MCU14/0106 & OPW15/0001 Appendix B - Retail Needs Response

As indicated on page 80 of the DA report, retail spending levels are based on estimates derived from
Marketinfo, a widely used source of retail spending data in Australia. The Marketinfo estimates are
calibrated to national data published by the ABS and are ‘reality checked’ by Urbis, as well as a group of
national retailers and research departments associated with the managers of Australia’s main REITs,
prior to each public release by MDS.

The drivers of spending levels are wide and varied, and although income is the main factor, there are
many other variables as well. In areas such as the Noosa trade area, where average incomes are lower
than the state average due to a lower proportion of very high income earners, and there is a high
retirement population and relatively high disposable income due to low mortgages, it is possible that
residents direct a higher proportion of their income to retail needs. This is shown in Table 1.3 below,
where there is a low proportion of mortgaged home ownership, as well as low labour force presentation
and a high proportion of residents aged over 55 across the trade area.

2014 Retail Spending Per Capita & 2011 Demographic Drivers

 

 

 

NOOSA CIVIC TRADE AREA TABLE 1.3
2014 Retail % Home
Spending Per 2011 Income Ownership (no Labour Force
Capita Per Capita mortgage) Participation % Aged over 55
Var. Var. Var. Var. Var.
Total from from from from from
Retail Qld. Qld. Qld. Qld. Qld.
Primary 13,340 +3% 38,256 -14% 38%  +8% 56% -11%
Secondary: -
North East 14,387| +11% 43,907 -1% 34% +4% 64% -3% 33% | +8%
South East 13,334 +3% 41,431 -7% 28% -1% 66% -1% 26%  +2%
South 13,379 +3% 40,221 -9% 35% — +6% 64% -3% 28%  +3%
North West 12.814 1Y 35,529 -20% 39%  +9% 59% -8Y 34% 49%
Total Secondary 13,393 +3% 39,963 -10% 34%  +4% 63% 4% 30% +5%
Main Trade Area «13,378 -+3% 39,508 -11% 35% 45% 61% -6% 32%|  +8%

Queensland 13,002 - 44,354 - 30% - 67% ee 25% -

1.3 GROWTH RATE

Information request:

‘The Retail Needs Assessment includes allowance for real growth in per capita expenditure
in the order of 1.8% per annum, which is considered high’.

Response:
As indicated in the DA report:

Real per capita spending growth ... is forecast to average around 1.8 % per annum to
2031. The average rate of ‘real’ growth over the past 20 years in Australia has been 2.6%
per annum but we expect more subdued growth going forward. Given this relatively
conservative forecast by historic standards the probability of a higher real growth rate is
arguably greater than the downside.

In light of evidence regarding the historic long term trend, and our analysis of the drivers of retail spending
growth over time, it is our firm view that an overall real growth rate of 1.8% is appropriate. Please note,
however, that this is an average rate across all retail categories.

URBIS .
NOOSA RESPONSE REPORT - RETAIL ECONOMICS JUNE 2015 V2 TRADE-AREA AND EXPENDITURE 5