carnival MELBOURNE TOURISM Year to March 2020

Virgin Australia Melbourne Fashion Festival

Melbourne Food and Wine Festival Royal Melbourne Show 2.7M $7.6B INTERNATIONAL INTERNATIONAL VISITORS VISITOR SPEND Source: Tourism Research Australia

GREATER CITY - AVERAGE ANNUAL GROWTH Forecast to 2040 ('000)

Darwin 2.8 Canberra 6.4

Brisbane 42.6 Sydney Perth 82.4 34.3 Melbourne 95.2

Adelaide 10.0 Hobart Source: ABS, Urbis Note: Projections are pre-COVID-19. 2.0

Prepared exclusively for Frasers Property Group 3 WALKABILITY & ACCESSIBILITY

Port Phillip Bay

Presbyterian Ladies College

Deakin University Burwood Campus

No. 75 Tram Line

AY W GH HI D OO RW BU Burwood Heights Burwood Brickworks MIDDLEBOROUGH RD Shopping Centre Shopping Centre

Burwood One Tally Ho Dandenong Shopping Centre Burwood East Reserve Business Park Ranges

Burwood East is located 17 kilometres east of RETAIL AMENITY Melbourne’s CBD with access to major roads Burwood Brickworks features over 30 specialty stores, including Burwood and Blackburn including Woolworths, Dan Murphy's, Reading Cinemas, Road which both link to the . Acre Farm & Eatery, Insight Early Learning Centre, a Additionally, Burwood East is well serviced by medical centre, Choice Pharmacy, Cannings Butcher and Melbourne’s tram network with route 75 running Hu Hui Supermarket. Burwood One features over 70 stores, including Kmart, Coles, Aldi, and a brand new casual dining every 10 minutes during peak times to Docklands. court. Burwood Heights Shopping Centre offers more retail Several bus routes also service the area and amenity, with a Woolworths and BWS Liquor store. connect to railway stations providing a 30-minute journey to Melbourne’s CBD.

4 Market Outlook Burwood East Burwood East is easily accessible by public transport and is well positioned for commuting into the city or escaping to the beach or for leisure.

Melbourne CBD

Box Hill Hospital Wattle Park Golf Course

MIDDLEBOROUGH RD Burwood East Local Government Total Area Ha 426 Ha Open Space 32 Ha Schools 6 Distance from Melbourne CBD 17km

EMPLOYMENT & EDUCATION PARKS & RECREATION Burwood East is surrounded by a range of employment Burwood East features ample open space and sporting opportunities, including the Tally Ho Business Park and Box facilities including the East Burwood Reserve, which offers Hill Hospital. The Tally Ho Business Park located at the tennis courts, two ovals, a cycling track, a basketball intersection of Burwood Highway and Springvale Road is a key stadium and an athletics track. The Dandenong Ranges hub for high technology business and innovation in the eastern are also an easy drive east for an afternoon bushwalk, suburbs with corporations such as Motorola, Hewlett Packard, while Bay and Mornington Peninsula beaches are easily Pronto Software and Fujitsu. accessible. This diverse mix of employment, education, retail and lifestyle amenity continues to drive residential Furthermore, Burwood East is close to Deakin University as demand within Burwood East. well as numerous private and public schools, including Glen Waverley Secondary College, Forest Hill College, Mount Scopus Memorial College, Presbyterian Ladies' College, St Benedict’s Primary School and Burwood East Primary School. Prepared exclusively for Frasers Property Group 5 There are several infrastructure projects underway or in the pipeline which will enhance Burwood East’s INFRASTRUCTURE liveability.

The City of Whitehorse will benefit from more than $50 billion dollars worth of private and public infrastructure investment in the future pipeline. This includes commercial and mixed use projects, which will add to the existing amenity in the area, and also generate additional local jobs.

