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<div id="3SSZlShovtOv4c7UJxcqGt"></div><div><p>Developer Milligan Group has unlocked one of Sydney CBD’s few remaining prime sites, with plans in the works to build the world’s tallest hybrid timber tower.</p><p>The local developer, led by James Milligan, has received its first tentative tick of approval from council to rezone a 2000sq m site on the corner of Hunter and Pitt streets. </p><p>The proposal, which will be considered by the Central Sydney Planning Committee on Thursday, outlines a 53-storey tower reaching 220 metres—nearly 40 metres higher than <a data-mce-href="https://www.theurbandeveloper.com/articles/worlds-tallest-timber-tower-grange-development-south-perth" href="https://www.theurbandeveloper.com/articles/worlds-tallest-timber-tower-grange-development-south-perth" target="_blank" rel="noopener">Grange Development’s Perth proposal</a> and outstripping Atlassian’s <a data-mce-href="https://www.theurbandeveloper.com/articles/atlassian-unveils-timber-tower-hq-at-tech-central" href="https://www.theurbandeveloper.com/articles/atlassian-unveils-timber-tower-hq-at-tech-central" target="_blank" rel="noopener">180-metre Sydney central HQ</a>.&nbsp;</p><p>The amendments would introduce a new maximum height and increase the allowable floor space ratio from 8:1 to 22:1. In return, Milligan Group would provide a 3 per cent developer contribution to fund community infrastructure and a through-site link, connecting Pitt to Hunter Street.</p><p>If endorsed by council, the proposal will proceed to the state planning department for gateway determination.</p><p>Milligan Group quietly amalgamated seven titled lots to pull off the venture, managing strata owners and individual building owners to combine the 2,108sq m site.</p><p>The site, which sits across 15-25 Hunter Street and 105-107 Pitt Street is close to Wynyard Station and the northern entrance to the Martin Place metro. Its western boundary adjoins the <a data-mce-href="https://www.theurbandeveloper.com/articles/sydney-metro-unveils-hunter-street-station" href="https://www.theurbandeveloper.com/articles/sydney-metro-unveils-hunter-street-station" target="_blank" rel="noopener">future Hunter Metro Station</a>.</p><p>Milligan Group managing director James Milligan declined to comment when approached by <em>The Urban Developer</em>.&nbsp;</p></div><div><picture><img src="//images.ctfassets.net/8pr762qjocl3/6MKTPODdZIFvf9xTdQLGiv/f2b1e939ad3fcf3981a462d7a510516c/Screen-Shot-2022-06-20-at-4.19.50-pm.jpg" alt="A photomontage of the indicative concept design in central Sydney context (aerial). Image: Bates Smart" data-mce-src="//images.ctfassets.net/8pr762qjocl3/6MKTPODdZIFvf9xTdQLGiv/f2b1e939ad3fcf3981a462d7a510516c/Screen-Shot-2022-06-20-at-4.19.50-pm.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Milligan Group amalgamated the site over five years, spending an estimated $300 million. Image: Bates Smart<br><br></span></div></div><p>The tower would have a total gross floor area of 51,150sq m—comprising 43,300sq m of commercial NLA, 5465sq m of retail and a 2390sq m rooftop bar or restaurant.</p><p>The amendments recommended by the City of Sydney require the developer to deliver a minimum 6-star Green Star building, with documents outlining plans for carbon negative construction.&nbsp;</p><p>The proposal retains the Victorian-era Italianate Pangas House, which is not currently identified on local or state heritage lists. It is understood that the City of Sydney is moving ahead with the heritage listing of the four-storey building, despite extensive modifications to the interior of the building made in the 1980s.</p><p>The remaining buildings on the site, a five-storey office building at 19-21 Hunter Street, a 15-storey formerly strata-titled office at 23 Hunter Street and two eight-storey buildings at 105 and 107 Pitt Street, will be demolished.&nbsp;<br></p><div id="3CR51zzFl2a0x6n2rFEGQR"><picture><img src="//images.ctfassets.net/8pr762qjocl3/6MFogsqpMiTNL2RJKaeTbq/f7db950f76b83a51afd2627379715ff8/11113-way-split-new.jpg" alt="Podium form fronting Pitt Street. Image: Bates Smart" data-mce-src="//images.ctfassets.net/8pr762qjocl3/6MFogsqpMiTNL2RJKaeTbq/f7db950f76b83a51afd2627379715ff8/11113-way-split-new.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ If approved, the 53-storey skyscraper will become the world's tallest hybrid timber building. Image: Bates Smart<br><br></span></div><div><p>Milligan Group will be required to undertake a competitive design process—the city’s design excellence strategy now stipulates a minimum 50 per cent of firms must have an Australian principal or lead—in exchange for a 10 per cent uplift in floor space. The gateway sets the timeframes for public exhibition and completion of the planning proposal.