_ Ten property hotspots across the globe investors should take note of in 2019
For most property investors, having their ears to ground when it comes identifying the neighbourhoods on the rise is paramount to an intelligent acquisition strategy that pays dividends.
But when on the hunt for the elusive golden goose - future yield, how can we really be sure that an up-and-coming area will reach maturity?
Based on key criteria to include regeneration, improved transport links, emerging tech hubs and buoyant career prospects Knight Frank's global team of local insiders give a unique perspective on hotspots around the world savvy investors should sit up and take note of.
Asia Pacific
Wynyard Quarter, Auckland
Ian Little, Bayleys Realty Group
What's so great about it and how has it changed?
Home of the 2021 America’s Cup, Auckland's Wynyard Quarter is changing – fast. Over the past 10 years this waterfront precinct has emerged as a major hub for national and international corporates including Fonterra, Datacom, Microsoft and the ASB Bank as well as for the city’s innovation and co-working scene.
What's new?
As the local business community has grown, so too has the range of entertainment and hospitality options on offer. In 2016, the NZ$36 million ASB theatre – the new home of the Auckland Theatre company – opened immediately adjacent to the waterfront restaurant, bar and café strip.
Who does it attract?
With all this activity comes a growing residential population and a sweep of new residential development projects commanding some of the highest prices in the city. Plans have recently been announced for a 435-apartment and retail complex.
St Kilda Road Precinct, Melbourne
Sarah Harding, Knight Frank Australia
What's so great about it and how has it changed?
Leaving Melbourne’s business district and walking down St Kilda Road towards the beach, you could be forgiven for thinking you were on a wide tree-lined boulevard in some European city.
At the northern end, multiple tram stops provide access to attractions including the Royal Botanic Gardens, the National Gallery of Victoria and the Arts Centre, while to the south Fawkner Park, The Alfred Hospital, Albert Park Lake and some of Melbourne’s top private schools are in walking distance.
What's new?
A thriving co-working scene is fuelled by popular cafés and restaurants such as seafood stalwart Bacash and hip newcomer Matilda 159. Several secondary office buildings are earmarked for high-end residential conversion, encapsulating the area’s live/work ethos.
Who does it attract?
The precinct has a well-established office market, popular with advertising agencies and tech companies who prefer to be outside the traditional CBD. Expect to pay around A$1.8 million for a prestigious St Kilda Road apartment. Over the next 15+ years the St Kilda Road South Precinct will evolve as a vibrant and diverse cluster of neighbourhoods with a growing residential community based around St Kilda Road, Wellington Street and Carlisle Street.
Hung Hom, Hong Kong
David Ji, Knight Frank Greater China
What's so great about it and how has it changed?
Once home to the old Hong Kong Whampoa Dockyard, the neighbourhood of Hung Hom has traditionally been home to a mix of blue- and white-collar workers.
Boasting a distinct identity and strong sense of community, local landmarks include Hong Kong’s second largest indoor arena, the Hong Kong Coliseum and the Senso Italiano gallery. Hung Hom is also the place to go for some of the city’s best and most authentic southern Chinese food.
What's new?
Now, with the advent of a new metro station, as part of the ongoing HK$90 billion Shatin to Central Link project which is scheduled to open in 2021, the area – hitherto connected to Hong Kong Island only by ferry or road – will be able to add excellent transport connections to its list of attractions.
The impact is already starting to be felt in the property market, with prices rising steadily. Most two and three bedroom flats in the area are priced between HK$180,000 to HK$200,000 per sq m.
America
Pasadena, Los Angeles
Tim Durkovic, Douglas Elliman
What's so great about it and how has it changed?
Home to the Rose Bowl, NASA’s Jet Propulsion Laboratory and the California Institute of Technology, Pasadena offers an attractive combination of relative value compared with neighbouring communities in Beverly Hills and West Hollywood, and the desirable lifestyle and privacy that Los Angeles residents seek.
Who does it attract?
Home to a population of around 145,000, the neighbourhood is easily accessible, with a light rail line that puts it within 15-20 minutes of Downtown Los Angeles. The picturesque Spanish Colonial Revival style buildings found in Old Pasadena appeal to upmarket shoppers and the area is widely recognised as one of Southern California’s most popular retail and entertainment destinations.
With the San Gabriel Mountains as a backdrop, Pasadena offers a plethora of home types, from craftsman-style properties to mid-century post-and-beam dwellings as well as the famed "La Miniatura", by Frank Lloyd Wright. The average property value is approximately US$825,000, but it remains a highly accessible market with listings starting at US$450,000 and rising to US$28 million.
The Seaport District, Boston
George Jedlin, Douglas Elliman
What's so great about it and how has it changed?
Successive waves of development, beginning in the late 1990s, have transformed this historical part of South Boston. The railyards and warehouses of the city’s former shipping port have been replaced by industrial-chic conversions and state-of-the-art glass skyscrapers.
What's new?
The District’s 11,000 residents share the waterfront with a marina and attractions including the Institute of Contemporary Art, and Icon, a state-of-the-art cinema featuring far-reaching views of the city’s skyline. They are also spoiled for choice when it comes to restaurants, from local oysters and craft ale at Row 34 to tacos and tequila at Lolita Cocina.
Who does it attract?
Located within a 10-minute walk of Boston’s Financial District, the Seaport District is popular with young professionals yet also appeals to older residents seeking a city base for part of the year.
