WA Council’s ‘Project Dorothy’ Backs Private Rental Projects

The City of Karratha has released a business plan for public comment on a proposed 116-apartment development across three sites in Bulgarra. The proposal is part of the council’s Housing Development expression-of-interest initiative known as Project Dorothy. Private developer Karratha Development will build and operate the residential complexes on council-owned land under a 20-year lease. The consortium behind the development is led by Developed Projects and includes TLC Modular, Deloitte PDS Group and WA property management firm Realmark. The group has experience in modular construction across Australia and internationally, including projects for Roy Hill Iron Ore and Chevron. The three development sites, 1250km north of Perth and 180km west of Port Hedland, comprise 30 Nairn Street (5501sq m), 17 Ridley Street (5105sq m) and Lot 751 Gregory Way (9545sq m). The largest site by area, Lot 751 Gregory Way will comprise 36 apartments with 12 one-bedroom, 18 two-bedroom, and six three-bedroom units. The 30 Nairn Street site will house the highest number of apartments, 48 units, comprising 15 one-bedroom, 27 two-bedroom, and six three-bedroom units. The 17 Ridley Street development is 32 apartments consisting of eight one-bedroom, 20 two-bedroom, and four three-bedroom units. Delete All three-bedroom apartments will have two bathrooms, while all two-bedroom units will feature two bathrooms. Under the proposal, the City of Karratha would provide a $56-million loan to the developer at 4 per cent interest over 20 years. The completed apartments would be managed by the proponent and supplied to the private rental market with starting average weekly rents of $967, increasing by 2.75 per cent a year. City of Karratha mayor Daniel Scott hopes the plan will help address a critical housing shortage facing the region. “Housing is the number one issue our community faces, and there has been little to no activity to generate new supply,” Scott said. “Our modelling indicates a current shortfall of 900 dwellings, and with major projects scheduled for completion over the next few years this shortfall could increase to 2000.” The business plan projects a net cash outflow for the council of $9.1 million over the 20-year lease term, while the council would inherit assets with a forecast book value of $46.6 million, providing a projected net return of $37.5 million. ▲ Under the deal, the state agreed to provide the land at a 23 per cent discount, equating to about a $470,000 reduction on market price. The construction timeline aims for development approval by June, construction under way in August and completion by January of 2027. The project will use modular construction techniques, with modules made offshore and WA-based contractors handling site works, installation and landscaping. The city has a tight rental market with vacancy rates at 1 per cent and median weekly rents of $1204. Population growth of 30 per cent over five years is projected for the region. Public submissions on the business plan are being considered, with council expected to make a final investment decision following the consultation period. Late last year, the Regional Development Assessment Panel approved a controversial $120-million hotel development in nearby Nickol , despite City of Karratha concerns that the 832-room project more closely resembled worker accommodation than a traditional hotel. The development would turn a 6.3ha caravan park site into a modular built complex with family, executive, deluxe and standard suites.

WA Council’s ‘Project Dorothy’ Backs Private Rental Projects

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WA Council’s ‘Project Dorothy’ Backs Private Rental Projects

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