&nbsp;</p><p>The developer’s concept plans for the site have been in the works for more than two years. Milligan Group commenced pre-lodgement consultations with the City of Sydney in January, 2020.</p><p>The developer keeps a low profile. Aside from a <a data-mce-href="https://www.theurbandeveloper.com/articles/developer-sells-pyrmont-property-under-construction-for-297m" href="https://www.theurbandeveloper.com/articles/developer-sells-pyrmont-property-under-construction-for-297m" target="_blank" rel="noopener">$297-million deal with Singapore’s Suntec REIT</a> for 21 Harris Street—widely published by the financial and property press—Milligan Group’s projects have largely flown under the radar.</p><p>Previous developments include an A-grade office building in York Street, an 18-unit apartment block in Alexandria and a $107-million Waterloo apartment complex developed in joint venture with Thirdi Group.</p><p>In 2020, Milligan Group sold its current office digs, a warehouse-converted commercial building in Beaconsfield, to Sydney-based asset manager Peak Equities for $20 million.<br><br></p></div></div><hr><p><strong><br>You are currently experiencing <em>The Urban Developer</em> Plus (TUD+), our premium membership for property professionals. </strong><a href="https://www.theurbandeveloper.com/membership-plans" data-mce-href="https://www.theurbandeveloper.com/membership-plans"><strong>Click here to learn more.</strong></a></p><div id="2GhuueZl01Zwo2aFfjNVi2"><picture><img src="//images.ctfassets.net/8pr762qjocl3/12UMq5eMSEOh0QxJVBYaDt/d7507cf4ceb1365cc9ce7eaff84d06cc/tud___banner.jpg" alt="TUD + Banner" data-mce-src="//images.ctfassets.net/8pr762qjocl3/12UMq5eMSEOh0QxJVBYaDt/d7507cf4ceb1365cc9ce7eaff84d06cc/tud___banner.jpg"></picture></div>

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<p>A community group has successfully kiboshed plans for a $300-million apartment tower in South Brisbane, filing an appeal against its approval in the Planning and Environment Court.</p><p>Its developer, Brisbane’s Aria Property Group, is now pursuing a healthcare scheme in its place. Aria won approval for a significantly scaled-back apartment tower, reducing its original plans from 32-storeys to 20, in November.&nbsp;</p><p>Aria development manager Michael Hurley said that the project was no longer feasible.&nbsp;</p><p>“Circumstances have conspired against us. Objections to the scheme, coupled with an overheated construction market have rendered the project unfeasible.”</p><p>The revised 20-storey Urban Forest apartment scheme, marketed as “the world’s greenest residential building”, is the subject of the West End Community Association’s appeal.&nbsp;</p><p>“It’s the straw that broke the camel’s back,” Michael Zaicek, Aria’s commercial manager, told <em>The Urban Developer</em>.</p><p>“And build costs have gone up 30 per cent in less than nine months.</p><p>“There’s so many factors at play, if we’re sitting in the planning court for six, nine or 12 months, the builder won’t hold that price.”</p><div id="1YdqHooEcAGmwfEOR9QCHR"><picture><img src="//images.ctfassets.net/8pr762qjocl3/6BgIqfnyehh4lgmA7BXaxL/684831cfd940df6d6e53ff96b256cc3e/GlenelgSt.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/6BgIqfnyehh4lgmA7BXaxL/684831cfd940df6d6e53ff96b256cc3e/GlenelgSt.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ After scaling back its original 32-storey scheme, Aria’s approval for a 20-storey apartment tower on Glenelg Street has been appealed by a West End community group.<br><br></span></div></div><p>Zaicek said that, while Aria hasn’t entirely jetissoned the residential scheme, they’re progressing the medical development application.&nbsp;</p><p>“We’ve lodged the medical DA, we’re preparing marketing packs, talking to tenants and we’ve set ourselves internal targets. If we get a certain number of precommitments we’ll progress the commercial project.”</p><p>Aria lodged plans for the 2400sq m site on Monday with the Brisbane City Council. The documents outline a medical building with 15,642sq m of NLA and 326 carparks across five basement levels. The healthcare scheme, unlike the residential tower, is code compliant at 12-storeys.</p><p>“The site is great, it’s over the top of Southbank, close to all the major roads and the biggest hospital precinct in the southern hemisphere,” Zaicek said.</p><p>“It’s an interesting prospect—it opens up medi-hotels, private hospital operators or a collection of smaller healthcare tenants.” Zaicek said.</p><p>“Basically we’re out talking to everyone. It’s a lot of NLA, it brings into play everything from private hospitals to smaller medical tenants. There’s a lot of requirements around the 2000 to 3000sq m mark.”