Kokoda Acquisition Shows Confidence In Brisbane Market

Luxury apartment developer, Kokoda Property Group has made its first move into the Brisbane market - with the acquisition of a development ready site in Newstead for $18.25 million.

Mike Walsh and Peter Court of CBRE’s Capital Markets team negotiated the sale of 7 Chester & 14 Ella Street via an international Expressions of Interest campaign, on behalf of Urban Construct.

Mr Walsh said this sale exemplifies that despite challenging market conditions, there is still developer appetite for strategically situated sites in the Brisbane market.

“CBRE remains committed to unearthing new development capital to Brisbane, with our team introducing six new groups from interstate and offshore over the past 12 months alone. This has contributed to almost $150 million in recent development site transactions, which is significant in the context of the Brisbane market.”

The 3,628sqm site was sold with development approval for two, 18 storey residential towers – providing a gross building area of 49,639sqm. Stage 1 consists of 182 one, two and three bedroom units and Stage 2 comprises 194 one and two bedroom units. The approval also provides a total of 383 car bays and 424sqm of prime ground floor retail.

“Despite existing approvals, Kokoda have completely redesigned the scheme and mix to better align the project with current market demand,” Mr Walsh said.

“The site attracted interest from a wide range of domestic, off-shore and interstate developers, particularly from Victoria.”

“Brisbane remains a strong area of focus for Victorian developers who are finding it difficult to compete in certain segments of the Melbourne market given the depth of competition. The value proposition Brisbane represents, coupled with city defining projects such as Queens Wharf, continues to underpin this market as a compelling and viable opportunity,” said Mr Walsh.

“The site’s existing development approval allowing speed to market and the ability to stage the project were also key factors in appealing to developers,” Mr Court added.

The sale price represented a land rate of $4,961 per sqm - a strong result Mr Walsh attributed to the site’s location in the heart of one of Brisbane’s most sought after inner-city precincts.