The Wealth Report City Series EDITION The local perspective on prime property and lifestyle

THE WEALTH REPORT – MELBOURNE EDITION

Welcome to the Melbourne Edition

Andrew Hay Global Head of Residential [email protected] +44 20 7861 1071

Welcome to the Melbourne Edition of attractive to wealthy residents from The Wealth Report, Knight Frank’s annual across , the wider Asia-Pacific Contents thought-leadership publication for our region and even further afield. UHNW clients and their advisors. The importance of Melbourne’s 01 It is particularly fitting that Melbourne economic mix and skilled employment Briefing should be the focus of our first special base in the context of future investment in In the 12 months to the end of city edition. Its reputation as one of the city-wide infrastructure is also discussed. December 2016, Melbourne prime world’s most exciting urban centres was Findings from previous editions of residential prices increased by underlined when it was named the world’s The Wealth Report have confirmed 8.8%, and grew by 35.1% over the most liveable city for the sixth that lifestyle is a critical issue driving past four years consecutive year in the latest rankings by investment into residential markets page 02 The Economist Intelligence Unit. globally. We consider place-making, This publication not only builds architecture, art, fashion, health, sport 02 on the research and insight Knight and the burgeoning food scene in Living Frank provides every year in The Wealth Melbourne to provide a rounded view From culture to countryside, Report, but also takes a deeper, more of the opportunities the city offers and employment to education, we look localised focus on the issues that that justify its world ranking. at why Melbourne was named the matter to investors, both domestic and We have also assembled an impressive world’s most liveable city for a overseas. It confirms recent trajectories array of experts, who help untangle the remarkable sixth year in a row and drivers, but also forecasts future latest developments in three critical areas page 12 trends and attractions of this leading for residential buyers: new visa rules, the 03 Asia-Pacific destination. latest property taxation reforms, and Insight Knight Frank’s growing market strength school and university options. in Australia means we are able to provide Wherever you are based, or have What are the implications of a comprehensive view of the economy, invested in the past, I hope you enjoy the relocating to a new city, or even investment opportunities, lifestyle and the Melbourne Edition. I am sure you will find another country? Our three experts on immigration, tax and finance, residential market in what is considered it an invaluable aid to your investment NOW AVAILABLE and education give an overview by many to be a world-class city. decisions as you plan for the future. page 26 The definitive analysis on global Our Australia research team provides Our residential and commercial wealth and investment trends a detailed view of where Melbourne sits property teams are available to discuss in the world ranking of prime residential your requirements, whether that’s in markets, examining some of the factors Melbourne or any of the key global – such as relative affordability and the markets we cover via our network of influence of currency – that make it so offices across 58 countries. FLIGHT TIMES TO MELBOURNE

7 6 8 5

The global perspective on prime property and investment 4

3 2 THE WEALTH REPORT 2017

The global perspective on prime property and investment

1 THE WEALTH REPORT 2017

The global perspective on prime property and investment

1 Sydney = 1 hr 35 mins THE WEALTH REPORT 2017 2 Singapore = 7 hrs 20 mins

3 Kuala Lumpur = 7 hrs 30 mins 4 Bangkok = 8 hrs 50 mins 2017 KnightFrank.com/WealthReport 11th Edition

2017 KnightFrank.com/WealthReport 11th Edition 5 Hong Kong = 9 hrs 20 mins 2017 KnightFrank.com/WealthReport 11th Edition 6 Shanghai = 10 hrs 50 mins

7 Beijing = 11 hrs 30 mins

8 New Delhi = 12 hrs 15 mins KNIGHTFRANK.COM/WEALTHREPORT 02 BRIEFING THE WEALTH REPORT – MELBOURNE EDITION 03

PAUL SAVITZ DIRECTOR OF RESEARCH Key topics & CONSULTING 01 A winning performance Find out why Melbourne sits in the top eight of Knight Frank’s Global Cities Index for prime residential property page 04

02 In good company As a place to both live and invest, Australia’s second city is an attractive proposition page 06

03 A city on the move World-class Infrastructure improvements taking place across Melbourne are opening up new areas for residential and business use credentials page 10

Since 2012, the prime residential market accounting for 28.9% of the national wholesale change – rather, many are in Melbourne (AU$3m+) has shaken off its population increase. looking at a lower-maintenance home in post-financial crisis inertia. According to Foreign migrants not meeting the a similar location or near the central the Knight Frank Prime Global Cities investment criteria of Australia’s business district. This way, they are Index, the city saw annual price growth Significant and Premium Investor Visa familiar with their community and its of 8.8% in 2016, despite new fees being must buy a ‘new’ residential property in amenities, with family and friends introduced for foreign buyers. An order to comply with federal government nearby, while still near enough to enjoy increase in prime values, averaging 2.4% regulations. Many buyers have already Melbourne’s centre. growth per quarter since the June 2015 seen strong investment returns in other These factors, together with quarter, has buoyed values by 76.9% over global cities after buying into projects in Australia’s increasingly important the last decade. once-obsolescent inner-city areas. They safe-haven status, record low interest There continues to be a limited supply are now in a position to add an Australian rates and cheaper finance, are of new prime residential properties being property to their international portfolio. establishing Melbourne as one of the built in Melbourne. This is set against Taking advantage of the lower world’s strongest cities for prime rapid population growth enhanced by Australian dollar, many expats are residential property demand. The strong migration. Greater Melbourne’s returning temporarily to buy a property upsurge in prime transactions, from circa population of 4.53 million has risen at in preparation for resettling in Australia. 300 in 2011 and 2012 to average over 840 a rate of 2.1% per annum over the past 10 Downsizers who have previously lived in between 2014 and 2016, has confirmed its years. At the last count, Melbourne was prestigious suburbs are also taking position on the global prime-residential found to be Australia’s fastest-growing advantage of current market conditions. stage, and only a lack of available prime city, adding 91,600 residents in 2015, They are not necessarily seeking a stock is limiting growth in transactions.

PRIME MELBOURNE SALES VOLUMES: 2011–2016 (AU$3M+) CUMULATIVE PRIME PROPERTY VALUE INCREASE 2006–2016 Data to December

2011 299 100%

2012 296 77 75% 2013 488 63

49 2014 706 50% 38 37 38 31 2015 1024 22 24 25 25% 2016 796 0

0 100 200 300 400 500 600 700 800 900 1,000 2011 2012 2013 2015 2014 2016 2010 2007 2008 2009 2006

Source: Knight Frank Research 04 BRIEFING THE WEALTH REPORT – MELBOURNE EDITION 05

CURRENCY MATTERS THE NUMBER OF SQUARE METRES US$1M WILL BUY IN... Based on prime residential prices as at December 2016 Over the three years in which Melbourne’s prime residential growth has totalled 35.1%, the performance of global currencies against dollar has influenced relative price growth Monaco 17 A winning for different nationalities using foreign performance currencies to fund their purchases. Hong Kong 20 New York 26 The prime-residential property sector in Three-year Melbourne is continuing to experience prime Melbourne London 30 impressive price growth residential growth Geneva 42 35.1% Singapore 43 A severe lack of prime residential supply, Australian dollars 27.6% strong population growth, favourable Shanghai 46 domestic economic conditions and Japanese yen a commitment to new infrastructure 27.6% Paris 55 projects are all contributing to upward ALAN BAXTER/GETTY IMAGES Canadian dollars pressure on pricing in Melbourne. After Beijing 58 a long period of negligible growth across 23.9% Sydney 59 the city, the past four years have seen UK pounds prices begin to catch up with, and Los Angeles 61 surpass, other global destinations. Vancouver and Los Angeles recorded (in square metres) that US$1m will buy in Along with Shanghai, Beijing, stronger prime residential price growth cities around the world shows Monaco is Miami 79 Guangzhou, Seoul, Toronto and than Melbourne since 2012, increasing by the tightest, with our generous budget 18.0% Vancouver, Melbourne now sits in 61.4% and 36.1% respectively. stretching to cover only 17 sq m, followed Berlin 87 Euros the top eight of Knight Frank’s Prime Placing Melbourne’s notable price by Hong Kong at 20 sq m, New York at 26 Tokyo 91 Global Cities Index (out of 40 cities) for performance into a broader context, the sq m and London with 30 sq m. In annual prime residential market Knight Frank Prime Global Cities Index Sydney, lower base pricing means our Mumbai 99 performance. Sydney ranks seventh. has consistently recorded annual average budget stretches to 59 sq m. However, Both cities recorded over 8% annual price growth across all cities of between 3.6% prime Melbourne is larger again, Istanbul 102 growth for the sixth consecutive quarter and 5% since midway through 2014. New covering an area close to 110 sq m (down 11.4% to Q4 2016, making Australasia the regulation, in the form of taxes and fees from 116 sq m in 2015) – equivalent to Singaporean dollars Melbourne 110 strongest-performing region in the world, for foreign purchasers, is increasing in around six times the accommodation size at 9.1% annual growth in 2016, comparing a number of locations across our index. that can be purchased in the world’s Dubai 162 well with the next best performing The impact, although dependent on highest-priced cities. For super-prime Sao Paulo 176 region, North America at 6.6%. specific market fundamentals, is Melbourne apartments – broadly defined In the 12 months to the end of 2016, restricting overall global price growth. as the top 1% of the market and generally 5.0% Cape Town 209 Melbourne prime residential prices Despite this recent outperformance, considered as those apartments with China renminbi increased by 8.8%, and grew by 35.1% Australia’s global gateway cities remain premium views, specifications and over the past four years. Outside of relatively affordable on a comparative amenities, in the most prized locations Australia and China, and across Knight basis. Knight Frank’s global research into – actual sales evidence shows this figure

