[+] Left on the Blocks: Projects in Limbo as Victoria’s Games Axed

Three hours after Premier Daniel Andrews announced Victoria would no longer be holding the 2026 Commonwealth Games, property developer Jevan Clay was due to meet a major international hotel operator. Until Andrews’ announcement, Clay was confident one of the two international brands he was in talks with would agree to manage his 168-room hotel development, Cunningham Place, on Geelong’s waterfront. Now he’s not sure. “Well, we’ll find out in the next couple of hours as we close these negotiations,” Clay says. “But the Commonwealth Games were certainly an attractive element to both of those operators. So, we’ll just see what the next two weeks brings.” When Clay’s Amber Property Group won approval in April for the $250-million mixed-use project, which includes the luxury hotel, a 5000sq m conference facility with a 650-seat auditorium and an additional 60 apartments with views over Corio Bay, it was billed as the biggest private project to be granted a permit within the City of Greater Geelong. ▲ Amber Property Group’s Jevan Clay. His Cunningham Place hotel development in Geelong was expected to be ready for the Commonwealth Games. In fact, Victoria’s minister of planning Sonya Kilkenny’s office contacted him, saying “the approval of the project underpins the 2400-room shortage identified in Geelong and the Surf Coast”. Construction starts in 12 weeks. Negotiations with hotel operators have been going longer than that. “Their offers were very, very generous on the basis of occupancy performance from day one,” Clay says. “Look, we’re going to motor ahead with it, regardless. But we were hoping to be finished for the Commonwealth Games or at least have that hotel component open and were relying on that to give it a major kick from day one. “This is a real disappointment for us because we’ve invested heavily in regional Victoria and Geelong in particular.” ▲ Property Council of Australia’s Victorian executive director Cath Evans and a render of the indoor sports venue slated for Geelong. Clay’s sentiment has been widely echoed in Victoria and around the World with all levels of the industry reacting with a mixture of shock, disappointment and disbelief. The Property Council of Australia’s Victorian executive director Cath Evans says the cancelling of the Games was “a devastating blow for regional Victoria and for the many businesses across the state” that had committed to support delivery of the event. She called on the Victorian government to provide more details on what support would be available to those companies financially impacted by the decision. “Our members have been heavily engaged in preparation for the Games and have been enthusiastically supporting the state government in delivering what would have been a historic event for Victoria,” Evans says. She says steps needed to be taken to shore up Victoria’s international reputation at a time when investment certainty in the state was under pressure. In a departure from the norm, the Victorian government had announced the 12-day Games would be held outside Melbourne and hosting shared among Geelong, Bendigo, Ballarat, Gippsland and Shepparton. Up to 72 member countries would compete in 20 sports, as well as nine fully integrated para sports. The Games would bring jobs, tourism, housing, showcase the state’s culture and leave a lasting legacy of infrastructure in regional Victoria. “The 2026 Games is about sport and much more—it’s about pride of place, creating jobs in Geelong, driving economic growth and leaving an enduring legacy of accessible, inclusive and fit-for-purpose housing and community infrastructure,” Victorian minister for Commonwealth Games Legacy Harriet Shing said just two months ago . ▲ Victorian premier Daniel Andrews refused to say what the termination would cost. This week the minister—who also holds the portfolio of regional development—stood beside Andrews as he told journalists the Games would cost the state more than $6 billion, which he said was more than double the original estimate. Ballarat town planner and project manager Tim Stevens is unimpressed. He’s spent the past five years securing development approval for two six-storey hotels in the key Games-hosting cities of Ballarat and Shepparton. “We received planning approval for both of them late last year,” Stevens says, “so it was great to know after Covid that we not only had the Covid recovery but we also had the announcement the Commonwealth Games were coming. “But now it puts these $40-million hotel developments in question. “Should we actually go forward with them right now? That’s the discussion I’m literally having today with my client. “It just seems absolutely short-sighted and ridiculous.” Victorian boutique residential property developer Illan Samuel agrees that regional accommodation projects of all types will be the hardest hit by the cancellation. “Whether it’s short stay in a private setting or whether it’s hotel or hybrid, where the regional areas haven’t had much, I think that will be most affected,” Samuel says. “Developers were looking at these towns and saying, ‘Well, we need to host a lot of people’. “And then following that there’s going to be perhaps a more permanent base here because people have come up here and they’ve liked it. And perhaps it’s retail, whether it’s bulky goods, or places for people to spend their money. “Because, again, populations will grow in these areas off the back of better infrastructure.” ▲ Ballarat mayor Des Hudson and the city’s Mars Stadium. The Commonwealth Games Federation, the international body that oversees the direction and control of the Games, says it was given just eight hours’ notice before the cancellation was announced. But spare a thought for the regional municipalities that first heard about the decision when journalists began calling for comments. Greater Geelong City’s mayor Trent Sullivan says it was a very disappointing result. “Geelong and the other regional host cities had been promised a huge amount of tourism, economic, social, and sporting benefits would flow from hosting the Games,” he says. He says they expected more than 7500 jobs would be created before, during and after the Games, and more than 1200 goods and services procurement opportunities were to be available. “Councils entered into this arrangement with the state government in good faith and have invested time, resources and funds to help deliver a successful Games.” Geelong had been promised events such as aquatics, beach volleyball, rowing, women’s cricket, gymnastics, golf, hockey, table tennis and triathlons. ▲ A render of the Armstrong Creek Aquatic Centre in Geelong. The city had scored the swimming events for the Games. The premier refused to say how much he thought it would cost to terminate Victoria’s hosting agreement. But deputy premier Jacinta Allan—also the minister responsible for the Games—confirmed there would be a $2-billion support package for the regional communities affected by the announcement. “Each and every one of the community sporting infrastructure projects that we had been in detailed planning, design and conversations with councils and local communities [for]... each one of those sporting infrastructure facilities will be going ahead,” she says. In Ballarat—which was to host athletics, mountain biking and boxing—the mayor welcomed the pledge. “I’m disappointed by this morning’s news,” mayor Des Hudson said on the steps of the council offices. “We are certainly committed to ensuring that government delivers on what they committed to for our community. “And, I certainly have great confidence that that will be the case.” ▲ A moment from the closing ceremony of the Melbourne Commonwealth Games in 2006. This year Samuel Properties walked away from a property purchase and development in Ballarat—where it had originally planned a hotel in time for the Commonwealth Games. “I think everybody was looking at it closely and feeling like they would cement these locations as really strong regional areas that people would put roots down in based on the sort of infrastructure the Games would bring,” Samuel says. “But I’m certainly very glad that we didn’t push on with Ballarat. “There’ll be things in train in these areas that none of us even know about in terms of sites or zoning or redevelopments. “And you just wonder about some of those phone calls happening this morning, whether people are still comfortable to go ahead or whether they’re thinking about what else is going to change next. “You’re only looking at a decision that might have been made one or two years ago with these Games in mind and then there’s the build costs and the interest rate costs involved in a private development. “You don’t really need one more bad thing to come your way.” You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. 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[+] Left on the Blocks: Projects in Limbo as Victoria’s Games Axed

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