Fijian property market offers opportunities

Over the past few years, Fiji property prices fell – particularly waterfront offerings – as the the global financial crisis (GFC) hit. 

Now, with an improving global economy and a rise in investor confidence, spending on “nice to haves” is back on the agenda, according to Philip Toogood.

“The GFC-related property price correction was not as significant in Fiji as it was in some other countries given that owners of many prime properties were able to ride out the storm and withdraw their properties from the market,” Mr Toogood explains in Bayleys’ upcoming edition of the company’s Waterfront magazine. “Today, though, there is pent-up buyer energy, and serious sellers are recognising the competitiveness of the leisure market – both within Fiji and between top leisure investment destinations.

“So we are seeing a rebound in sales activity as investment in a Pacific paradise is creeping back on to buyer shopping lists. Prices and returns are at very attractive levels, with the downward correction in values making Fijian coastal property very affordable in an international context.”

Mr Toogood says the domestic Fiji political situation after 2006 – and, in particular, the New Zealand and Australian governments’ response to this – put some potential offshore investors off the Fiji market.

“However, with a newly elected Fiji government in place and the formal opening of Parliament in October 2014, old friends are re-engaging and new friendships which had developed over the last eight years are strengthening,” Mr Toogood says. “The tourism market has recovered strongly, too, which has meant that the returns on income-producing assets such as managed resort apartments are at very good levels for international buyers on the back of lower purchase prices, and favourable exchange rates.

“Denarau apartments are back in demand from both offshore and domestic buyers, with yields of more than 10% not uncommon.” 

One US dollar now buys close to two Fijian dollars, meaning Fiji represents great value for money for Americans who are showing renewed interest in the Fiji market. There has also been a significant lift in Chinese investor enquiry and sales activity, particularly in the development sector. 

Other emerging markets identified by Mr Toogood include Papua New Guinea, while the Fijian expatriate markets of New Zealand, Australia, and Canada are buoyant in light of new political stability.

“With the Fijian dollar having depreciated against the Kiwi dollar from just over 70NZC in late to 2011 to its current level of 66NZc, Fiji is definitely back on the shopping list for more New Zealanders, with most preferring locations close to Nadi International Airport to streamline short holiday stays,” says Toogood.

Until 2014, there was a rapidly developing shortage of developed waterfront property in Fiji suitable for the leisure market. 

“There has been very little new development since 2005 and, as a result, we are now seeing a shortage of waterfront residential lots on Denarau. The number of Denarau apartments currently for sale is also at a very low level,” Mr Toogood says.

The most significant change in the Fiji property market over the past 12 months has been the much-anticipated start of a number of new project developments. 

Bayleys in Fiji has more than $F300,000,000 of new project sale stock under agency with marketing campaigns now under way or set to start in the final quarter of 2014 and in early 2015. 

These new projects include: 

• A 176-managed apartment development on Nadi’s Wailoaloa Beach;

• Dravula Heights – a small boutique freehold subdivision on the Coral Coast;

• The Moorings – a hotel, apartment and commercial development just outside Denarau Island;

• Nanuku – prime beachfront freehold subdivision in Pacific Harbour;

• Savasi Island Villas and sections close to the picturesque town of Savusavu;

• The Ramada Suites on the beach in Wailoaloa;

• The now well-developed Naisoso Island Resort, a complete island development accessed by bridge from the main island of Viti Levu, close to Nadi offering prime freehold waterfront and riverfront sections and house and land packages; and 

• Nasese Waters, a prime gated residential subdivision near the waterfront in central Suva.  

“As Denarau Island sells out, and demand increases for homes and residential sections across the islands of Fiji, these new developments will take up much of the growing demand,” Mr Toogood says. “Further significant projects are also proposed including the revitalisation of Momi – a spectacular resort, residential and golf course development just 30 minutes from Nadi International Airport; the Grand Fijian downtown Suva residential, commercial and hotel tower; The Pearl Apartment Resort in Pacific Harbour; Fantasy Island apartments – a 16-unit residential apartment development on Fantasy Island, Nadi; the Sovi Beach residential subdivision on The Coral Coast and Yaroyaro Resort Villas in the Yasawa Island Group.”  

Jody Robb writes for Bayleys Real Estate