Frank’s benchmark global cities, only the amount of prime residential property ranges from 60 sq m to 85 sq m. But this -5.8% Hong Kong dollars

-5.8% Notes: Price ranges for Hong Kong, Beijing and Shanghai are for properties considered “super-prime”. PRIME GLOBAL CITIES INDEX US dollars Prices used in the calculation for Hong Kong are based on apartments only. All currency calculations are based on the prevailing rate on 30 December 2016. Prime residential cumulative price performance 2013 – 2016 Source: Knight Frank Research Source: Knight Frank Research, Douglas Elliman/Miller Samuel Country Location 2013 2014 2015 2016

Melbourne 5.4% 13.5% 24.2% 35.1%

Sydney 3.5% 15.6% 33.4% 45.8% is still up to 45% more than the amount of from the US or Hong Kong, Melbourne recent four-year period. Singapore 15.7% -3.0% -5.0% -1.7% prime residential space one can buy in prime residential prices have decreased Investors who purchased five years Sydney, and over three times the by 5.8% over the past four years, when ago may not have realised any true or Hong Kong -2.2% 0.6% -3.1% -1.0% amount that can be purchased in the factoring in currency movements to the significant price growth. However, for highest-priced global cities. end of December 2016, despite strong those looking to purchase in this current Los Angeles 17.7% 23.3% 29.2% 36.1% Knight Frank has also calculated the local price growth. phase, using any of the above currencies, Shanghai 6.1% 5.7% 20.6% 53.6% adjustment in value for international For those buying with Chinese the prime Melbourne outperformance purchasers by combining changes in Renminbi, the relative price of Melbourne over the past five years has effectively Beijing 17.1% 16.5% 37.4% 74.2% prime residential prices with currency prime residential property has increased been eroded by a weakening of the movements. There are two angles from by 5.0% compared with the same period Australian dollar. If the US dollar edges London 7.7% 13.2% 14.3% 7.1% which to consider the data. Firstly, from in 2012. For those who purchased with higher, and currencies closely linked to it Vancouver 5.3% 13.2% 40.9% 61.4% Demand for prime those who have already purchased and, Sterling or Singaporean dollars, the price follow, demand for prime residential residential property in secondly, those who are prospective of Melbourne prime residential property property in Melbourne has the potential Source: Knight Frank Research Melbourne is on the rise buyers. For an investor or owner-occupier has risen by 23.9%, or 11.4% over the to increase further. 06 BRIEFING THE WEALTH REPORT – MELBOURNE EDITION 07

POPULATION GROWTH IN GREATER MELBOURNE

4,600,000

In good company An influx of global companies has helped put Melbourne on the map 4,400,000 as a desirable place to live and work

Melbourne is a flourishing and rapidly Melbourne could overtake Sydney as growing city. At the last official count, the the largest Australian city by 2030. The EUROPEAN Greater Melbourne area in the state of Australian Bureau of Statistics predicts COMPANIES WITH THEIR AUSTRALIAN has a resident population of 4.53 the number of Greater Melbourne HEADQUARTERS 4,200,000 IN VICTORIA million, rising 2.1% per annum over the Melbourne households will reach 2.24 million by past decade – a higher pace than the 2030, growing at 1.9% per annum. This is Australia’s Melbourne’s strong business and 0.65% per annum increase recorded on rate equates to a need for approximately fastest-growing transport links are resulting in a average for all countries in the 38,000 additional new residential GlaxoSmithKline significant increase in population Organisation for Economic Co-operation capital – it dwellings per year. and Development over the same period. could overtake The Victorian state economy has SABMiller It is Australia’s fastest-growing Sydney as experienced strong growth over the past 4,000,000 capital, adding 91,600 residents in 2015, the country’s decade. The economy is larger than BASF accounting for 28.9% of the national largest city by Singapore, New Zealand and Hong Kong, increase. Victoria also saw the largest 2030 accounting for almost a quarter of Bosch increase in net interstate migration in the national GDP in 2014/15. Over the past 12 12 months to June 2016, and the state’s months, employment growth was largely Siemens biggest gain on record, registering 16,700 driven by health care, construction, new arrivals, increasing employment education and professional services Glencore Grain 3,800,000 levels and supporting housing demand. sectors. The rise has been consistent with a rebalancing of growth towards services, with employment growth running at US COMPANIES WITH 2.6% across Victoria. THEIR AUSTRALIAN HEADQUARTERS Five of the top 10 (by market IN VICTORIA capitalisation) of Australia’s top 100 companies have their headquarters in Melbourne. These companies are leaders Cargill 3,600,000 in their fields, and include BHP Billiton, ANZ, CSL, NAB and Telstra. Melbourne’s Boeing reputation as the nation’s centre for business, shopping, fashion and fine ExxonMobil food, has been confirmed with David Jones a major national fashion house set Eventbrite to establish its APAC HQ in Melbourne, 3,400,000 uprooting from Sydney. The move will Mars see the company make a $240 million 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 investment in Victoria underwriting Mondelez Source: ABS a major expansion of the company. Companies from all over the world, ASIAN COMPANIES WITH THEIR including numerous technology AUSTRALIAN companies, have celebrated success in government’s commitment to delivering surcharge on foreign investors at 7% and HEADQUARTERS IN VICTORIA Melbourne. Amazon, Facebook and a new AU$10.9bn underground, an annual land tax surcharge on LinkedIn are among the latest global high-capacity rail line servicing taxable value of 1.5% for those classified brands to lease space in the Melbourne Melbourne’s city centre and adjacent as an absentee person) are in addition Qenos Holdings Central Business District (CBD), and are education, health and research precincts. to the recently introduced application part of a wave of technology companies The new Melbourne Metro Rail line will fee payable to the Foreign Investment Toyota seeking office space in the city. In 2005, include a 9 km twin rail tunnel from the Review Board, as well as standard technology companies occupied 120,000 south of the city through to the local taxes for purchasing and Asahi Breweries sq m of CBD office space; today, this has University of Melbourne and health holding a property in Australia. increased to almost 200,000 sq m. The precinct in the north. The project will The new rules and taxes implemented AIA CBD office market was the best include five new and expanded by the federal government are designed performing office market nationally over underground stations. to encourage direct investment into new CITIC Resources the six months to January 2017, recording The attraction of Melbourne to housing, to increase supply and support net demand (110,000 sq m) of more than homeowners and investors has not been local economic activity. Evidence MTR Corporation three times its historical average. dampened by the state government’s suggests that foreign investment has not The lure of Melbourne as a place to live decision to revise taxes applicable to been deterred as the majority of buyers Source: Invest in Victoria and establish a business has been further foreign purchasers, including those investing in Australia are looking for a

THE AGE/GETTY IMAGES; IAIN MASTERTON/ALAMY IAIN AGE/GETTY IMAGES; THE heightened by the Victorian state buying in the city. These taxes (duty longer-term return with lifestyle benefits. 08 BRIEFING THE WEALTH REPORT – MELBOURNE EDITION 09

‘Certain universities are particularly popular among the UHNW community. Many UHNW alumni of these universities Where the smart are born outside the country, indicating that these institutions, money’s going based on their solid reputations, Serious foreign investors have been lured are able to attract students from to Melbourne because of its reputation around the world. The University as a business city on the global stage of Melbourne ranks as number three among Asia-Pacific UHNW undergraduates.’