BURWOOD DEAKIN UNIVERSITY BRICKWORKS BURWOOD CAMPUS SHOPPING CENTRE INFRASTRUCTURE $118 MILLION AND UTILISATION Completed Dec 2019. PLAN $316.5 MILLION The 13,000 sq.m Planned shopping centre officially opened for A total of 46 projects trade in December are proposed for the 2019, offering a mix of flagships and localised speciality Burwood Campus between 2015 and 2024 as outlined in stores across food and dining, entertainment, retail the Campus Infrastructure and Utilisation Plan. Significant services, health and wellbeing. The centre aims to be the Projects include the refurbishment of several buildings to most sustainable shopping centre in the world, with a focus create undergraduate teaching laboratories, a new School on recycling rain and water waste, as well as sustainable of Law building and increased student accommodation power generation. One of its key features is Australia's first creating quality affordable housing for an additional 505 urban agriculture project in a shopping centre, with a 2,000 students. sq.m rooftop farm run by acre farm & eatery. In October 2016, Deakin commenced work on the Burwood The shopping centre forms part of the development of the Link, a pedestrian crossing between the Burwood Highway former Burwood Brickworks site, which will be a mixed and Elgar Road sides of Deakin’s Melbourne Burwood use development across 18 hectares, including retail, Campus. The Burwood Link finished construction in residential, commercial, leisure, health and wellbeing uses. mid-2017.

EPWORTH SURBURBAN EASTERN PLUS RAIL LOOP STAGE 1 $50 BILLION $50 MILLION Construction to Under construction. begin 2022+ Stage 1 of the The Suburban Rail Epworth hospital Loop project aims upgrade will include to improve Victoria’s a new emergency public transport department, 2 operating theatres, 60 overnight acute system, connecting patient beds, 15 rehab beds, and 20 consulting suites. every major train line from the Frankston Line to the Car parking for an additional 57 vehicles will span over Werribee line, and improving access to housing, jobs, 3 levels and will interjoin with the existing car park. The schools, universities and hospitals in Melbourne’s middle new hospital facility will measure 15 stories in height and suburbs. Stage 1 of the project includes the construction is estimated to complete in late 2020. of the south-east section of the loop, with a brand new train station located in Burwood. The delivery of this rail loop will connect residents to key employment precincts in Clayton, Monash, Glen Waverley, Box Hill, Sunshine, Bundoora and Werribee, as well as Melbourne Airport.

6 Market Outlook Burwood East EMPLOYMENT 42,800 additional jobs are forecast for Melbourne's inner & EDUCATION south-eastern suburbs by 2031.

EMPLOYMENT EDUCATION Proximity and access to Melbourne's CBD is likely to be an Deakin University's Melbourne Campus lies in the heart of attractor for Burwood residents with 10% of those who are Burwood, ranked in the top 15 universities across Australia. employed working there. A further 13% are employed within The university boasts over 61,000 students, almost 13,000 Burwood and Burwood East, primarily centred around the international students, and its English language Institute Tally Ho Business Park. (DUELI) is the second largest university English language centre in Australia. In 2019 Deakin ranked among the Around 80% of employed Burwood and Burwood East top 2% of universities worldwide according to all major residents work in white collar jobs. This comprises international university rankings including Times Higher of managers, professionals, sales and administration Education. Additionally, five private, three public and two professions. The concentration of people in these jobs is special schools are located in the Burwood East Study Area 6 percentage points higher than the Greater Melbourne providing residents with access to all levels of education. average. Burwood East is well positioned to capitalise on future 2031 JOB FORECAST employment growth as part of the Monash National Inner South East Region Employment and Innovation Cluster, which according to the Victorian Planning Authority already supports more than 75,000 jobs and $9.4 billion annually to the State economy. 2020 230,200 +42,800 jobs Key industries in Melbourne’s inner south-eastern suburbs anticipated to see growth by 2031, include retail trade, healthcare and social assistance, professional, scientific and 2031 technical services, education and training. Between 2020 273,000 and 2031, an additional 42,800 new jobs are forecast for this region, with the majority in community and business services. Source: Plan Melbourne

10

04 08 07 01 06 09 Burwood Brickworks BURWOOD BURWOOD EAST

03 02 05

SCHOOLS IN BURWOOD AND BURWOOD EAST 01 Blackburn English Language 04 Burwood Heights Primary School 08 Presbyterian Ladies' College School 05 Emmaus College 09 St Benedict’s School Primary 02 Burwood East Primary School 06 Forest Hill College School 03 Burwood East Special 07 Mount Scopus Memorial College 10 Wattle Park Primary School Development School

Prepared exclusively for Frasers Property Group 7 Burwood East and Burwood are projected to welcome nearly 10,000 additional residents POPULATION by 2036 - a 36% boost in population.

