The $368-billion defence project to build and operate nuclear-powered submarines in Australia over the next 30 years will ignite a building boom but experts warn there are still major housing and workforce challenges to overcome.  One of the most immediate impacts will be felt in Western Australia’s Rockingham, 47km south of Perth, where $8 billion in upgrades to HMAS Stirling, Australia’s largest naval base, are already under way. These upgrades, driven by the AUKUS agreement—a trilateral security pact between Australia, the UK and the US to bolster defence capabilities in the Indo-Pacific—are fuelling major development opportunities but also exposing significant challenges in housing supply and workforce capacity. The Rockingham Strategic Centre Precinct Structure Plan, currently under review by the Western Australian Planning Commission, outlines a vision to transform 550ha into a mixed-use urban centre with flexible built-form guidelines. The plan aims to address the needs of the region’s rapidly growing population. The Property Council of Australia says Rockingham is a focal point for growth. The council’s WA executive director Nicola Brischetto says the city and its surrounding suburbs are “poised for strong residential and industrial growth through AUKUS and our emerging defence industry”. ▲ Rockingham will expand dramatically thanks to the AUKUS treaty. Pictured top: A US Navy submarine prepares to dock at HMAS Stirling. Brischetto says that although housing the growing workforce in the area will be “a major challenge”, the Property Council is working with state to ensure “the right policy and planning frameworks” are in place to support development. “The WA property industry sees great investment and employment opportunities in the area, especially in the industrial land space,” Brischetto told The Urban Developer . “Effective planning and the right government investment in supporting infrastructure will be crucial in making the most of this opportunity.” While the state’s modernisation of planning rules and Rockingham’s well-serviced train line provide a strong foundation for boosting housing supply, Brischetto says the construction workforce is insufficient to meet demand. “For us to build our fair share of the Federal Government’s National Housing Accord 1.2-million new homes target, we’ll need to construct 130,000 of them by mid-2029—or 26,000 each year,” she says. “Last financial year, only 17,700 homes were built across the state. We need to quickly expand our residential construction workforce to future-proof WA’s economy.” Defence drives demand Research by CBRE projects that AUKUS-related developments at HMAS Stirling, and the Osborne Shipyard in Adelaide, will require more than a million square metres of logistics and retail space. ▲ HMAS Stirling near Rockingham from the air. It also forecasts demand for 24,500 new apartments across both locations to accommodate workforce growth in the next six years. “Manufacturing of this type is very logistics intensive, creating a number of large-scale opportunities to redevelop real estate to support the infrastructure associated with AUKUS,” CBRE Pacific head of research Sameer Chopra says. “Ideally, new apartment construction is within easy commute of these emerging large-scale employment destinations. “This should also be supportive of residential values in close proximity suburbs.” Colliers’ WA real estate report underscores the region’s rapid growth, with WA’s population increasing by 3.1 per cent in the year to March 2024, the most rapid in Australia. This growth is attracting interstate and overseas migrants, boosting demand for industrial and logistics space. Colliers industrial and logistics director Sam Hammond says sectors such as transport, logistics, mining and manufacturing remained highly active. “The outlook for the industrial and logistics sector in WA continues to be robust, with leasing enquiries shifting from larger warehouse spaces to smaller warehouses, workshops and hardstand,” Hammond says. ▲ Royal Australian Navy Collins class submarines off the coast of Rockingham. While demand for large warehouses had slowed, Hammond says smaller facilities are driving leasing activity. “Looking ahead to 2025, an additional 220,892sq m is expected to be completed, primarily driven by supply in the East precinct [about 13km east of Perth CBD],” he says. “This may put upward pressure in that submarket.” Rockingham’s development opportunities, bolstered by the AUKUS agreement, highlight the region’s growing importance in WA’s industrial and residential landscape. “Strong population growth, significant infrastructure investment in the State, economic diversification and growing partnerships are just some of the many promising factors that will drive the economic growth of WA in the coming years,” Colliers research manager Yashwini Halai says. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.