Despite significant challenges across high net worth individuals (UHNWIs) wealth creation over the past 10 years, Source: Wealth-X global economic markets over the past – those with US$30m+ in net assets – with the number of UHNWIs growing by World Ultra Wealth Report decade, wealth creation has remained living in Melbourne increased by 12% 281%, and expectations of further growth strong in Australia and in Melbourne, in between 2015 and 2016. This is of 140% by 2026. Winston Chesterfield, of particular, with an improvement in the impressive when compared to competing leading wealth research house Wealth-X, labour market towards services. global cities Beijing (10%), Hong Kong sees this as an opportunity for Australia: The latest data on high net worth (6%), Singapore (6%), London (-5%), New ‘If the Chinese economy continues to be individual (HNWI) migration confirms York (6%) and Los Angeles (5%). strong, we’ll see further wealth growth in the strong attraction of Australia as Comprehensive global wealth creation both the HNWI and UHNWI populations a destination. Sydney (+4,000) and is forecast to continue, albeit at a slightly at significant levels in China. Australia’s Melbourne (+3,000) top the list of slower pace, with Melbourne expected proximity to China means HNWIs can HNWI growth markets, recording a 4% to see growth of 70% in its UHNWI still manage their business interests in annual increase. The list of global cities population by 2026. This is above the their home country from an Australian seeing an outflow of wealthy individuals figure projected for Australia, as the base. Education, lifestyle and tax is topped by European centres, with nation nears the end of the resources-led advantages are additional factors.’ Paris and Rome seeing outflows of growth it has experienced in the past As the global economy continues to The University of Melbourne is a significant draw for overseas students 7,000 and 5,000 HNWIs respectively 10 years. Despite the pace of UHNWI grow at a more moderate pace, China’s over the past year. growth slowing, Melbourne and Australia economic performance is forecast to According to data from New World boast the highest growth forecasts of all outpace most advanced economies, and Wealth, published by Knight Frank in developed cities and nations. wealth preservation will therefore grow The Wealth Report, the number of ultra Mainland China has seen enormous in prevalence. Wealth-X points out that succession and inheritance issues and taxes, are major areas of concern for rich NUMBER OF MILLIONAIRES, MULTI-MILLIONAIRES AND UHNWIs families. However, Australia’s favourable tax regime will heighten prospects. KEY Chesterfield says: ‘Australia has certain UHNWIs (US$30m+) tax advantages, particularly for HNWIs Multi-millionaires (US$10m+) and UHNWIs passing on wealth, for Millionaires (US$1m+) Australia example. Australia has no inheritance or gift tax, with all states also abolishing in 1979 what were known as death duties. This is in direct contrast to other OECD 3,340 countries, where inheritance tax is rather punitive.’ Melbourne offers a very attractive 10,550 lifestyle, with a strong cultural element. ‘Plus,’ says Chesterfield, ‘as a global city, it’s on the lower end of the density scale, providing relative serenity to the wealthy, who are often accustomed to living in densely populated cities. It also enjoys a relatively balanced climate, comparable to Europe’s, so investors see this as a familiar but easier way of life.’ 321,900 In addition, Melbourne has a deeply embedded, serious-minded culture with a strong business focus, making it attractive to investors. According to Melbourne research by Wealth-X, ‘It’s positioned as a business city on the global stage, one 900 which is functioning, growing environment that welcomes foreign 2,690 investors. ‘It is attractive to set up business here and there is a talented, 74,800 dynamic, educated young population with improving intellectual capital.’ Finally, foreign UHNWIs have been buying and investing in Australia since REX/SHUTTERSTOCK; LUCAS DAWSON PHOTOGRAPHY the global financial crisis – a sign of Source: New World Wealth / Knight Frank Wealth Report Melbourne has been on the up since the global financial crisis confidence in the underlying economy. 10 BRIEFING THE WEALTH REPORT – MELBOURNE EDITION 11

Fishermans Bend will undergo huge changes over the coming years, with residential and office developments taking shape

A city on the move Dynamic new infrastructure is creating exciting opportunities and changing the way residents will live, work and play

According to The Economist Intelligence stations – at Arden, Parkville, Domain Unit’s Global Liveability Ranking, those – and two new city stations (CBD North living in cities with better connectivity and CBD South) that will be directly have a better standard of living. In the connected to Melbourne Central and 2016 report, Melbourne again received Flinders Street. Domain will be an a perfect 100 for its infrastructure. The important interchange point, and will score takes into consideration a number improve access to existing business of indicators: quality of road network, precincts and growing residential areas public transport and international links. such as St Kilda Road and Southbank. To help retain Melbourne’s status as The aim of the project is to increase one of the world’s most liveable cities, the the capacity, reliability and efficiency of Victoria state government has committed Melbourne’s busiest train lines to allow to improving its already world-class for 39,000 more passengers to use the transport system. The Metro Rail project, metropolitan rail network during peak the core of the infrastructure strategy, hours. The new stations will help ease will deliver two 9 km rail tunnels congestion and improve access to public from South Kensington to South Yarra, transport, employment, education and travelling beneath Swanston Street in opportunity throughout Melbourne’s the central business district (CBD). The inner-city growth areas. Construction new underground system will include the will commence in 2017 and be completed development of five new and expanded and operational by 2026.

In addition to the rail project, the District in Boston, US. Fishermans Bend viability and future longevity. The Victoria government recently allocated is 1,125 acres in size – an area more than authorities in Melbourne have funding for the removal of 50 level twice the size of the city’s CBD – and revealed that the Parkville interchange crossings across Melbourne. This stretches along the Yarra River from being built for the Melbourne Metro will transform the way people travel Port Melbourne to Southbank. rail project is being designed to also across the metropolitan area, while Often described as the next chapter serve a future Metro2 link. Provisions also improving safety for both drivers in Melbourne’s growth story, it will are being made to enable the station and pedestrians. The crossings are support an estimated 60,000 jobs and to service a new link that will run considered dangerous and/or congested, a range of well-serviced, high-density Domestically and between Fishermans Bend and and at least 20 of them will be removed housing options for an eventual 80,000 globally, former Clifton Hill, increasing the by 2018, with the Victoria government people. It is anticipated that the new industrial sites are being connectivity of the precinct. having allocated AU$2.4bn in its urban-renewal precinct will become redeveloped to expand Melbourne requires more business 2015/16 budget for this purpose. a world-class location for technology, city centres, and these space, homes and amenities if its These infrastructure improvements education and research – jobs that will new areas have become economy and population are to continue are opening up new areas for both become an integral part of Australia’s popular as places to to grow in accordance with current residential and employment uses across service economy. Desirability and projections. Domestically and globally, both live and socialise Melbourne. Situated in the heart of the value-uplift of immediately surrounding former industrial sites are being city, the Fishermans Bend industrial areas, such as Southbank, should benefit redeveloped to expand city centres, precinct is an unparalleled urban- from the regeneration project. and these new locales have become renewal opportunity – a project akin In London, the Northern Line rail popular as places to both live and to the redevelopment of Barangaroo in extension was a game-changer for the socialise. Melbourne is certainly Sydney, and global benchmarks such as redevelopment of Nine Elms/Battersea, benefiting from this urban development Nine Elms/Battersea and King’s Cross as the new connections were a crucial trend, and new transport solutions A bright vision for the new Parkville Metro station in London, or the 1,000-acre Innovation component to the area’s desirability, should help support its growth potential. 12 LIVING THE WEALTH REPORT – MELBOURNE EDITION 13

Key topics

01 Five-star fare So stratospherically sophisticated is the food scene in Melbourne that in 2017 it hosted the prestigious World’s 50 Best Restaurants awards page 14

02 Place making Be it a cutting-edge residential design or a handsome heritage property, Australia’s second city offers a plethora of choice page 18

03 The wild side Little more than a boomerang’s throw from central Melbourne lies the most awe-inspiring scenery and its famous indigenous wildlife page 24

COFFEE

The world’s

$ most liveable city

Being named the world’s most liveable schools and universities in Australia, city once is a remarkable achievement. an exciting cultural and restaurant scene, But receiving the title six years in a row extensive and efficient public transport is truly extraordinary – especially when and admirable healthcare. It’s a the honour has been accorded by The compelling combination of factors. Economist Intelligence Unit. While Melbourne has the edge, it faces The Global Liveability Ranking rates competition for the crown from its South cities’ success across 30 areas, including Australian cousin Adelaide – which has environment, education, healthcare, been ranked fifth since 2012 (in fact it safety, stability, public services and tied with Calgary, Canada, for equal fifth infrastructure. In 2016, Melbourne again this year). Meanwhile, on the other side scored an astonishing full marks in of the country, Perth also made it into three of those – healthcare, education the top 10 again. and infrastructure – and 97.5/100 overall. Over the following pages, we explore A city on the doorstep of Victoria’s Melbourne in all its breadth, revealing natural beauty and abundant wildlife, it’s some of the most exhilarating things the home to some of the highest performing city has to offer. 14 LIVING THE WEALTH REPORT – MELBOURNE EDITION 15

