Large scale development and investment in the Australian property market is on a substantial growth curve. This growth is being supported by a dramatic rise in foreign investment into the Australian commercial real estate market. The prolific rise in development activity is reflected in a number of prominent, city-shaping commercial and residential apartment property development projects. And a distinguishing feature of this wave of projects compared to others in recent history is the quantity and scale of projects that are being financed by property developers or funds based in Asia. At the same time, many of these projects are being developed with a mindfulness of what Asian investors, consumers and visitors want.
Sydney and Melbourne have well-established profiles as prime investment opportunities. And while the clear majority of this current wave of property development in value and number terms is found in these two Australian cities, there are many examples of major projects underway throughout all Australia’s capitals and leading regions. Sydney’s Barangaroo, is a site totaling 22 hectares which is divided into three major development areas: Headland Park, Central Barangaroo and Barangaroo South. Lend Lease will develop the South into a major new mixed-use commercial, tourism, residential and retail and dining precinct. Central Barangaroo will become the cultural heart and civic focal point for recreation, relaxation, events, festivals, entertainment and leisure activities along the waterfront parkland. The Headlands provides six hectares of naturalistic parkland which is now open to the public. The site is expected to be completed over the next 5-7 years.
Another major project in Sydney is Circular Quay. This prime location will receive significant re-invigoration through the $1 billion, 43-storey Quay Quarter developments proposed for AMP’s 50 Bridge Street site. The development will feature a landmark innovative architectural form, creating a mixed-use, integrated precinct connecting Sydney Harbour to the CBD. Balancing economic and commercial priorities, with that of a 24hr contemporary social and cultural development, the Quay Quarter building strengthens Sydney’s role in the broader Asia-Pacific region, boosting local tourism and the economy.
Similar to Sydney, Melbourne has a number of major developments responding to the increasing demand for commercial, residential and mixed-use land uses. Fishermans Bend, totaling a planned area of 455 hectares, and an investment value of $20 billion, presents a significant opportunity to support and encourage commercial, business, retail and residential developments. The precinct currently has approval for seven high rise towers. An estimated 80,000 new residents will be accommodated in the area by 2030. Melbourne City is also planning for significant redevelopment and revitalisation. Another dynamic development, only 6km from the CBD and valued at $650 million, is 40 Hall Street and 34-36 Margaret Street, Moonee Ponds. The multistage development will deliver 1,200 apartments and 13,400sqm of retail and office space. Acquired by Caydon, the Moonee Ponds site demonstrates market confidence in the development of inner city neighbourhoods where people can live, work and socialise.
Brisbane’s Queen’s Wharf development, by the Echo Entertainment, will become an iconic tourist attraction, which will provide integrated and extensive public spaces, and feature five new hotel towers including a six-star Ritz-Carlton and five-star Rosewood and Dorsett Hotel. Brisbane’s economy will also receive an injection of 3,000 construction industry jobs and 8,000+ ongoing jobs in hospitality, gaming and administration. Meanwhile, Singaporean property developer, World Class Land, received development approval for a 91-storey residential tower in Albert Street Brisbane that will be the city’s equal tallest building. The so-called “vertical village” on the corner of Margaret Street will include 732 apartments and will be the third residential tower in Brisbane to reach the legal height limit of 274 metres, following Skytower in Margaret Street and Taiwanese-based Shayher Group’s tower in George Street, both of which are under construction.
Also in Queensland, in the Gold Coast there is approximately $6 billion in new developments planned or underway. The Gold Coast’s property market and broader economy has been turbo-charged by significant volumes of foreign investment. Two of the major projects occurring along the path of new light rail infrastructure include the Jupiters Casino upgrade and the Jewel development. The Jewel development in Broadbeach will enhance the Gold Coast’s reputation as an international destination. Wang Jianlin, Chairman of Wanda Group is driving the $1 billion project. Expected to be completed by 2018, the three towers mixed-use development will deliver 130 metres of beach frontage for 500 apartments and 171 hotel rooms, and provide a range of luxury retail precincts. Both developments represent a powerful commitment to future prosperity and mark the next phase of the Gold Coast’s growth. Earlier in May, the Star Entertainment Group launched a community information program as an initial component in a substantial revamp of its Jupiters Casino on the Gold Coast. The concept includes a proposal for a new 200 metre hotel and apartment tower, construction of which could commence in 2017. This would boost the current $345 million redevelopment at Jupiters to a potential mega-investment worth up to $850 million to include options that would create a truly globally-competitive integrated resort. The master plan concept provides for future development options valued into the billions of dollars with perhaps five hotel and/or apartment buildings, a world class recreational deck with water features, tropical gardens, pools and spa, and new entertainment facilities.
Australia’s major cities continue to represent an exciting and logical investment destinations. While the projects outline above may seem futuristic in scale and reach they are but a sign of the city changing developments which will redefine how the world comprehends our country.
MacroPlan provides strategic property advice to the development industry based on economic research, forecasting and a comprehensive understanding of the local planning process. We are both economists and planners. Many development projects require integrated economics and planning solutions, and our strength in both disciplines means we can guide proponents through what can be a complex process. Contact Mark Courtney today to discuss how we can help to define and gain approval for your development projects.
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