Gold Coast seeks new wave of success

By GREG ANSLEY

GOLD COAST - Even in the relative cool of a Queensland winter, the beach is alive with suntanned bodies and surfers, boards under their arms, heading for the waves.

In Surfers Paradise, developer Jim Raptis stands with jumper tied lightly around his neck, enthusing over the Mediterranean curves and pastels of his new $A400 million Chevron Renaissance shopping and restaurant precinct that has displaced a tawdry strip of T-shirt hawkers.

On one side of the Broadwater, Saheil Abedian guides visitors through a Versace condominium; on the other, the first units in the yet-to-be-built 15-level Deepwater Point apartment complex are selling well.

It looks like business as usual in this brashly confident strip of prime real estate.

But beneath the vibrancy there is is strengthening conviction that the Gold Coast cannot survive purely on sea and sun: the two elements, and the resorts that go with them, are mushrooming around the globe in a disturbingly competitive rash.

The Asian meltdown hammered this home with a cudgel. For three years, occupancy rates at Gold Coast hotels were in free-fall - tumbling from almost 80 per cent to 63 per cent - with room rates spiralling down 17 per cent.

There's no doubt the Gold Coast has had a difficult few years, according to Mirvac Queensland chief executive officer, Chris Freeman.

Apart from Mr Abedian's Palazzo Versace, no new hotels are rising into the skyline and, says tourism and property analyst Alan Midwood, none are likely to appear for several years.

The boom in daily serviced apartments has also cooled significantly and although about $A4.6 billion in real estate developments are under way, the Asian collapse and a 40-year series of booms and busts has forced the Gold Coast to confront its reason for existence in the 21st century.

Other Australian cities have faced the same realisation: Melbourne, when tariff cuts plunged the manufacturing capital into deep recession and head offices began moving north; and Canberra, pole-axed by the hewing of the federal public service.

None of this escaped attention on the Gold Coast.

Even though the city had never reached a similar nadir, the dangers were clear.

Historically the Gold Coast economy has had two pillars - construction and tourism. Mr Midwood says the Coast is not trying to get away from them, but wants to add a new pillar: innovation.

According to Jeff McDermid, chairman of Gold Coast Innovation City, this did not come easy. In the past the Coast was plagued by vested interests who saw change as a threat, but new economic directions have been embraced across the board.

The soul-searching extended out of the chamber of the Gold Coast City Council - formed by the merger of its predecessors into Australias second largest council, with a $A400 million-a-year budget - to an energetic private sector and a growing academic base centred on three universities.

The city's population - an estimated 425,000 - grew last year by 3.4 per cent, 12,800 new residents, adding both to potential and already-emerging pressures on employment, transport and other services.

Council economic development director Greg Young, says there is a need to broaden and deepen the economy.

The answer is technology, pulling together an already considerable knowledge and high-tech base and attracting more under the label of Innovation City, a sort of silicon-on-sea.

Innovation is also being backed by a revamp of Surfers Paradise and the Gold Coast road system, new industrial clusters - among them the $A30 million Coomera Marine precinct - and a drive to tap further into the booming global conventions market with a new $A202 million convention centre joined to Jupiter's Casino.

The total value of big public and private projects under way now tops $A7.5 billion.

Not since the advent of the first international hotels and the opening up of the Japanese tourist market has there been such significant change, Mr Midwood says.

Though the innovation strategy will still rely heavily on the comparative advantages of the sunbelt, competitive advantage is rolling down from Brisbane through the State Government's Pacific Innovation Corridor, already pulling in some heavy-hitters.

The PowerTel consortium, majority-owned by US telecommunications giant Williams, in collaboration with Boeing Australia, is laying a 140km-high bandwidth fibre-optic network that will feed into a key plank of the Gold Coast strategy: Varsity Lakes.

Varsity Lakes is a $A1 billion project by commercial developer Delfin around the private Bond University, blending 2500 homes, championship golf course and waterways with a technology park that already houses extensions of AAPT, IBM, Compaq and the like.

Economic planners are also pushing to attract emerging technologies with incubators designed to cosset new ideas, through development and start-up, into production.

Among them will be inQbator, given $A9.5 million by the Federal Government to invest and nurture start-up ventures on the Gold Coast, providing - at least in theory - a direct progression from university to research and development to new industry.

Griffiths University's Gold Coast campus is setting up a biotechnology incubator, and another for advanced manufacturing has been proposed for the northern end of the Coast.

"We want the future Bill Gates of the world to emerge here, stay here and create enormous new wealth," Mr Young says.

Boosted by greenfields incentives, there has already been significant investment in the knowledge economy, with at least 185 companies involved in IT consulting, web and software development, e-commerce applications, internet access and hardware manufacture.

The state Government has also provided $A13 million in seed money to 20 Gold Coast high-tech companies it believes have the potential to generate $A350 million in sales in the next three years.

To the north, a rapid new transport system is eating its way down from Brisbane with the $A750 million Pacific motorway; to the east, and traffic is being pulled out of Surfers Paradise in favour of palm-lined redevelopment.

"This is no longer a burg," says Mr McDermid. "It's a metropolis in its own right."

* Greg Ansley visited the Gold Coast courtesy of the Gold Coast Development Association.