raw red kangaroo with bunya bunya nuts – but through his tutelage. In 2016, TOP FIVE COFFEE SHOPS RESTAURANTS ex-Attica chef Peter Gunn opened his solo 1. Market Lane Coffee venture Ides, in Collingwood, which was With five locations, this boutique roastery and cafe named one of Melbourne’s best new is a leading light in the city. restaurants by Time Out. marketlane.com.au Tuck Shop Take Away is run by 2. Dead Man Espresso another Attica alumnus, Clinton Serex, Using Melbourne’s best roasters, Dead Man serves Five-star fare along with his wife Karina, who trained ace coffee and great food. as a pastry chef at The Fat Duck. This deadmanespresso.com.au Australia’s second-largest city is a unassuming cafe in Caulfield North gastronome’s delight, with phenomenal 3. Sensory Lab serves peerless jaffles (Aussie speak for For third-wave coffee food from right across the globe – not a toasted sandwich) as well as brilliant geekery, head to this hot to mention the best coffee anywhere spot on Bourke Street. burgers (tip: order the off-menu Bully). sensorylab.com.au If drinks are your thing, Melbourne’s STEFAN CHOMKA 4. League of Honest Coffee EDITOR, RESTAURANT MAGAZINE burgeoning bar culture is worth staying Chemex brew is a speciality up for. If you can find it (it’s hidden at this cool cafe, situated behind a sign-free door) Eau-de-Vie on Exploration Lane. leagueofhonestcoffee.com.au Canberra may be the capital of Australia, serves some of the best cocktails in 5. Brother Baba Budan and Sydney the country’s top tourist the city. Its 200-strong whisky selection Named after a 17th-century destination, but if it’s a vibrant, diverse also doesn’t disappoint – and yes, Sufi, this venue makes its CONNAN AILSA dining scene you crave, there’s only one Australian varieties do feature. Working coffee using an AeroPress. place to find it: Melbourne. your way through that alone will keep sevenseeds.com.au Home to the Melbourne Food and you busy. Dinner date Wine Festival, which attracts some 250,000 visitors each year, Australia’s For his first permanent restaurant outside the second city has become a global food UK, Heston Blumenthal chose Melbourne – hotspot. So much so that in 2017, it Pears in Maidenii vermouth at Attica, named Best Restaurant in Australasia a going-places city for a forward-thinking chef hosted the prestigious World’s 50 Best In 2017, Melbourne hosted the prestigious World’s Restaurants awards, making it only the 50 Best Restaurants awards, making it only the third city third city after London and New York Malaysian communities, all contributing Take Lûmé, which opened in 2015 in after London and New York to be granted the honour For proof that Melbourne is now recognised to be granted the honour in the awards’ to the city’s food scene. And yet there’s a terraced house in south Melbourne as a top culinary destination, look no further 15-year history. In April, it welcomed more to Melbourne than demographic that was formerly home to a burlesque than Heston Blumenthal’s decision to culinary colossi from around the world and culinary diversity. Over the past club. Here, chef Shaun Quade serves a temporarily relocate his famous UK-based and, for a time, was the epicentre of few years, it has overcome second-city multisensory tasting menu of unusual restaurant The Fat Duck to the city in 2015. global gastronomy. syndrome and stepped out of Sydney’s ingredients – think cow’s udder, cured The six-month pop-up saw the molecular But what is it that makes Victoria’s shadow. With its mix of Victorian and emu and calamari entrails. This really wizard recreate The Fat Duck’s brilliantly capital city so special when it comes to modern architecture and an edgy feel, epitomises the city’s current food scene: bonkers cuisine for a new audience, serving food? Well, Melbourne’s strength lies it is now regarded as the more innovative, confident, artful and quirky. much-talked-about dishes such as sound of in its diversity. It has one of the largest sophisticated and iconoclastic alternative Then there’s Bar Liberty in Fitzroy – the sea, hot and iced tea, and snail porridge, Greek-speaking populations outside to Sydney, attracting a young hipster a new-wave wine bar where the bottles for which he scoured the continent for the of Europe and is also home to large population in the process. And hipsters are wheeled around in an old-fashioned right kind of snails (ultimately unsuccessfully). Vietnamese, Indian, Sri Lankan and like to eat well. globe, and the BLT has become the Yet it’s what followed that really shows the GLT, with bacon replaced with gribenes, chef’s love for Melbourne, with the opening aka Jewish-style fried chicken skin. of an outpost of his multi-Michelin-starred It shouldn’t work, but in this super-cool Dinner by Heston Blumenthal in the city’s suburb, it really does. . That he opted for Melbourne However, while new restaurants are over the more obvious choices of New York or regularly launching, the city’s dining Dubai speaks volumes. scene isn’t reliant on the latest trends. At Dinner, rather than produce facsimiles Flower Drum, in central Melbourne, for of his well-rehearsed dishes as he did with his example, has stood the test of time since Fat Duck pop-up, Blumenthal has embraced 1975, when it opened to give Australians Australia’s rich bounty of ingredients and an authentic taste of Cantonese food, woven them into the tapestry of his menu. but with a local accent. Dishes such as Thus, his rice-and-flesh dish in Melbourne double-boiled wallaby-tail soup, wild features curried kangaroo tail in place of calf barramundi noodles and Robbins Island tail; his savoury porridge replaces the frog’s Wagyu-beef cheek grace the menu at this legs of the London menu with abalone; and well-loved urban institution. roast groper is substituted for turbot. No culinary visit to Melbourne would Melbourne is a fitting place for the chef’s be complete without a visit to chef-patron hyper-experimental cooking. Indeed, he Ben Shewry’s Attica, in Ripponlea, which ranks it alongside New York, Paris, London is currently ranked 33rd on the World’s and Tokyo as one of the top cities for food, 50 Best list and has been named Best drawn, he says, by its multicultural nature Restaurant in Australasia. New Zealander and energetic population. Shewry may technically be an outsider, Australia’s somewhat out-on-a-limb but he has left an indelible mark on the location has led to outward-looking diners city’s food scene, not just with his willing to devour new ideas and broaden their cerebral cuisine that references its palates. And nowhere is this more apparent The atrium at Lûmé, which serves an innovative multisensory tasting menu location – his signature dish is salted Market Lane Coffee, on Collins Street, which has its own roastery than here, in the continent’s food capital. 16 LIVING THE WEALTH REPORT – MELBOURNE EDITION 17

Hollywood’s red carpets with her This page, from top The 2016 Australian Open at the sophisticated spin on modern cocktail Rod Laver Arena in Melbourne; dressing and well-priced leather staples. Run for it: the city’s streets are On the accessories front, A-Esque fuses an ideal place to start quality materials and artisanal craftsmanship with punchy branding. Other Aussie names to track down at department stores David Jones and Myer include Ellery, NYC-based Tome, Dion Lee (for his precision tailoring and body-con dresses) and Kitx. Also add to the list Christopher Esber, Michael A place for movers Lo Sordo and Bassike (a brilliant unisex denim and basics brand). and shakers For a selection of the best international Australians are known for their passion accessories, stop by multibrand for healthy living. So it’s no surprise emporium Miss Louise, concept store Melbourne has some of the nation’s best Models backstage at the annual Virgin Australia Melbourne Fashion Festival Le Louvre, and the more outré Marais. spas, wellness facilities and gyms Those looking for something even more precious should drop into Paspaley, TALI SHINE city in on the act, and the Spring Racing which specialises in the world’s finest BEAUTY AND WELLNESS AUTHOR Melbourne à la mode Carnival in November. Much of the city’s pearls, from Australia’s Kimberley coast. From fashion festivals to international fashion scene is geared towards this Let’s not forget the boys: Melbourne’s luxury brands and independent sporting event, with milliners Viktoria premier destination for a curated Melbourne isn’t just about eating, boutiques, the city is one of the world’s Novak and Nerida Winter specialising in international buy and made-to-measure drinking and culture. Known as most exciting style destinations avant-garde hats worthy of topping the service with the likes of Tom Ford and Australia’s second city, Melbourne carnival’s Fashions on the Field accolade. Brioni is Harrolds. Nearby, local brand eclipses Sydney in terms of the number of KATRINA ISRAEL But when it comes to native talent, Calibre offers a more lifestyle approach, professional sporting events it hosts – the FASHION FEATURES EDITOR, WALLPAPER Scanlan Theodore is the place to shop. while Sneakerboy is renowned for its epic Australian Open, Melbourne Cup, The Melburnians take their morning and the track from Southbank to Docklands, This fashion-forward institution does selection. After a tailoring experience Ashes and Formula 1 Grand Prix provide lunchtime jogs. Located in the heart which passes through gardens, parks a polished, contemporary wardrobe with a difference? Head to P Johnson, an enticing calendar for sports fans. And of the metropolis, the 4 km-long Tan and alongside the Maritime Museum. The sartorial divide between Melbourne like no one else. For directional tailoring which specialises in lightweight, unlined suited to a city with sport on its mind, Track explores the King’s Domain and Fans of yoga can choose from many and Sydney is one of the refined and and beautifully draped dresses, Toni suiting perfect for warmer climates. Melbourne also has a wealth of spas, picturesque Botanic Gardens. If you’re varieties throughout the city, including urbane versus the relaxed and coastal. Maticevski has long been the prince Then, all that’s left to do is refuel – gyms and workout studios that creatively feeling more ambitious, there is the aerial, yin or hot yoga (try One Hot Yoga The former’s fashion heart is akin to that of the Melbourne fashion cognoscenti, after all, Melburnians are as passionate fuse different styles, meaning there’s 29 km (approximately four-hour) Capital or Grass Roots Yoga). Yoga 213 offers fun, of a European city: it’s a cosmopolitan the latter also earning him a big wedding about their food, wine and coffee as they always something new to try. Hula-hoop City Trail, which has the added benefit of energetic classes that fuse power yoga metropolis, with a cooler climate that business. Rebecca Vallance is another are about fashion. Check out Chin Chin training and paddle boarding, anyone? taking in all the city’s landmarks along with hip-hop or loud beats (exactly what encourages exceptional tailoring and Victorian currently scoring points on on Flinders Lane for starters. The cityscape itself is replete with the Yarra River and Inner Circle railway. you never knew you were missing). luxurious outerwear. manicured gardens and parks, where And there is a shorter option of cycling KX Pilates and KX Barre classes in Collins, Flinders and Bourke Streets the city centre are the place for high- – along with the smaller laneways that intensity, fast-paced, full-body-toning thread through the central business workouts that take just 50 minutes. district and High Street Armadale – Combining traditional reformer pilates are where most of the international and Melbourne’s fashion heart is akin to that of a European city: MELBOURNE’S MAJOR with cardio and endurance training, as SPORTING EVENTS local designer boutiques are centralised. it’s a cosmopolitan metropolis, with a climate that encourages well as ballet-barre options, these classes 1. The Australian Open Headline style events surround exceptional tailoring and luxurious outerwear Every January, Melbourne are both enjoyable and effective. March’s Fashion Festival, a consumer- plays host to one of the After all that exercise, you’ll need based programme that draws the whole world’s most prestigious somewhere to soothe those tired muscles, tennis tournaments – Australia’s Grand Slam. and luckily Melbourne is also home to some of Australia’s best spas. Natural 2. The Australian Grand Prix The motor-racing circus products and innovative treatments are comes to town in March Melbourne’s specialities, so why not Melbourne, so my plan was to move to the for four days of high- take a dip in the natural mineral spa at speed action. Incredibly, Shop talk city and set it up. Then a new opportunity Schumacher’s 12-year-old Hepburn Bathhouse & Spa, or visit the came along to open another store, at The Star lap record still stands. eco-conscious Aurora Spa Retreat at The James Kennedy, group CEO at Emerald Group casino in Sydney. That was the big change 3. The Melbourne Cup Prince hotel? Alternatively, check out the Investments, explains how his past has informed for me: all of a sudden it was two stores, and The 156-year-old, 3.2 km spas with the most breathtaking city they opened a month apart. The end results race is celebrated in style views, such as Crown Towers and, its the future of his luxury-retail business each November with family solidified my relationship with the brands, day, women’s day and, of sister hotel, Crown Metropol, or the which was important as I was so new to it all. course, high-stakes racing. Chinese-inflected and luxurious Chuan Before entering the family jewellery business, Diversification was key as the business 4. Melbourne Cricket Ground Spa at The Langham. I’d had a successful career in finance. I had evolved, not only in acquiring more brands, This is the city’s most lively And as for circus skills, the National sporting venue, hosting worked on the shop floor of our Sydney store but in looking at other areas, too. Technology international test cricket Institute of Circus Arts is in Melbourne, when I was younger, but it was the Basel watch was first with Bang & Olufsen, and fashion (including The Ashes), where you can take a three-year degree fair that really opened my eyes to the industry. was next – last December we launched one-day internationals, club in the subject if you wish. Or head to The and interstate competitions. At that time, LK Boutique was quite a a standalone Loewe store in Chadstone, Circus Spot for something more casual. simple business, with two stores and two Melbourne. I’m a big believer that luxury items Whether you want to work up a sweat brands – Patek Philippe and Rolex. Mum was are always quality products. My parents or just relax, Melbourne has luxurious, still running the Sydney store and had been taught me the value of humility, and gave fun and creative options for everyone.