There are approximately 26,200 residents living in Burwood East and Burwood. The area saw a 30% increase to its population since 2001 reflecting an annual increase of about 330 residents. The latest government projections anticipate Burwood East and Burwood growing more than it has historically. By 2036, the area will welcome nearly 10,000 additional residents equating to a population over 35,700. The boost in population anticipated in Burwood East and Burwood will mean a greater number of dwellings will be required to support new residents. Approximately 3,310 additional dwellings are needed to support new residents between 2021 and 2036. Strong future demand to live in Burwood East will only be further propelled as the supply of developable land becomes scarcer over time.

POPULATION FORECAST Burwood East Study Area 35,760 32,670 29,700 26,760 23,670 21,940 20,470 19,990

2001 2006 2011 2016 2021 2026 2031 2036 Source: ABS, SAFI, Urbis Note: Projections are pre-COVID-19.

DWELLING FORECAST Burwood East Study Area

13,580 12,440 11,390 10,270 9,060

2016 2021 2026 2031 2036

Source: ABS, SAFI, Urbis Note: Projections are pre-COVID-19.

8 Market Outlook Burwood East Burwood East is characterised by a young, international demographic taking advantage of the high-quality education offered by DEMOGRAPHICS Deakin University.

The demographic profile of Burwood East and Burwood INCOME GROWTH - BURWOOD EAST / BURWOOD reflects the impact of Deakin University with 15% of 2006 - 2016 residents aged between 20-24 years as at 2016. This is over double that for Greater Melbourne at 7% and largely 2006 2016 attributable to the number of tertiary students living in the area. Additionally, there are a higher proportion Average +27% of residents over 65 years old in Burwood, accounting Household for 18% of residents, compared with 14% in Greater Income Growth Melbourne. Aside from these specific differences, there is a reasonable depth across all age cohorts, which opens up opportunities to provide a range of housing options. Average Per Capita Burwood East and Burwood is a popular residential Income Growth area for foreign born residents, with 52% of residents 2006 2016 born overseas compared to 36% across Greater Melbourne. This can in part be explained by the large +28% number of international students residing in the suburb. Recent border closures may have limited international Source: ABS, Urbis student numbers in the short-term, however Australia remains an attractive destination for education, offering proximity to Asia and a safe, livable environment. When WHO LIVES IN BURWOOD EAST / BURWOOD borders reopen (likely next year), we expect recovery of international student arrivals. The housing structure Burwood East Greater /Burwood Melbourne across the area differs from the typical household composition across Greater Melbourne with a higher 52% 36% proportion of group households, at 10% in Burwood East Overseas born and Burwood, compared with 5% in Greater Melbourne. Average household and per capita incomes in the area increased by 27% and 28% respectively in the 10 years 79% White collar 73% to 2016. This may be attributed to the increase in white professionals collar workers in the area who generally earn higher incomes. 33% Bachelor Degree 27% or higher

10% Group 5% households

AGE DISTRIBUTION Source: ABS, Urbis 2016 Burwood East Study Area Greater Melbourne

20%

15%

10%

5% Population of Residents 0% 0-4 5-9 10-14 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-55 55-59 60-64 65+ Age Bracket Source: ABS, Urbis

Prepared exclusively for Frasers Property Group 9 RESIDENTIAL Burwood East has a resilient apartment market with its median price increasing 12% MARKET in the year to July 2020.

