A spike in office leasing, a significant tourism boost, outperformance in the residential market and an estimated $5.1 billion in sports related capital investment are just some of the forecast spinoffs from the 2032 Brisbane Olympics according to a new CBRE report.
The successful bid makes Brisbane the smallest city by population to host the summer games since Montreal in 1976.
But it will be a super-sized outcome for South-East Queensland according to CBRE’s Queensland Senior Managing Director Bruce Baker.
“The Olympics will transform South-East Queensland, with direct benefits from the event and infrastructure investment as well as secondary benefits from the global recognition that the region will receive,” Mr Baker said.
“With much of the sporting infrastructure already in place, and only six new venues needing to be constructed, we estimate that circa $5.1 billion of capital investment will be required to deliver key sporting projects such the Brisbane Live Arena above Roma Street Station and the Gabba upgrade. This compares to the total benefit to Queensland, which is expected to be $8.1 billion.”
Much of the capital investment will occur in the second half of this decade, averaging $800 million to $1.1 billion of investment per year from 2027-2030.
The report notes that one of the less measurable benefits of Brisbane being chosen to host the 2032 Olympics is global recognition.
This was evident the day after the announcement when “Brisbane” was in the top 20 Google searches across the US and there was a clear upward trend in Brisbane searches globally.
“The recognition benefits are likely to be larger for Brisbane than major global cities such as London and Tokyo, given tourists and the corporate sector are very familiar with those destinations, but far less aware of Brisbane,” Mr Baker said.
The tourism sector will be one of the key beneficiaries, with the Olympics providing a welcome panacea after the pandemic, which has significantly impacted Queensland tourism given international border closures and intermittent domestic border restrictions.
CBRE’s report highlights a clear opportunity to boost tourism numbers in the lead up to the games, as evidenced in Sydney after the 1993 Olympics announcement.
From 1994 through 1999, international arrivals to NSW were on average 23 per cent higher than expected trend levels, while in 2000 arrivals were 36 per cent higher. Assuming Queensland experiences a similar uplift from the Brisbane games, there could be an additional 4.3 million international arrivals from 2026 through to 2032, CBRE estimates.
Sufficient accommodation has been identified to meet demand, with 51,900 rooms available across Brisbane, the Sunshine and Gold Coast and major projects such as Queens Wharf in Brisbane providing an additional ~1,000 rooms.
The report separates the projected impact on the Brisbane office leasing market into two categories, the first being the direct benefit of increased capital investment and administrative functions to deliver the games and the second being a potential uplift in overall office demand.
CBRE’s Brisbane Managing Director Chris Butters said the State and Federal Government had already announced the establishment of a joint Olympic Infrastructure Agency to deliver key projects for the games.
“Given the $5.4 billion Cross River Rail project resulted in an office requirement of 8,000sqm, it’s feasible that the delivery of the Olympics could generate a requirement for 15,000sqm to 20,000sqm of office space,” Mr Butters said.
“The second consideration is the potential positive office demand from companies wanting to expand into Brisbane as a result of the city’s higher global profile. There is historic evidence of this occurring in Sydney, with the occupier market growing by 34% from the host city announcement to the games, compared to just 13 per cent for the rest of Australia.”
South-East Queensland has been one of the strongest performing residential markets in Australia over the past 18 months, underpinned by the relative affordability and lifestyle benefits of Brisbane, the Sunshine Coast and the Gold Coast.
If Sydney is any guide, the announcement of the Brisbane Olympics could possibly continue this outperformance, according to the CBRE report.
From the time of the September 1993 Sydney announcement up until the event, Sydney was the best performing capital city residential market in Australia, averaging 8.4 per cent house price growth per year.