having conversations to open a new site in me the tools to run a successful business. IMAGES KHAN/AFP/GETTY SAEED PHOTOGRAPHY; KARON IMAGES; ANDERSON/GETTY COLIN All it takes is a spirit of exploration. 18 LIVING THE WEALTH REPORT – MELBOURNE EDITION 19

materially rich contemporary houses, and are reinventing the city’s suburbs as a place of light, space and innovation – Place making and garnering substantial international acclaim as they do so. Proving that, if you build it, they will Melbourne looks set to add more come, the city’s architecture has created architectural trophies to its skyline in the a stellar stage for business and culture future, with approval recently granted JONATHAN BELL for the 242 metre Jean Nouvel-designed EDITOR-AT-LARGE, WALLPAPER tower at 383 La Trobe Street. Complex layered fenestration – part-inspired by the work of the great American architect Although Australia’s most recognisable was usurped by a new scheme by British buildings. Locals Ashton Raggatt Frank Lloyd Wright – will ‘animate’ modern building is in Sydney, Melbourne architects WilkinsonEyre. Described by McDougall are the city’s pre-eminent the building for passing visitors, has always been at the centre of the the firm as ‘three interlocking plectrum cultural architects, and their prominent although the main structure follows country’s architecture scene – a place shapes’, the 325 metre structure will suite of concert halls and theatres the French architect’s recent predilection where the grand corporate gesture house almost 700 apartments and a includes the Melbourne Recital Centre, for glassy austerity. adjoins the creative and the eccentric. 388-room six-star hotel, and have a public MTC Southbank Theatre and Hamer Another major project in the planning The likes of Denton Corker Marshall, observation deck on its upper levels. Hall Arts Centre. All present a very is the revitalisation of the Malt District Woods Bagot and John Wardle Architects Closer to the ground, Melbourne Antipodean – some would say uniquely – a former brewery site in the eastern have built extensively across the city, has retained much of its architectural Melburnian – take on architectural district of Cremorne – with the prospect garnering global acclaim for buildings heritage, most especially on Collins deconstruction, with faceted forms, of a billion-dollar property overhaul such as the Melbourne Museum and the Street, the city’s main thoroughfare, angular surfaces and a dense array The widely lauded Federation Square, Sean Godsell and the next will be built by courtesy of the aforementioned Fender Melbourne School of Design, with its where Victorian gems adjoin new of different colours and materials. planned by Lab Architecture Studio acclaimed Indian firm Studio Mumbai. Katsalidis. New housing, retail space soaring interior. Residential towers and , encapsulates the Melbourne’s future as an architectural and offices will share a site that mixes are also on the up, including Wardle’s city’s joyfully chaotic collage aesthetic. hotspot is set to continue with the future refurbished industrial architecture with award-winning QV1 building and Fender In a similar vein are the assemblage of development of 600 Collins Street – a new-build. Such big sites are few and far Katsalidis’s in Southbank, Melbourne has retained much of its architectural heritage, fractal-inspired façades enveloping a new multi-use tower by Zaha Hadid Architects between, yet brim with potential in a city which, when completed in 2018, will most especially on Collins Street, the city’s main thoroughfare, public space close to the railway station with 420 apartments set behind its fluid, that still delights in the unconventional. complement the studio’s . where Victorian gems adjoin new buildings and CBD, and Lyons Architects’ Swanston lattice-like façade. Rising 178 metres Bates Smart’s original proposal for the Academic Building – a pixelated riot that above the popular district, it will be Queensbridge tower (opposite, below) delights and confuses the eye with its studio’s first project in the country. proximity to other structures. As well as architecture’s big guns, Small-scale works still find their way Melbourne is home to numerous small into the public realm, too. The temporary firms, and cutting-edge residential design pavilion in Queen Victoria Gardens, flourishes in fashionable neighbourhoods Clockwise from far left created by British architect Amanda such as Fitzroy North. Here, architecture The Royal Exhibition Building, built Levete, arose out of the ongoing desire practices the likes of Edwards Moore, in 1880; Federation Square, a modern to commission one-off structures for Dan Gayfer Design, Andrew Simpson piazza that’s become the heart of entertainment and the arts in the park. and Austin Maynard Architects all have Melbourne; and an artist’s rendering The first was designed by Melburnian burgeoning portfolios of modest yet of WilkinsonEyre’s

within one elegant glass shard will encompass High achiever a hotel, residences and a central core rising from a luxurious lobby brim-full of amenities. Property and finance writer Catherine Moye on A walkway will link this to further the landmark development changing the skyline entertainment facilities and restaurants in an existing complex owned by Crown Hotels. When a city is as much on the rise as The building’s tapering form will slant Melbourne, you have to be exceptional to upwards to a point, where the two side towers stand out. That’s why the planned 325 metre will stop. The central one will continue to form One Queensbridge – scheduled for completion an impressive pinnacle. The angled panes of in 2021 – is one of its most hotly anticipated glass – some of them opaque to give the whole developments. However, it stands out for a ripple effect – will reflect city, sky and river, far more than its height. amplifying the eye-catching façade. ‘If you stuck a pin right in the middle of the But it’s not only generous on the outside – city’s central leisure, corporate and cultural homes range from 90 sq m for a one-bedroom activity, this location would be it,’ explains apartment to 230 sq m for one with three Paul Baker, director of WilkinsonEyre. ‘It’s bedrooms. ‘The idea is that you can live in a brilliantly sited, looking north towards the spacious environment more usually found in city centre and south to the ocean.’ a country home, but within walking distance of ‘A building’s a complicated thing,’ says everything Melbourne has to offer,’ says Baker. Baker. ‘We think about it being contextually In short, One Queensbridge offers choice. appropriate, working within environmental Residents can use the development as a constraints and how it relates to its neighbours.’ stage for enjoying the best the city has to Subject to planning approvals, three offer, or simply relax in their spacious home,

