[+] Off-The-Plan Luxury Homes Mining Rivers of Gold
It may seem like an expensive gamble but developers are selling luxury homes off the plan for big prices across the eastern seaboard.
“We started flipping homes about eight years ago and we were nestled in Paddington for a while. That’s where off-the-plan started to happen,” one half of south-east Queensland builder-developer Graya, Rob Gray, explains.
Graya recently sold an inner-city luxury home at Hamilton off the plan for $10 million and has launched another in the neighbouring suburb of Ascot.
Gray says they focus heavily on quality renders and marketing early in the process to develop a profile for their projects and brand in the prestige market.
“Obviously as a developer it’s good to de-risk the project earlier,” he says.
“When you’re selling off the plan, you’re leaving a little bit of money on the table but the buyer is also taking on risk so there needs to be some value for them there too.
“We’ve predominantly sold off the plan and our buyers have had a considerable amount of equity in the development once it’s completed.”
Gray says the focus has been on developing prestige properties in Brisbane’s inner-north and on the Gold Coast.
Gray says it is also easier to get demolition approval in these areas than in the tin-and-timber blue ribbon suburbs of New Farm and Teneriffe.
“The planning risk is quite high and the land is too expensive,” he says.
“We got to a size where there were other suburbs that were superior and we could do superior designs and product. We’ve been focusing on Hamilton and Ascot. We think the land prices are undervalued there at the moment.
“We have a database of international expats and interstate people looking for a Graya property but the majority of our buyers have been locals. There’s quite a deep buyer pool in this market, there’s a lot more than you think.”
Graya has just sold SCORPIA (pictured, top) off the plan for $10 million on Brisbane’s Hamilton Hill and is marketing Palma in neighbouring Ascot.
It’s the third project in the inner-north pocket after the success of Larc, also at Hamilton.
Graya began as a construction company and Gray says they apply a similar building methodology to luxury homes as they do to their boutique apartment developments on the Gold Coast. It’s all about attention to detail.
“We actually see the Gold Coast as a really valuable market to expand into, there is more demand for luxury and lifestyle on the coast.
“Views are a really big box tick for us and something that a lot of prestige buyers are looking for. It’s that or a lot of land on a big block.”
Gray says the developer is working through its next acquisitions with future luxury houses in the pipeline.
Further south PB&Co is hoping to break records for a penthouse residence it has built at Brighton, 11km south-east of Melbourne’s CBD, and is selling off the plan.
It’s part of Fifty Two Black, a premium residential development comprising five ultra-luxury residences with three slated for high-end renting and the fully furnished Residence Two and the penthouse on the market.
PB&Co president Michael Pesochinsky says the penthouse is listed for a cool $10 million, which he says would achieve a price per square metre record for the seaside suburb.
Pesochinsky says the leasing opportunities would range from $5500 a night for short-stays, while two apartments have been rented unfurnished for $4000 a week, significantly above the average rent price for the suburb.
“They are getting rented for extremely good prices so we’re very happy with the leasing so far,” he says.
“We just want to test the market before we release the jewel in the crown (the penthouse). It’s not something that’s going to fly off the shelf, we need to find the right buyer.
“We do feel there is a market for prestige off-the-plan homes, and we have a great team to find that clientele.”
Pesochinsky says the Fifty Two Black residences are aimed at the downsizer market, which he believes presents a gap for the developer to fill.
“They do not move at speed … but we have, for quite some time, seen a gap in that market,” he says.
“There’s not enough supply in that space to cater for the growing downsizer demand.”
PB&Co acquired the site more than five years ago and demolished the existing property in 2018, according to Pesochinsky, and completed the build at the end of 2022.
The project was not without its challenges.
Pesochinsky says PB&Co had to contend with pandemic, materials and labour shortages and supply-chain issues. But he says the results speak for themselves.
He says an ultra luxury build-to-rent model could work well in the current market but the developer is focusing on the prestige off-the-plan market.
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