Radical Facelift Planned for Abandoned Barrier Reef Resort

A “hidden treasure” of Central Queensland, Great Keppel Island is being prepared for development and investment after decades of neglect.

The Queensland government last week launched a major consultation and draft masterplan project for the island—known as Woppa by its First Nation’s custodians, the Woppaburra—to “facilitate development and investment aspirations”.

Earlier this year the leases of the previous owner, Sydney property group Tower Holdings, were revoked due to non-payment of lease fees and returned to the state government after a decade of what has been labelled “failed promises”.

After Tower’s original GKI Resort closed down in 2008, a substantial development was proposed, including a marina, beachfront hotel, golf course, and villas and apartments.

It was approved by all levels of government in 2013 but quickly fell by the wayside. Plans in subsequent years, such as developer Terry Agnew’s attempt to push forward a casino development and Gina Rinehart’s efforts to acquire the island for $50 million, also failed.

The Queensland government is now attempting to renew investor interest in the island, which has about 970ha of state-controlled land available to be allocated.

[TAG0]
▲ The Queensland government has supported the redevelopment of resorts such as Hamilton Island with a $25-million Rejuvenation Program.

John Rolfe is a professor of Regional Economic Development in the School of Business and Law at Central Queensland University in Rockhampton.

“This masterplan is almost at the opposite end of what we’ve had for the past 10 to 15 years,” he says.

“All these previous proposals promised to build a mega-resort and establish lots of housing on the island, effectively trying to create another Hamilton Island where you have residential as well as a resort. I think this version is much more realistic and likely to be more widely supported.”

But locals such as Lucas Ouston, general manager of residential developer Keppel Developments, say any incoming developer would have to earn the trust of the community.

“Given the number of false starts the community has seen, the cynical among the community question whether this is just another political stunt in the lead-up to the next state election,” Ouston says.

“Rather than felling more trees to produce another report, of which there have been many during the term of the current state government, I’m sure the community would rather see boots on the ground working on the project.”

Clearly, the opportunity for Great Keppel is there but, as of yet, no developer has dared to risk it.

New approach

As part of the masterplan, the Queensland government has prioritised low-scale, eco-friendly and sustainable development on the island after consultation with stakeholders, including elders of the Woppaburra people.

As a result, the scale and purpose looks a lot better, says Prof Rolfe.

“It will cater to the regional market, so there’s no reliance on attracting international visitors, which other plans centred on,” he says.

“Supporting local businesses to develop in the area is a good idea and it doesn’t run afoul of politics, so if the government provides services like utilities, it won’t benefit just one particular mega corporation.”

Unlike previous plans, which have focused on the ultra-rich, the masterplan promotes equitable access to the island, with a new jetty potentially on the northern end and at the centre of Fishermans and Putney beaches.

Alhough the island has an airstrip, it is only capable of handling light aircraft and is not in use.

[TAG1]
▲ The Capricorn region had 1.2 million domestic visitors who spent $915 million in the year ending March, 2023.

To help attract investor interest in the GKI Resort, the Queensland government committed $25 million for common-user infrastructure for GKI under the 2017 Growing Tourism, Growing Tourism Jobs election commitment. This funding has been supplemented by a further $5-million through the Building Our Regions program.

After general community consultation, the formal adoption of the masterplan is expected in October.

Business organisation Capricorn Enterprise, as well as a number of Great Keppel Island accommodation and tour operators, were involved in the consultations, chief executive Mary Carroll says.

“[Great Keppel Island] deserves a variety of accommodation styles to suit all budgets and attract additional tourism experiences to those already on offer, so that Great Keppel Island can once again be the Queensland island of choice,” she says.

“Capricorn Enterprise continues to support our tourism operator requests; that a jetty and barge ramp and new sewerage treatment plant is constructed as a priority, as well as the urgent upgrade of the Shelving and Monkey beach trails.”

The masterplan improves accessibility and the state of walking tracks, and suggests potential developments, including a resort at Fishermans Beach, Woppa tourist park and village centre, a forest eco-retreat, a homestead eco-precinct, and another at Clam Bay.

[TAG2]
▲ The Livingstone Shire, which includes Yeppoon, had one of the biggest growths in property values in the state, according to CoreLogic.

However, there are major challenges to the site, Keppel Developments’ Lucas Ouston says.

“The cost of said redevelopment has, we believe, been found to not be commercially viable by those parties previously involved,” he says.

“Without a serious investment in the required infrastructure required—jetty, airstrip and sewerage—to progress redevelopment, any new players are likely to come to a similar conclusion to Hancock [Gina Rinehart’s development company].

“Smaller leases may attract new players interested in developing part of the overall redevelopment but that doesn’t address the major infrastructure investment required to make the overall redevelopment viable.”

The growth of Capricorn Coast

The Southern Great Barrier Reef region has faced a challenging few decades, with high operating costs, seasonal visitation patterns, major weather events and strong competition for the tourist dollar, not to mention the pandemic.

This led to the closure of 12 of the 27 island resorts in the Great Barrier Reef, including the main resort on Great Keppel in 2008.

Prof Rolfe said that although Australians were more likely to travel domestically in the immediate aftermath of the pandemic, there had been a return to overseas travel.

This could leave more regional places, and even major tourism destinations such as Cairns, struggling in the forseeable future.

“People are going overseas again, so even places such as the Whitsundays have had a quiet year this year. Cairns is also suffering, because what Cairns is missing is new attractions, so serious discussions need to be had about whether it’s worthwhile investing in new attractions.”

[TAG3]
▲ The median house price in the Yeppoon region jumped 7.3 per cent, in the 12 months to April, to $632,830.

While it may not be attracting cashed-up international visitors anytime soon, the wider Capricorn Coast region is itself increasing in affluence, with 41 per cent of households having an average income of $104,000, an increase of 14 per cent from 2011.

“Yeppoon and the Livingstone region has done a good job of revamping the area, the lagoon and making it friendly for tourists,” Rolfe says.

“We will see a continued population growth on that coast and having Great Keppel will help. If you have a well-functioning island close by with a lot of services, it adds to the appeal of the Capricorn Coast, and would be a huge asset.

“Importantly, it will hold recreation and tourism dollars within the region.”

Carroll said that with elections coming up in 2024, the state government had a real opportunity to commit additional funding to the masterplan.

“Specific timelines and detail surrounding land tenure, and at least six bodies of technical work listed in the report as being required, need to be fast-tracked to ensure this plan has immediate effect and attracts the attention of appropriate investors,” she says.

Ouston said that the Livingstone Shire local government area was ranked third in Queensland behind Ipswich and Moreton Bay for growth forecasts to 2046, leading to demand skyrocketing for its Shoals and Sea Haven estates.

“This growth, which we are already seeing based on the demand in our beachside estates, will no doubt result in a greater level of investment in the region and, with that, further development.

“The redevelopment of Great Keppel would deliver a first-class tourist destination for the southern Great Barrier Reef area, if done properly.

“That would no doubt enhance the tourism industry across the region and provide a potential further boost to the local economy.

“All of these things add to the liveability of the region and make living on the Capricorn Coast increasingly more attractive.”

Article source: Queensland Property Investor