Silverstone Lodges Plans for South Brisbane Medical Facility

Silverstone Developments has lodged plans with the Brisbane City Council for a $150-million medical facility to be built in South Brisbane.

The local developer is planning the 12-storey facility for a 1800sq m site fronting 12 Edmondstone Street.

The site, which was the home of prominent author David Malouf during the 1930s and 1940s, is currently occupied by a small two-level commercial building built in the late 1960s.

The proposed 9000sq m building will feature end-of-trip facilities, ground-floor cafe, a rooftop terrace with city views, and 146 car parking bays in the building’s podium and single basement level.

The Mode-designed development mirrors a similar scheme Silverstone had been pursuing in Spring Hill after lodging plans in mid-2020.

Silverstone’s plan for that tower, spanning 1700sq m at 525 Boundary Street, included a nine-storey development with five levels of medical space, as well as an ambulance bay and hospital-sized lifts.

Similar to its proposal in South Brisbane, the Spring Hill project featured high-quality end-of-trip facilities, a large roof terrace and a ground-floor cafe.

In June, Silverstone cashed in the project, along with another proposed development site at 43 Butterfield Street in Herston, for a combined $131 million.

Both were picked up by the ASX-listed office landlord Dexus.

Soon after, Silverstone sold a significant 2ha development site in Coomera on the Gold Coast to Vital Healthcare Property Trust, managed by NorthWest Healthcare Properties.

The site, which was sold for $9.4 million, is in the Coomera Health Precinct and has been earmarked by Queensland Health for a new public hospital to service one of south-east Queensland's fastest-growing population centres.

Healthcare asset sales volumes and prices are now hitting record levels as new investment by listed real estate investment trusts, investors and developers has surged 12-fold in the past 18 months.

Investors have been increasingly their exposure to high-quality healthcare assets due to low interest rates and the long-term, resilient income of the sector.

According to Real Capital Analytics, REITs chasing higher returns throughout the pandemic made up almost half of all healthcare asset sales since the start of 2020.

As a result of the unprecedented demand, more than $1 billion worth of properties have changed hands during 2021 and is in on track to eclipse more than $1.2 billion worth of properties sold in 2020.

Prices have increased 150 per cent since 2015 and capitalisation rates are now averaging 5.6 per cent.

Dexus has been by far the biggest investor in healthcare properties since 2015, spending $780 million on completed assets for its wholesale Healthcare Property Fund while Northwest is the second biggest buyer of sector assets during the same period, followed by Elanor Investors.