Buyers originate from elsewhere in Massachusetts, the East Coast of the US and even further afield, from Europe. A typical two-bedroom contemporary apartment starts at US$1,800 per sq ft with the most desirable projects with the best views commanding close to US$3,000 per sq ft.T
Delray Beach, Florida
Nick Malinosky, Douglas Elliman
What's so great about it and how has it changed?
Tucked neatly between Palm Beach and Fort Lauderdale, Delray Beach offers relative value and a more relaxed feel than its coastal neighbours. Atlantic Avenue and A1A Ocean Drive are the town’s prime destinations, with beachfront plots significantly deeper than elsewhere along the coast.
What's new?
The new US$1 billion Brightline train has significantly reduced journey times along the coast, while the town’s Pineapple Grove Arts District, Morikami Museum and Cornell Arts Museum attracts a creative crowd which is catered for by an increasingly hip restaurant scene.
Who does it attract?
Key buyer groups include New Yorkers, Canadians and Europeans who find the low tax rates, climate and accessibility appealing. Both Palm Beach and Fort Lauderdale airports are located within less than a 25-minute drive.
Housing in Delray Beach consists of luxury detached family homes circa 3,500 sq ft in size with a private garden and pool, which start at US$3.5 million and townhouses of approximately 3,000 sq ft starting at around US$2 million.
Europe
Lucca, Italy
Amy Redfern-Woods, Knight Frank International
What's so great about it and how has it changed?
Lucca, one of Tuscany’s most scenic cities, dates back to the Roman Empire. Cobbled streets, piazzas, art galleries, museums and over 100 churches are all set within the Renaissance walls that encircle the historic city centre.
Located within an hour’s drive of Pisa and Florence airports, and only a 30-minute drive from the Mediterranean coast, Lucca offers a more peaceful alternative to some of Italy’s more tourist-led markets.
What's new?
The city boasts a lavish selection of upmarket restaurants – for something new, try Il Punto or for a more traditional taste, Buca di Sant’Antonio, serving local cuisine since 1782.
Who does it attract?
Home to a mix of wealthy locals and musicians, the city offers a good quality of life alongside a strong sense of community with an array of events and festivals including the Lucca Summer Music Festival, which also appeal to overseas buyers.
A three-bedroom, recently restored apartment with lift averages around €800,000, while a larger four to five-bedroom apartment with garden and lift can be acquired for around €1.5 million.
Friedrichshain, Berlin
Claire Locke, Knight Frank International
What's so great about it and how has it changed?
Friedrichshain may now offer a plethora of entertainment, shopping and lifestyle options, but it has not always been this way. The area was once part of communist East Berlin and remains packed with relics from the German Democratic Republic era, such as the Soviet-era buildings that line the monumental socialist boulevard of Karl-Marx-Allee and the longest surviving stretch of the Berlin Wall.
What's new?
Now famed for its art scene, Friedrichshain is home to the East Side Gallery, the longest open-air gallery in the world, as well as Urban Spree, an independent contemporary art space that features urban artists and champions a grassroots approach. This willingness to embrace the city’s history, while adding a unique futuristic edge, has attracted many large corporations including Coca-Cola, BASF, Universal Music and Mercedes.
Who does it attract?
With the above businesses come jobs – some 30,000 at the last count – and with jobs comes growing demand for property. The 2018 report from Knight Frank’s German partner, international property consultants Ziegert, lists Freidrichshain-Kreuzberg as one of its top three districts in Berlin. A typical two-bedroom apartment starts at €430,000.
Chelsea, London
Liam Bailey, Knight Frank
What's so great about it and how has it changed?
Few London neighbourhoods have a global brand as strong as Chelsea’s, and to name it as an up-and-coming area might on the face of it seem slightly odd. However, this is the perfect example of an area which has been underperforming and which is now ripe for reassessment.
Prices here have fallen 19% since late 2014, compared with a 10% fall across the wider prime London market. While new-build property achieves a premium, established property trades at between £1,200 and £1,800 per sq ft; yet with many sub-£1,000 per sq ft examples Chelsea has become less expensive than many much less glamorous and less central locations.
Yes, the area still lacks the connectivity of other prime neighbourhoods. However, with easy access to the river, unrivalled shopping on the King's Road and Fulham Road and some of London’s best schooling - including the London Oratory School and the Lycée Charles de Gaulle - and the promise (or maybe hope) of a station on the future Crossrail 2 underground railway, it is all set for rediscovery.
11th arrondissement, Paris
Roddy Aris, Knight Frank International
What's so great about it and how has it changed?
Located on the edge of the historic Marais district, the 11th arrondissement is a young, vibrant neighbourhood. Foodies and fashionistas flock to the chic eateries and boutiques in and around the Place de la République and Place de la Nation – try Septime for a fresh twist on the bistrot tradition, or Le Clown Bar, in the old Cirque d’Hiver, for a taste of the city’s lively natural wine scene.
Properties range from large Haussmann apartments on wide boulevards such as Avenue Voltaire to lofts and ateliers in the more commercial districts.
Who does it attract?
Home to around 150,000 residents, the 11th is benefitting from the ripple effect emanating from the bohemian buyers that have already helped push up values in the neighbouring 10th arrondissement. Young, single professionals gravitate towards the Oberkampf district to the north, while families veer further eastwards to take advantage of the parks and squares.
A three-bedroom apartment on one of the main boulevards starts at €850,000, the same property in the 4th arrondissement would be closer to €1.2 million.
This article first appeared in The Wealth Report 2019. View the full list of 'next neighbourhoods' identified by Knight Frank's global network of property experts.