Alexandrina Council Hindmarsh Island Economic Development Forum

Coorong Quays Case Study Presented by John Carter – Managing Director of Mill Hill Capital

28 th February 2018

1 COORONG QUAYS HINDMARSH ISLAND, SA

ß A high quality master planned residential, retirement and tourist community spanning over 300 hectares and anchored by the largest freshwater marina in the southern hemisphere

ß Development ramped up post 2001 upon opening of the Hindmarsh Island Bridge linking it to the mainland

ß Winner of several urban development, marina and tourism awards

ß Located at the mouth of the Murray River at the Coorong National Park c.100kms south east of Adelaide and near the towns of Goolwa and Victor Harbor (Storm Boy setting)

ß Alexandrina LGA is one of South Australia’s fastest growing regions with population growth of 1.8% per annum (2016 census)

ß Relatively high proportion of retirees and vacationers, both of which are growing faster than general residential

2 SITE PLAN

3 COORONG QUAYS - VISION

Coorong Quays should be the jewel in the crown of the Fleurieu Peninsula offering services and infrastructure that provide for a unique and exceptional place to live, work and play.

ß Coorong Quays has the makings of being a truly exceptional community offering a unique living environment to a broad cross-section of the community.

ß We believe these are the key steps to allowing Coorong Quays to reach its full potential:

ß Implementation of a new management team and staff

ß Stabilisation and reinvigoration of existing infrastructure and services

ß Better integration and co-operation with local community (eg. Alexandrina Council, local businesses and local community groups)

ß Maximising outcomes using existing infrastructure and approvals.

ß Coorong Quays will seek assistance from local stakeholders where mutually beneficial outcomes can be achieved.

4 MARINA COMPONENT

Description

ß Largest freshwater marina in the southern hemisphere with extensive canals servicing residential lots

ß Service and maintenance facilities including a dry dock, fuelling depot and c.1,500sqms of warehouses for repairs and maintenance

ß Travel lift and slipway facilities Opportunities ß Marina maintenance and repairs business leased. ß Grow occupancy in the marina through better Staff levels of this business are already increasing. service and pricing. ß 590 wet berths, ample dry berths and caravan ß Implement a capex program to rejuvenate the parking and secure undercover boat storage Marina. Currently replacing the fuel bowsers with ß Dedicated Marina Manager (Ben Kelsey) with new self-service pumps. extensive boating experience. ß Develop and foster boating and sailing in the community. Ben Kelsey already implemented a local school sailing program.

ß Assist local community events and groups through sponsorship and support from our staff and facilities. 5 RESIDENTIAL COMPONENT

Description Capital Value of Each Existing House & Land Lot (Valuer General SA) ß Canal estate with approvals for over 1,300 land $1,250,000 lots with over 880 sold to date and over 400 remaining to be developed – average of around 50 $1,050,000 lot sales per annum since bridge was opened in $850,000 2001 $650,000

ß Diverse range of existing houses priced from $450,000 around $300k to over $1 million and land lots priced from around $80k to $300k $250,000 $50,000 ß At development completion of each stage all land and canal infrastructure (except sewer) is handed over to the relevant authorities for them to maintain in future

ß We hold encumbrance contracts with residents which governs their use of the land

ß We hold a number of serviced lots and some houses/units that can be sold

6 RESIDENTIAL LAND SALES – HISTORIC INFORMATION (10yrs)

The below represents Land Sales on Hindmarsh Island over a 10 year period

Average Land Sales / Year: 47

Median Land Price 2017

Hindmarsh Island: $120,000

Alexandrina Council Area: $139,500

Source: RP Data 7 RESIDENTIAL HOUSE SALES – HISTORIC INFORMATION (10yrs)

The below represents House Sales on Hindmarsh Island over a 10 year period

Average Land Sales / Year: 49

Median House Price 2017

Hindmarsh Island: $432,500

Alexandrina Council Area: $365,000

Source: RP Data 8 RESIDENTIAL – CURRENT SUPPLY

The below represents the current supply of existing residential land lots or estimated lots on approved land. Location Residential Land Lots Coorong Quays 476 Rest of Hindmarsh Island* 686 TOTAL 1162

*Based on inferred information from data and estimates provided by Alexandrina Council 9 RESIDENTIAL COMPONENT

Opportunities

ß New management team who are currently focussed on improving service to residents.

ß Sale of completed lots and houses

ß Refurbishment of existing infrastructure and central facilities, improved road access and opening of latest canal to help lift land prices

ß Development and sale of new lots - next stage has 77 premium lots fronting a canal (already constructed) and 56 lots that can be sold at an affordable price point

ß JVs with local builders

ß Provision of additional services to residents; may include:

‹ Addition of second entrance onto Randell Rd to the East of the site. This is subject to Council and State Government approvals

‹ Review of the existing encumbrance to optimise the outcomes for residents

‹ Improved public amenities (walking tracks, bike paths, footpaths, outdoor gyms, BBQ facilities 10 etc) RETIREMENT VILLAGE COMPONENT

Description ß The Alexandrina Cove Lifestyle Village ß Gated community for over 55’s with high quality central facilities already constructed including club house and full-sized tennis court ß Approved for 116 units in total: ‹ 17 built ‹ 99 lots of future development pipeline

Opportunities

ß Re-position and re-energise current offering followed by the sale of existing completed units

ß Development of remaining lots to provide scale and vibrancy to the existing community

ß Potential to partner with an Aged Care provider (use available adjacent land) to develop a full service offering from independent retirement living to full care

11 TAVERN, RETAIL COMPONENT AND CARAVAN PARK

Description Opportunities ß Fully licenced tavern ß Tavern – now leased to local operators who ß c.1,000sqm of retail and services floorspace we expect to grow business (existing owner of Beach House Café – Encounter Bay). ß Freestanding house formerly used as a Operators currently intend to complete a doctor’s surgery refurbishment prior to the end of FY18. ß Approved Caravan park ß Marine Services – Marine maintenance and ß Approved Hotel and Convention Centre servicing leased to experienced and respected operator Goolwa Marine Services. ß Approved further expansion of retail and commercial offerings. ß Commercial – Currently actively seeking interest from operators to use existing space in the main office/retail building. Additional potential for a new service station

ß Tourism – Approvals for the caravan park and hotel and convention centre offer an exciting opportunity to investigate the viability of adding these services to the area. Coorong Quays would be willing to partner with operators where possible.

12 DISCLAIMER

This document has been prepared by Mill Hill Capital Pty Limited (ACN 110 720 226 ). It relates to the Mill Hill Capital Coorong Quays. We have prepared this document solely for general informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction or otherwise. You and your directors, officers, employees, agents and affiliates must hold this document and any oral information provided in connection with this document in strict confidence and may not communicate, reproduce, distribute or disclose it to any other person, or refer to it publicly, in whole or in part at any time except with our prior written consent. If you are not the intended recipient of this document, please delete and destroy all copies immediately.

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