SCOTT BARBOUR/GETTY IMAGES; IDP AUSTRALIA COLLECTION/ALAMY dynamically interlocking towers encased contemplating the breathtaking views below. 20 LIVING THE WEALTH REPORT – MELBOURNE EDITION 21

Melbourne’s roots as Australia’s artistic of Aboriginal art – and the Australian Malthouse Theatre, is a contemporary Artful and cultural centre run deep. Well before Centre for the Moving Image. A gathering drama-and-dance venue set within EDUCATION manoeuvre the country’s first significant influx space and the location for many of the a renovated brewery. The very fact that of European settlers, the indigenous city’s cultural festivals, Fed Square, as it’s Theatre remains a cultural mainstay one could go Australia’s second city it may population was producing great works known, is the place to start an arts tour. for the city, offering both avant-garde on ad infinitum be, but Melbourne long ago of art – a tradition that still flourishes On the tree-lined boulevard that and mainstream local and international listing the city’s secured the right to call itself today and forms an essential part of is St Kilda Road, across the Yarra river, productions throughout the year. cultural hubs the country’s capital of culture the city’s vibrant cultural scene. is the country’s oldest and largest The Melbourne Theatre Company and merely underlines One of the most exciting ways to museum of art, the National Gallery of Southbank Theatre are both in the JACQUIE BYRON its artistic experience Melbourne’s art history is Victoria. Beyond its striking moat are St Kilda Road precinct, while the grandes WRITER AND CREATIVE COMMUNICATOR credentials to walk one of the Bayside Coastal Art international blockbuster exhibitions dames of the Victorian era are back in Trails, which stretch the 17 km from and smaller, more bespoke offerings, the CBD – the likes of The Regent, The Brighton to Beaumaris along one of as well as a permanent collection. Princess, The Comedy and Her Majesty’s the city’s most picturesque coastlines. This is a glorious cultural precinct, combine performance with pomp. Here you can admire indigenous art dominated by the iconic spire of the For live music, meanwhile, the Palais inspired by the stories of Carolyn Brigg, Arts Centre, within which are a number Theatre, Prince Bandroom, the iconic an elder of the Boon Wurrung people, of performance spaces, including Corner Hotel, or the beautiful Forum and gaze over the same landscapes Hamer Hall, the State Theatre, the Theatre in the centre of town are the that have inspired artists for centuries. Playhouse and the Fairfax Studio. places to head to. The last of these has The trail also affords the opportunity Expect to see everything from Wagner’s a ceiling of twinkling stars and has to admire the work of the Heidelberg Ring Cycle or the Australian Ballet played host to musicians as celebrated School – the first significant artistic performing Nijinsky, through live music as David Bowie and Madonna. It is closed movement of European settlers in of all kinds, to an exhibition of Kylie for refurbishment, but will be back – no Australia, including work by Charles Minogue’s stage costumes. doubt with a bang – later in 2017. Conder, Frederick McCubbin, Arthur Take a short stroll and you’re at the The independent gallery scene Streeton and Tom Roberts. Australian Centre for Contemporary Art flourishes in Melbourne – drop by Fehily Back in the centre of Melbourne, (ACCA) – the only major gallery in the Contemporary, the Murray White Room, Federation Square – an architectural country that focuses on commissioning Anna Schwartz Gallery, Nellie Castan statement in its own right – forms the rather than collecting. The structure Gallery or Tolarno to see work from anchor of the art scene. It houses the itself – a rusty steel façade designed by new and established local artists alike, Class act Ian Potter Centre – the National Gallery local architects Wood Marsh – hints including John Wolseley, Jon Campbell, of Victoria’s Australian collection, at the exciting art experience awaiting Louise Hearman, Nicholas Mangan Education plays a central role in Australia’s which includes a sizeable representation inside. ACCA’s nearest neighbour, the and Mirka Mora. Or, if authentic and prosperity, and Melbourne’s schools, colleges ethically sourced and sold Aboriginal and universities have reputations that more artwork and crafts from local makers is than speak for themselves more your bag, visit Koorie Connections Altair or Flinders Lane Gallery. The city’s standing as a centre of knowledge The very fact that one could go on continues to grow, and the substantial ad infinitum listing the city’s cultural population of local and overseas students hubs merely underlines its artistic now calling it home adds to its strong cultural credentials. From the vast, state-owned and academic credentials. The influx of Melbourne Museum to the small, students from Asia and elsewhere has also privately run Jewish Museum of energised and enlarged its dynamic food Australia, each one challenges scene and increased social diversity. convention and stimulates Located in and around Melbourne is conversation – which is precisely how Australia’s most respected university, some Melburnians like it. superb primary and secondary schools and a number of really innovative clinical and research bodies. Two of the country’s most influential A CITY OF FESTIVALS tertiary institutions, the University of Melbourne and the Royal Melbourne Institute of Technology (RMIT), are to be found right Melbourne has a reputation as a city of in the heart of the city, on campuses that festivals, and justifiably so. During White Night in February, for instance, Melburnians offer a rich mix of education, entertainment in their thousands hit the streets to and sporting and dining facilities. witness spectacular illuminations and Established in 1853, the University of performances. At other times of year, there Melbourne is internationally recognised and are prestigious international festivals of comedy, film, jazz, flowers and gardens. research-intensive, and attracts students The Melbourne Writers Festival is the star from more than 150 countries. RMIT is in the of the winter calendar. Other standouts world’s top-100 universities when it comes include the world-renowned multi-arts to electrical and mechanical engineering, Melbourne Festival, the Fringe Festival, and Midsumma, the annual LGBT accounting, finance, computer science and celebration. The city’s multicultural information systems. character is also reflected: the Chinese Melbourne’s Monash University is also dragon dances his way through the streets highly regarded. A research institution at Chinese New Year, Greek food and Opposite and this page, heritage is celebrated every February, and from left The futuristic Edge with six campuses across Victoria and two cinephiles can indulge in weeks of Italian, Theatre at dusk; the state-of- more internationally, it is a member of the Jewish and Scandinavian films in the winter. the-art radiation-therapy unit prestigious Group of Eight – an alliance of

ESCH COLLECTION/GETTY IMAGES; LUCAS DAWSON at Melbourne Medical School leading Australian universities. 22 LIVING THE WEALTH REPORT – MELBOURNE EDITION 23

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Land of plenty

From the rugged beauty of the Grampians and Phillip Island 14 to the soaring of the central city, Melbourne and its environs offer a lifestyle like no other

1. The Grampians 2. Hepburn Bathhouse & Spa 3. Melbourne Airport 4. Macedon Ranges Wine Region 16 5. 600 Collins Street 6. One Queensbridge 7. Crown Casino 8. Australian Centre for Contemporary Art 9. Laneways 17 15 10. University of Melbourne 11. 12. Melbourne Cricket Ground 13. Rod Laver Arena 14. Melbourne Grand Prix Circuit 15. Phillip Island 16. Great Ocean Road 17. Bells Beach 24 LIVING THE WEALTH REPORT – MELBOURNE EDITION 25

Clockwise from opposite, far left The Twelve Apostles from the Great Ocean Road; the dramatic lookout from the pinnacle in Grampians National Park; painted huts on Brighton Beach; one of Wilsons Promontory’s koala bears; Phillip Island’s dramatic terrain

WILSONS PROMONTORY About 200 km southeast of Melbourne, Wilsons Promontory – also known as The Prom – is an open-air menagerie of marsupials, where koalas, wombats and wallabies scarcely bat an eye as you pass by on mountain bikes, and you can ramble along shorelines so immaculate the rounded-quartz sand squeaks underfoot. A nature lover’s nirvana. The wild side MORNINGTON PENINSULA From beautiful beaches and rugged Visit peaceful Mornington Peninsula, ranges to curious-looking creatures, just an hour southeast of the city, to take Victoria has natural wonders aplenty. a horseback tour along golden sands Here are eight of the best as turquoise waves lap at your steed’s JAMES DRAVEN hooves. Riding tracks wind their way TRAVEL EDITOR through both beach and bushland and conclude with you stepping your own feet into the geothermally heated waters of THE GREAT OCEAN ROAD PHILLIP ISLAND Peninsula Hot Springs. Just an hour from central Melbourne, Famous for its twilight parade of little the Great Ocean Road snakes west along penguins marching homeward from PORT PHILLIP BAY a shoreline that puts Italy’s Amalfi Coast the ocean each evening, Phillip Island, Pristine Port Phillip Bay is the place to to shame. The improbable pillars of the southeast of the city, also offers the slap on your snorkel and swim with some famous Twelve Apostles limestone opportunity to see one of Australia’s wonderfully weird weedy seadragons. stack formations are among the many largest wild colonies of fur seals. Seal Koalas, wombats Those looking for a close encounter with incredible sights that line the 240 km Rocks is just over a mile from its rugged and wallabies something a little less alien can take route, which also offers surfing beaches southwest corner, where tour boats an award-winning marine-mammal scarcely bat an eye so spectacular that some visitors skydive drop anchor within yards of thousands eco-tour that offers small groups of above them to get the best views. of seals enjoying the sun. as you pass by on visitors the chance to come face to face mountain bikes, with wild bottlenose dolphins. THE GRAMPIANS GIPPSLAND LAKES and you can ramble A fantastic area for hiking, the majestic If being out on the water floats your along shorelines MURRAY-SUNSET NATIONAL PARK ranges of the Grampians offer a network boat, why not head to the Gippsland so immaculate Do not adjust your specs! Owing to a rare of sylvan treks of varying lengths, Lakes, the largest inland waterway the sand squeaks set of conditions, harmless algae in the rewarding climbers and walkers with system in Australia? Separated from underfoot lakes of northern Victoria’s Murray-Sunset local wildlife sightings, roaring waterfalls the sea by the narrow strip of sandy National Park release carotene into the and ancient Aboriginal rock art from dunes known as Ninety Mile Beach, water, turning the lakes flamingo-pink back in the days when this magical place the three interconnecting lakes – each summer. You needn’t even stray that was known as Gariwerd. Breathtaking Victoria, King and Wellington – are a far from the city, though: since December trails often culminate on cragged peaceful spot to fish or to hire a vessel 2012, the saltwater lake in Melbourne’s escarpments that provide sweeping and languidly bob past black swans Westgate Park has been putting on the

