Development-Approved Sites Worth $200m Draw Buyers

The ground is forever shifting under the feet of property developers.

Never more so than right now, according to development site marketing specialist and 64 Projects founder James Donnelly.

“The market has changed significantly,” he says.

“But while the challenges facing the sector are making headlines daily and well-documented, astute developers, builders and investors are clearly focused on both the selling and buying opportunities.”

Donnelly says 64 Projects currently has more than $200 million worth of development-approved sites in Queensland and NSW on its sales book—attracting strong interest from a database of 1500 big and small property players—and it is growing by two to three new listings a week.

“With soaring building costs, wet weather, shortage of labour, rising inflation and interest rates, the construction industry is in turmoil and the perfect storm is right now,” he says.

“But the pillars of the market are still pretty solid in that we have a serious lack of housing across the country and rents are rising more than they’ve ever done.

“And so there’s no shortage of exit strategies if developments are built but therein lies the catch, of course, as well as the opportunity.

“The weakness in the market is in projects that potentially won’t be able to be built and the opportunity is for people with balance sheets that can get these things up … so, yeah, build it and they will come.

“But, certainly, the alarm bells are now ringing and the key hole to exit some of these development sites is going to get very small in the next six months—so, time is of the essence.

“If you’re thinking you can’t hold your property with your finance team in place, then maybe you’re going to need to make a move pretty much now to exit the development that you were going to do and make way for someone else to move on with it.

“The most important thing to remember, however, is the development approvals over these sites are all very recent and they often hold for two and three more years. So, they have significant upside and value … all the hard work is done and they are ready to go.”

Donnelly says the ability to match sellers with buyers is the key element that 64 Projects brings to the table and integral to its proven ability to achieve successful outcomes under the prevailing market conditions.

“Having been through the GFC we understand and have got a really deep knowledge of what to do in these markets.

“Also, I’m a massive believer in putting willing sellers together with willing buyers as they will normally do a deal in the best interests of each other.”

Although established only two years ago, Queensland-based 64 Projects is the culmination of Donnelly’s more than three decades of experience working across all facets of the property industry and the extensive sales expertise of his colleague, Ranal Charan.

It was born out of a largely untapped niche and increasing demand for a specialist “shop window” for development-approved sites of all sizes.

“Our entire business model is a really clean exit strategy for developers at no extra cost to them,” Donnelly says. “We just have two rules—we’re the exclusive agency and we charge 3 per cent plus GST commission.”

The company’s growing book of listings is drawing interest from near and far with inquiries fielded from mostly local but also international buyers—including large fund managers.

Among its current offerings, a 1447sq m mixed-use site at 2-4 Pope Street, Ryde, in Sydney’s north-west growth corridor is on the block for $14.5 million and attracting significant interest from developers and builders. It not only has approval for 70-plus apartments and a new medical practice but also solid holding income from 12 existing residential units and a medical centre.

“It’s an incredible opportunity for an experienced development team,” Donnelly says.

Meanwhile, on Sydney’s Upper North Shore, a 2207sq m site at 205 Eastern Road, Wahroonga, also is in the gaze of buyers with development approval in place for eight high-end townhouses.

In Queensland, 64 Project’s has just listed Victor Island, a 3.13ha speck in the ocean south of Mackay. It is currently home to a four-bedroom private retreat with a caretakers cottage but it is being eyed for its development potential as a luxury eco-resort.

Click here for more information or contact James Donnelly on 0411 333 869.

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