SALE PRICE AFFORDABILITY GAP - BURWOOD EAST Year to July 2020 Burwood East registered a median unit price of $702,500 for the year to July 2020. Compared to the surrounding suburbs of Vermont South, Glen Waverley, Mount Waverley and Ashburton, this median price is relatively more affordable. The difference is a median price saving of between $168,000 and $527,500. $1,067,500 This provides a more achievable entry point into the HOUSE market. The level of affordability Burwood East offers is $365,000 expected to be a driver for aspiring residents looking to GAP move into the Eastern suburbs. PRICE GROWTH $702,500 UNITS Burwood East recorded median unit price growth of 3.6% per annum from 2010 to 2020. This demonstrates healthy long-term growth in the area. Source: Pricefinder, Urbis The resilient apartment market Burwood East retains MEDIAN PRICE GROWTH also extends in more recent periods. Median unit Burwood East - Units price grew 12% in the last 12-months to July 2020. Meanwhile, sales volumes increased by 87% from 2019 to 2020. This is attributable in part to Burwood East's growing appeal as a suburb that can offer space and livability, coupled with access to inner-city 3.6% 12.0% amenities and jobs. It is also likely that Burwood East P.A. has benefited from Federal Budget's recent stimulus measures such as stamp duty waiver and expansion of the First Home Loan Deposit Scheme. These growth 2010-20 2019-20 trends indicate continued demand for units in this area. Source: Pricefinder, Urbis AFFORDABILITY GAP There is a relatively large affordability gap between houses and units in Burwood East. In the year to July 2020, houses were 52% or $365,000 more expensive than units. This may shift demand in favour of units as the price point is more accessible to a broader range of purchasers.

MEDIAN UNIT PRICE Year to July 2020

Burwood Median Unit Price East Saving

Burwood East $702,500

Vermont South $1,050,000 $347,500

Glen Waverley $870,500 $168,000

Mount Waverley $1,000,000 $297,500

Ashburton $1,230,000 $527,500

Source: Pricefinder, Urbis

10 Market Outlook Burwood East The median unit rent in Burwood East steadily RENTAL grew over the decade and has continued to increase in the 12-months to September 2020 MARKET - demonstrating a resilient rental market.

RENTAL MARKET OVERVIEW Renting is a popular form of housing tenure with a third of households renting in Burwood East and Burwood. The proportion of renters is higher than that across Greater Melbourne at 31%. Burwood East and Burwood experienced THE PROPORTION OF RESIDENTS THAT growth in the proportion of renters from 23% in 2006 to RENT IN BURWOOD EAST & BURWOOD 33% in 2016 - reflecting the strong rental market growth. HAS INCREASED BY 10 PERCENTAGE The rental market is supported by a high proportion of POINTS IN THE DECADE TO 2016. of tertiary students in the area, likely attending Deakin university.

MEDIAN WEEKLY RENTS MEDIAN WEEKLY RENTS ^ The Burwood East catchment recorded median Burwood East Catchment weekly rents of $260, $430 and $540 for one, two $550 1 Bed 2 Bed 3 Bed and three-bedroom units respectively over the year to September 2020. $500 $450 Median weekly rent for units across the Burwood East catchment have shown steady growth over the long-term. $400 The median rent across all units grew by 2.0% per annum $350 over the past decade. The 12 months to September 2020 saw rents hold steady, even amidst border closures and $300 lockdowns during the recent pandemic. This is testament $250 to Burwood East's resilient rental market. $200

RENTAL YIELD Sep-11 Sep-17 Sep-12 Sep-15 Sep-13 Mar-11 Sep-18 Sep-16 Sep-19 Sep-14 Mar-17 Mar-12 Sep-10 Mar-15 Mar-13 Mar-18 Mar-16 Mar-19 Sep-20 Mar-14 Mar-20 Units in Burwood achieved an indicative gross rental Rolling Annual - Quarters yield at 3.3% in the 12-months to September 2020. This outperformed most surrounding areas including Source: Department of Health & Human Services, Urbis ^Burwood East Catchment comprises the following suburbs: Burwood Ashburton (2.5%), Glen Waverley (3.0%) and Vermont East, Burwood, Forest Hill, Vermont South, Ashburton and Ashwood. South (2.2%).

INDICATIVE GROSS RENTAL YIELD - UNITS HOUSING TENURE - RENTER September 2020 Change 2006 - 2016

3.3% BURWOOD EAST GREATER 2.5% AND BURWOOD MELBOURNE Burwood East 2.5% Ashburton 2006 Mount Waverley 23% 26%

3.0% 27% 2011 28% Glen Waverley 3.3% Burwood 2.2% 33% 2016 31% Vermont South

Source: Pricefinder, Urbis Source: ABS, Urbis

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