vistas of the verdurous Victoria Valley. and ponderous pelicans. same psychedelic display. INGO OELAND/ALAMY; BOY-ANNPONG/GETTY IMAGES; PHILLIP MINNIS/ALAMY 26 INSIGHT THE WEALTH REPORT – MELBOURNE EDITION 27

Arrivals Key topics 01 Immigration An introduction to the Significant Investor Visa programme, and the reasons it’s considered attractive page 28

02 Tax Bricks and mortar are a sound investment, but what are the possible tax implications? page 29

03 Education Whatever level of education you’re considering, Melbourne boasts a world-class system page 30 $ $

Meet the experts

Due to Melbourne’s favourable market more people are choosing to move to conditions in a global context, and the Australia. George Pakis, director at fantastic lifestyle on offer, it is no Moore Stephens, the international wonder more people are looking to buy accountancy and financial-advice property in what is officially the world’s specialist, gives an account of the most liveable city. While the benefits are various taxes and costs you should be apparent, the implications of relocating aware of when buying property in to another city or country are numerous Australia, and how these differ for and sometimes perplexing. In this non-citizens. Finally, education section, you will find the advice of consultant Christine Jenkins, who was experts in three areas vital to consider Principal of Korowa Anglican Girls’ when relocating: immigration, tax and School for 12 years, assesses the finance, and education. Having the Australian education system. Jenkins insider knowledge of specialists could explains why Australia is increasingly make a move much smoother. attractive with HNWIs seeking to Immigration-law specialist Teresa educate their children. She also lists the Liu of law firm Fragomen describes the most highly regarded schools and various visas on offer to high net worth universities, while considering the future individuals (HNWI), and explains why of education and migration in Australasia. 28 INSIGHT THE WEALTH REPORT – MELBOURNE EDITION 29

ESTIMATED PROPERTY PURCHASE COSTS Tax All costs represented in AUD

Purchase price $750,000 James Tng is a director at Moore Stephens, a taxation and business advisory service Stamp duty (off-the-plan discount) $20,050 Immigration Land transfer $1,400 Legal fee (includes GST payable) $1,500

Mortgage application fee $400 Teresa Liu is an immigration Around 75 to 80% of the non-resident component and not on its completed lawyer and partner clients we work with are purchasing new value. For example, if you buy on the 37th Resident estimated total $23,350 residential property in Melbourne, rather floor of a building, your land component with international law Foreign investor application fee $5,000 firm Fragomen than an established home. This is partly is low, so you pay much less stamp duty. because the purchase of an existing home This is especially significant now as Foreign investor purchaser fee $22,500 by non-residents is difficult and often the Victoria government charges foreign not permitted by the Foreign Investment residents an additional levy on top of Non-resident estimated total $50,850 Review Board (FIRB). But the purchase of stamp duty; this rose from 3% to 7% on When moving to Australia, high net off-plan and new-build property is per- 1 July 2016. Only paying the extra 7% on Note: this worked example is an estimate only, with approximate fees. It is highly recommended worth individuals (HNWI) would mitted. Another reason investors favour a new build’s land component rather than that you engage a solicitor or conveyancer during typically use the ‘Business Innovation new builds is the considerable savings in the total value of an established home is the purchasing process and Investment Programme’, which was stamp duty. In Australia, state and terri- more easily absorbed into purchasers’ established in 2012. This visa includes tory governments levy stamp duty, not cost structure. As a result, the apartment four separate streams, the most popular the Federal Government. market in Melbourne has avoided some of which is the Significant Investor In Victoria, stamp duty is calculated of the fallout of the stamp duty increase. duty discounts for properties valued up Visa (SIV), open to people willing to on a sliding scale from 1.4% for the first In March 2017, the Victorian to AU$750,000. Non-resident owners who invest at least AU$5m in ‘complying AU$250,000 to 5.5% for properties over government announced a stamp duty do not plan to rent their properties also significant investments’ in Australia. AU$960,000. But when you buy off-plan, exemption for first owners buying need to be aware of the new vacant The SIV is a four-year visa, the you pay stamp duty only on the land property below AU$600,000 and stamp property levy of 1%. As for federal taxes, attraction of which, especially to people you will be liable for capital gains tax and coming from Asia, is that there’s no income tax on rental income. The SIV programme has historically seen double restriction or English-speaking The income tax rate for residents and requirement. The move to permanent- number of applicants looking to migrate to Melbourne than non-residents is levied on a scale. If you residency status is also substantially less to Sydney. This testifies to the city’s quality of healthcare, earn up to AU$80,000 in rental income onerous than under other visa streams. education, culture and environment after deductions, the tax rate is 32% In July 2015, however, the government for non-residents. Capital gains tax is made changes to what constituted a separate tax levied on any profit made ‘complying significant investments’ from the sale of an asset, including under the SIV programme. The intention remainder can be invested elsewhere. 79 SIVs were granted under the July 2015 property. Unlike Australian citizens, was to drive finance away from passive From July 2015 until February 2016, rules. But as of 31 December 2016, 1690 non-residents are not eligible for the investment such as government bonds only a handful of SIV applications were SIVs have been granted since the start of 50% discount if they sell a property. and into more entrepreneurial sectors lodged and approved. That was because the programme in November 2012. The capital gain is added to the other aimed at promoting economic growth. the changes happened suddenly, so the The SIV programme has historically income of the owner and taxed at Broadly speaking, this means a market has been playing catch-up. We seen double the number of applicants the relevant tax rate. percentage ($500k) of the AU$5m now have seen a significant pick up in interest looking to migrate to Melbourne than to You can claim back many property- has to be invested in venture-capital as the market has adjusted and Sydney. This partly testifies to the city’s related costs against rental income, firms or small private companies, and particularly since the middle of 2016. quality of healthcare, education, culture including interest on a loan, management $1.5m in emerging companies. The Between July 2016 and December 2016, and environment. It is especially fees, council and land taxes. There is also attractive to people from China, from a significant deduction available for the where about 90% of SIV applications depreciation of the property, fixtures and originate, closely followed by Hong Kong, fittings and household effects. Malaysia, Vietnam and South Africa. Other fees involved in the buying VICTORIA’S INTERNATIONAL STUDENT POPULATION Substantial numbers of Chinese have process include legal and conveyance Total number of enrolments, across all education levels, year to date been moving to Melbourne ever since the fees, which range between AU$500 so-called Victorian gold rush in the and AU$3,000, and land transfer fees. mid-19th century. Many of the new There are also FIRB application fees migrants already have family here. required upon purchase. China 68,060 As far as Western Europeans are Finally, when acquiring a property, concerned, those HNWIs looking to move consideration should be given to the India 34,001 to Melbourne do so for lifestyle reasons. long-term strategy: what is the purpose It’s no accident Melbourne was named and intention for the property? Should Malaysia 13,034 the world’s most liveable city for the sixth you borrow money? Should you buy it year running in 2016. through a discretionary family trust?

