Developers Rethink, Pivot as the Screws Tighten

Developers across Australia are fundamentally rethinking their approach to urban development, prioritising delivery certainty and mixed-use projects as pressure keeps mounting on traditional development models. Speaking at Urbanity-25, The Urban Developer’s flagship annual conference that wrapped up on the Gold Coast on Thursday, three leading developers outlined how their businesses are adapting to market challenges through vertical integration, technological innovation and diversified property types. The discussion revealed a sector increasingly focused on community outcomes alongside financial returns. Versatile Group managing director Fabrizio Perilli said that “Australia needs to evolve to be more transit-oriented and mixed-use” as the country grapples with infrastructure constraints and urban densification pressures. The group’s Crows Nest development backs his call, which Perilli said was “a small site with a five-storey building containing 27 apartments, just a couple of kilometres from the train station” near the new Metro system that “has definitely revitalised parts of Sydney and is changing how different areas operate”. Versatile has embraced vertical integration across development, construction and trade contracting to maintain delivery certainty in an unpredictable market. Perilli confirmed Versatile Construction’s move into the Queensland market, announced earlier this year, and said “we’ve been asked to come up here for many years and had some great opportunities last year”. The company sees potential in addressing Queensland’s “shortage of developers, builders and contractors” through their own developments and third-party contracting services. The trio of developers highlighted the broader economic realities facing the sector. Perilli said selling prices in Sydney need to exceed $18,000 a square metre to make developments viable other than in premium locations. Gallery Group national business development manager Alexandra Stuart-Robertson is backing a different approach to the housing crisis—co-living accommodation. The Gold Coast-based developer has constructed more than 500 co-living homes across south-east Queensland, targeting working professionals with an average age of 31 and annual income of $127,200. Stuart-Robertson sees a disconnect in current planning approaches, questioning “where do you want the teachers, the workers, the employees, to live?” when estate developments prioritise four-bedroom family homes. ▲ Rendering of Gallery Group ’ s tandem-tower proposed for Surfers Paradise. Gallery Group has a waiting list of more than 100 tenants for its co-living properties, highlighting unmet demand in the affordable housing segment. These developments address workforce accommodation needs, with properties “bought by mum and dad investors with residential mortgages” while tenants are “people working in offices” rather than “supported by government or social housing models”. The community-focused approach is evident in its recent decision to sell a 2070sq m Surfers Paradise site with highrise approvals, choosing instead to concentrate on smaller developments. Chief executive Adam Barclay at the time said “we’ve got lots and lots of work in the lowrise residential space as well as boutique projects, so we’re just focusing our attention on that” rather than pursuing tower developments up to 40 storeys. Thirdi founder Ron Dadd has projects ranging from 15-apartment boutique developments to a 700-unit Metro station project in the works. His company has diversified into specialist disability accommodation with more than 100 homes and has expanded internationally to London’s property market. “I remember probably six or seven years ago saying to one of my business partners that there was no way we’d ever do a development overseas,” Dadd said. “Five years later, I moved there with my family. “We’ve now finished a few projects over there and are close to securing another.” Dadd’s pragmatic approach focuses on residential housing “whether it’s land or residential” across multiple geographic markets. Vertical integration emerges as a key competitive advantage in the current environment. Stuart-Robertson said bringing design, construction and marketing capabilities in-house provided “greater transparency, oversight and control” while enabling rapid market adaptation. ▲ Fabrizio Perilli, Alexandra Stuart-Robertson and Ron Dadd on the main stage at Urbanity-25 on Thursday. This allowed developers to “pivot and make the most of opportunities” when market conditions changed during project timelines, she said. Technology adoption varies across the sector, with developers experimenting with artificial intelligence and data analytics to improve efficiency. Gallery Group has implemented client portals allowing 24/7 project monitoring and AI-powered sales assistance. Perilli is keen on innovation, but said that the Australian property development sector lagged US and European markets in technology adoption, partly due to the country’s smaller population limiting economies of scale for innovations such as prefabrication and modular. Market pressures were forcing innovation across the sector, Dadd said. Thirdi has developed AI-powered community consultation tools enabling residents to submit development-support letters, attempting to counter traditional objection-focused planning processes. The group was looking to encourage proactive community engagement rather than reactive damage control, Dadd said. “We’ve been dealing with letters of objection for years as developers and what we’re trying to do is move the needle toward getting people to actually support projects and making it easier for them to support a project.” Gallery Group is positioning for Olympic-related growth. Stuart-Robertson said, “We actually see the bigger opportunity in the 20 years after the Olympics”, citing Sydney’s infrastructure legacy as a model. Developers see community benefit as almost equal to profit maximisation. Perilli said that “our aim is always to leave the community or area better off than before we were involved”—typical of an emerging approach to development that considers long-term social outcomes.

Developers Rethink, Pivot as the Screws Tighten

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