Developers are jostling for elbow room on Sydney’s lower north shore in a bid to attract cashed-up downsizers who want much larger apartment-style living in the post-Covid era.
This swanky part of Sydney has become a mecca for developers, with several key projects bringing new stock to market as cashed-up buyers circle.
Projects are being sold faster than they can be built in part thanks to a six-month lag in development application assessment times due to councils bolstering inspections and requirements under NSW Building Commissioner David Chandler’s cracks down on developers.
Sydney’s lower north shore takes in suburbs next to Sydney Harbour including Neutral Bay, Greenwich, Waverton, Wollstonecraft, Mosman, Cremorne, Lavender Bay, Milsons Point, Cammeray and North Sydney.
A number of commercial and residential projects are under way across the lower north shore. At the time of writing, there were 18 development sites and land listed for sale in this neck of the woods.
Among them is an amalgamated site at 165-173 Military Road, Neutral Bay, which comprises four fully leased, two-storey freehold properties. Indications are that it could sell for more than $17 million.
As well, 49 new and off-the-plan apartments are currently listed for sale.
Sun Property Group confirmed it has $225 million in future value worth of developments on the lower north shore in the pipeline.
This includes the Lane Cove Central Shopping Centre refurbishment, which will be home to six boutique speciality retailers.
A shop-top housing project has developer Thirdi joining forces with Coles Group to create Balfour Place, a soon-to-be-released luxury mixed-use development planned for the existing Coles supermarket site in Lindfield.
The current DA permit across 7091sq m of land allows for the construction of 76 residential apartments atop a new large-format Coles supermarket, Liquor Land, café and heritage commercial space fronting Pacific Highway.
Thirdi also has the $191-million Waranda on Walker project at 63-68 Walker Street in train. This commercial tower aims to lure local people from homes to work in a local office space.
And North Sydney Council has approved plans for an $180-million residential and retail precinct at 12-14 Waters Road, Neutral Bay, called Pienza.
With plans kept under wraps until now, the site amalgamates two lots to create a 1627sq m site. It includes 39 residences, rooftop gardens and infinity pool, along with two levels of commercial space and basement parking, being developed by Central Element.
Fiducia is also wrapping up 10 top-end residences, the Harriette, in Neutral Bay.
Fiducia development director Marie Doyle says the lower north shore is booming, with a significant increase in market value from its first off-the-plan sales in late 2019 and an increase in buyers.
“There’s a strong mix of product available, from boutique infill medium-density residential developments to high-density residential towers, which is attracting developers,” she says.
“The lower north shore is still a very downsizer-friendly market due to its proximity of amenity and there is a sense that the developers doing projects here have a desire to make an impact both architecturally and by delivering a quality product to the purchasers.”
A report by Knight Frank into Sydney’s north shore office sector reveals that 98,026sq m of new supply was added to north Sydney during the second half of 2020, while 47 per cent of all leases went to tech companies.
A number of large tenant relocations saw rising vacancy levels when NAB, Goodman Fielder, U Bank and NSW Health vacated their offices.
Despite commercial vacancies during the pandemic, the lower north shore is a stable market that attracts quality developers, Ray White Projects managing director Eddie Mansour says.
Developments are on the rise, and residential projects include features like communal and private dining rooms, wellness centres, wine cellars, a fireplace, and multi-purpose space for additional accommodation options. Mansour has been involved in the Riserva Cammeray project at 63 Carter Street.
“Buyers interested in this area are prepared to pay a premium for the right layout, the right finish, and the right location,” he says.
“I don’t believe there’s enough quality elements out there in Sydney in general, so there’s plenty of room for more of the same in this area.”
But buyer preferences are evolving, with a desire to be much more connected to an area and community. Top-shop developments that allow residents to pop downstairs to pick up a bottle of wine for dinner are in vogue, developers say.
To achieve this, developers are curating a lifestyle that will appeal to an evolving buyer wanting handy access to specialty supermarkets and restaurateurs on their doorstep, managing director of Central Element Nathan Chivas says.
“Change will be seen within the public domain immediately surrounding Pienza. Pathways will be widened and repaved, inviting pedestrians to wander through and gather at outdoor benches and tables,” Chivas says.
The lower north shore is the key focus for Winim Developments, managing director Josh Leahy says.
The firm generally has between 10 and 20 projects on the go, varying in size, sector and stage of the property life cycle.
However, DAs are dragging out, he says.
“What used to take us five to six months is now taking 12 months to get through council. This is adding a lot more time to the program, which is going to further limit construction supply moving forward,” Leahy says.
Ordering construction materials well in advance is the norm now, he says.
Thirdi director Luke Berry confirms he’s got around $2.5-billion worth of works in the pipeline for the Lower North Shore area. These projects are focused on amenity-driven developments for premium downsizers.
Strong public transport networks, great arterial roads make this area an attractive development target, he says.
“The size of that sector is going to double over the next five to 10 years based on the demographics and the profile of these buyers, and research shows they want to stay local. We’re creating a product they want to downsize into,” he says.
Berry has also jumped into several commercial sites designed to provide flexible office space and more. He points to a strong investment in public infrastructure and a vision to create open spaces for creating a lifestyle that is attracting strong interest from developers.
He agrees that DA delays are frustrating, but understands that a slower approach will ensure quality projects.
“We keep looking for other ways to push those delays forward. When you do finally get assessed, you’ve got to have all your ducks lined up so you can get started right away,” Berry says.
Developments with the ESG elements ticked off are a good opportunity over the next five to 10 years, he says.
“In our opinion, we’re on the cusp of one of the best decades of growth for the lower north shore.”