Vietnam 12,999 Applicants from Europe, especially All these considerations go hand in the UK, are also attracted to the idea of hand with the acquisition of the dual citizenship, which is recognised by property so the most efficient tax Australia. And in light of Brexit, we expect and investment structure can be Source: Knight Frank Research, Department of Education & Training, November 2016 to see more applications from the UK. determined beforehand. 30 INSIGHT THE WEALTH REPORT – MELBOURNE EDITION 31

start thinking about educating their Melbourne Institute of Technology RANKING OF UNIVERSITIES TOP PERFORMING IN VICTORIA children overseas when they are around (RMIT) are growing in popularity, and, 14 or 15, though the students may not as they increase their range of courses, Performance of Melbourne schools come until they are 16 or 17 years old. are becoming far more widely known. 1 University of Melbourne China will not grant students an exit There is some risk of growing 1 Melbourne High School South Yarra visa unless their English language has competition to Melbourne’s educational 2 Monash University reached a reasonable standard, which institutions. The more Western approach 2 Mac.Robertson Girls’ Melbourne is the reason Chinese students joining to education is starting to have an impact 3 RMIT University 3 Melbourne schools tend to be in their in Singapore and Japan. This process will Nossal Berwick mid-teens, as opposed to pre-teens. take much longer in China, as demand for 4 Deakin University 4 Year 11 or 12 in an independent places there is high and the incentive for Suzanne Cory Werribee school will cost around AU$20,000 per change less pronounced. 5 La Trobe University 5 year, plus living expenses, books and Having said that, the past decade has Presbyterian Ladies’ Burwood healthcare. Boarding-school fees are seen a huge increase in the middle class 6 Swimburne University around AU$45,000 per annum, but much in China. Their desire to give their 6 Korowa Glen Iris

of Technology greater support is provided, of course. children the best opportunities possible 7 The advantage of Western-style looks set to produce growing demand Fintona Girls’ Balwyn 7 Victoria University education is it develops students as for secondary-school and university 8 individuals: it does not take a one-size- places in Melbourne. Camberwell Grammar Canterbury 8 Federation University 9 Scotch College Hawthorn 9 University of Divinity 10 Haileybury College Keysborough Source: QS World University Melbourne offers a superb standard of teaching. Rankings 2016/17 Education here is not cheap, but while the exchange rates Source: Better Education 2015 are favourable, the positives outweigh the negatives

fits-all approach to learning. Instead, Many families based in China and teachers try to adapt to the level of Thailand also seek the benefits that an the students, both academically and Australian lifestyle offers, so migration personally. Students from Asia and for the whole family is keenly sought China typically find they are also if permanent residency or business expected to speak up more in class and migration can be obtained. interact more with their teachers and Some families will look to buy classmates, which they find refreshing. apartments for university-age children The final two years of secondary or, indeed, the whole family. If that is the school in Melbourne lead to the Victoria case, then Melbourne’s central business Certificate of Education (VCE), which is district is their best option, as it is a hub for awarded to students who successfully education, facilities and public transport. complete their secondary education. This makes it much easier for them to gain entry to local universities. The VCE is TUITION FEES less exam-focused and very broad and flexible. Its only compulsory aspect is 2017 Annual fees in top-performing Melbourne independent schools that students can speak English as a first or second language. Students prepare Secondary schools Suburb Format Indicative tuition fees THE SIMPLIFIED STUDENT portfolios and do other assessed tasks, Education Melbourne Girls’ Grammar South Yarra Girls $33,220 VISA FRAMEWORK then have one exam at the end of Year 12. Universities in Melbourne also offer Melbourne Grammar Melbourne Boys $31,680 Christine Jenkins is an education a wide range of high-standard, flexible Since 1 July 2016, the Simplified Student courses. They have very few barriers to Lauriston Girls’ Armadale Girls $30,852 specialist based in Melbourne Visa Framework (SSVF) replaced all entry for foreign students beyond the previous eight student visas to allow English-language requirement. Aside PLC Burwood Girls $30,720 study in Australia. Under the SSVF from that, universities judge solely on there are two subclasses only: Trinity Grammar Kew Boys $30,660 merit, regardless of whether students As an education consultant, I see a Secondly, Melbourne offers an extremely STUDENT VISA are looking to study law or medicine, International students can apply for a Korowa Anglican Girls’ Glen Iris Girls $29,500 lot of families and young people who high quality of education, with a superb single student visa, regardless of their the arts or business. International are attracted to Melbourne. Most are standard of teaching and learning in chosen course of study. students see the University of Melbourne MLC Kew Girls $28,020 from mainland China and Hong Kong, schools and at universities. Parents and Monash University as the top two STUDENT GUARDIAN VISA Camberwell Grammar Canterbury Boys $27,535 although I have advised people from see this as a guarantee of a positive Student guardians can apply for the in the state of Victoria. The former has new Student Guardian Visa. The SSVF Taiwan, Japan and Germany. outcome for their investment. Education a reputation as a global leader, but does Scotch College Hawthorn Boys $26,000 They are keen on Melbourne for two here is not cheap, but while the exchange is designed to make the process of not offer direct entry to medicine or law. applying for a student visa simpler to reasons. Firstly, it is seen as a safe city rates are favourable, the positives navigate, as all applications for student Monash also offers high-quality Loreto Mandeville Hall Toorak Girls $25,750 that is also cosmopolitan and lively. outweigh the negatives. visas must be completed online at education and teaches a huge number border.gov.au/Trav/Visa/Immi That makes it attractive to young people, Starting with school-aged children, of courses across several campuses. Source: Knight Frank Research, School Admission Websites, based on year 9 students and reassuring for their parents. Chinese families, for example, typically Deakin University and the Royal *Other expenses may be charged in addition to tuition fees

LAST WORD 32

There are many reasons to want to purchase property in Melbourne, but it is the city’s highly ranked quality of life that attracts most residents. This success has led many cities to attempt to emulate it. But a concept as complex and imprecise as quality of urban life resists simple definition – it’s not something that can just be bottled and prescribed as an easy panacea to the world’s metropolitan ills. This desire to learn from the success of others The Melbourne Knight Frank Residential Property Enquiries The Melbourne Edition, neither is a topic we consider in the latest edition of Knight Edition GLOBAL HEAD ERIN VAN TUIL Knight Frank nor any other person Frank’s Global Cities Report, our sister publication OF RESEARCH +61 (0)409 325 700 is providing advisory, financial or LIAM BAILEY [email protected] other services. In particular, Knight to The Wealth Report. The starting point for many COMMISSIONED BY Frank LLP is not authorised by ANDREW HAY is to recognise that few places are blessed with HEAD OF RESIDENTIAL the Financial Services Authority the inherent geophysical advantages of, say, RESEARCH to undertake regulated activities WRITTEN BY Melbourne, London, New York or San Francisco. AUSTRALIA (other than limited insurance KNIGHT FRANK RESEARCH However, a number of cities are finding they can MICHELLE CIESIELSKI intermediation activity in connection Disclaimer with property management). nonetheless nurture an economic environment DESIGNED BY DIRECTOR OF RESEARCH & Knight Frank LLP also trades that encourages an improved quality of life. SHOW MEDIA CONSULTANCY The Melbourne Edition (The Wealth as Knight Frank. Knight Frank LLP Culture, education Miami, for example, has focused on high-end AUSTRALIA Report, © Knight Frank LLP 2017) is a limited liability partnership residential development as a catalyst for innovation PRINTED BY PAUL SAVITZ is produced for general interest registered in England with registered CARBON8 PTY LTD in the retail and design industries, whereas Dubai’s only; it is not definitive and is not number OC305934. Our registered and quality of life: RESIDENTIAL DIRECTOR intended to give advice. It must not office is 55 Baker Street, London W1U skill at urban repositioning focused initially on AUSTRALIA be relied upon in any way. Although 8AN, where you may look at a list of duplicating Melbourne’s tourism following the financial crisis, before ERIN VAN TUIL we believe that high standards have members’ names. widening into the creative sectors of the economy. been used in the preparation of The Melbourne Edition is compiled global appeal isn’t easy One of the critical challenges for city authorities Show Media the information, analysis and views from information contributed by presented in The Melbourne Edition, various sources, including Knight is ensuring their top-down approach to regeneration ART DIRECTOR no responsibility or liability Frank LLP, its direct UK subsidiaries JON MORGAN doesn’t undermine the authenticity that talented whatsoever can be accepted by and a network of separate and workers demand from their working and living Knight Frank for the contents. We independent overseas entities or Liam Bailey DESIGNER environments. As we note in the Global Cities make no express or implied warranty practices offering property services. Definitions TOM ROBINSON Global Head of Research Report, how do you create creativity? or guarantee of the accuracy of any Together, these are generally known UHNWI of the contents. As far as applicable as ‘the Knight Frank global network’. [email protected] Employing culture and education as a means PICTURE EDITOR We use UHNWI as an laws allow, we do not accept Each entity or practice in the Knight AMY WIGGIN +44 20 7861 5133 to encourage diversification of land use and abbreviation for ultra- responsibility for errors, inaccuracies Frank global network is a distinct and broaden the appeal of a city is well established, high-net-worth individual – or omissions, nor for loss or damage separate legal entity. Its ownership CHIEF COPY EDITOR with Melbourne a stand-out exponent. Where art someone with a net worth that may result directly or indirectly and management is distinct from LUCY FRITH or museum quarters lead, retail and restaurant of over US$30m, excluding from reliance on or use of its that of any other entity or practice, culture follows and economic growth is likely to their primary residence. contents. The Melbourne Edition whether operating under the name COPY EDITORS does not necessarily reflect the Knight Frank or otherwise. KRISTIN BRAGINETZ be encouraged. Universities, in particular, have a PRIME PROPERTY view of Knight Frank in any respect. In any event, no entity or practice POLLY DENNISON real ability to encourage commercial development, The most desirable and Information may have been provided operating under the name Knight attracting high-skill employment. most expensive property by others without verification. 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