&nbsp;</p><p>Whether the developer will retain the asset is not yet up for discussion, but given the <a data-mce-href="https://www.google.com/url?q=https://www.theurbandeveloper.com/articles/healthcare-yields-decline-institutional-investor-capital&amp;sa=D&amp;source=docs&amp;ust=1652243219976078&amp;usg=AOvVaw31mGkmjAOrtGAV6c9VtJd_" href="https://www.google.com/url?q=https://www.theurbandeveloper.com/articles/healthcare-yields-decline-institutional-investor-capital&amp;sa=D&amp;source=docs&amp;ust=1652243219976078&amp;usg=AOvVaw31mGkmjAOrtGAV6c9VtJd_">institutional appetite for the fast-growing sector</a>, and cap rates sitting around 4.5 per cent, it has caught Ziacek’s interest.</p><p>“It’s a strong proposition. With our balance sheet and our track record of delivery, we can compete hard in this space.”</p><p>If the scheme progresses, Aria will follow in the footsteps of private Brisbane developer Silverstone, which has <a data-mce-href="https://www.google.com/url?q=https://www.theurbandeveloper.com/articles/dexus-healthcare-development-sites-brisbane-131m&amp;sa=D&amp;source=docs&amp;ust=1652241705164965&amp;usg=AOvVaw0M8vRk3Pd0wK_xpAJDd8hS" href="https://www.google.com/url?q=https://www.theurbandeveloper.com/articles/dexus-healthcare-development-sites-brisbane-131m&amp;sa=D&amp;source=docs&amp;ust=1652241705164965&amp;usg=AOvVaw0M8vRk3Pd0wK_xpAJDd8hS">offloaded purpose-built healthcare developments</a> to Charter Hall and Dexus.</p>

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The Urban Developer’s list of the top 10 builders reveals the top-performing firms and projects shaping Australia’s built environment…

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<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>The “see you after Australia Day” attitude adopted by some employers isn’t doing office landlords any favours, Dexus boss Darren Steinberg says.</p><p>The chief executive of Australia’s largest office landlord said occupancy varied significantly among buildings, as tenants look to Australia Day as a signpost of the 2022 return.</p><p>“Some of our business customers, some of them big multinationals, decided ‘we’ll see you after Australia Day’, rather than just getting on and getting business thriving.</p><p>“Pleasingly, in the past couple of weeks we’re seeing a lot more activity around the city, particularly here in Sydney and in Melbourne. Brisbane and Perth are [closer] to normal.</p><p>“It’s quite building specific, funnily enough you’ve got buildings like [the 55,000sq m] Australia Square and [the 41,818 sq m] Governor Phillip Tower where they’re back to circa 80 per cent occupancy.</p><p>“But other buildings are 10 to 20 per cent, if you’re lucky, and as a result all businesses that live off the populations in the city are struggling to come back to normal.”</p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/3bb0d973-52d2-4bb9-b258-901b9a9dfce1.jpg" width="900"/></picture><div><span style="align-content:center;opacity:0.8">▲The panel at the Australian Financial Review Property Summit on Wednesday. Photograph: Janie Barrett.</span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Steinberg appeared alongside Charter Hall CEO David Harrison, Brookfield managing partner Sophie Fallman and JLL boss Stephen Conry at the <em>Australian Financial Review</em> Property Summit on Wednesday.</p><p>In a later session, Charter Hall office chief executive Carmel Hourigan noted an encouraging increase in the number of tenant briefs from the private sector in the leasing market.</p><p>“An interesting trend we’ve seen in the last few months is in the private sector. There hadn’t been a lot of large briefs in the market. </p><p>“In the last three weeks, we’ve seen the number of briefs in the market go from around 26 to 40, about 130,000sq m [in requirements].” </p><p>While the office market is <a href="https://www.theurbandeveloper.com/articles/office-market-rebound-leasing">tipped to make a strong recovery</a> in 2022, robust net additions to the Sydney and Melbourne CBD office markets will continue to present headwinds. </p><p>Office supply is running well above the long-run averages in Sydney and Melbourne, according to Oxford Economics analyst Thomas Creevey.</p><p>“Net additions will have contributed 5 percentage points in Sydney and almost 9 percentage points in Melbourne to rising vacancy rates by the end of this wave of supply,” Creevey said.</p><p>Hourigan said a recovering labour force had helped underpin bigger tenant requirements in the leasing market. </p><p>“I think people have been surprised about how much they’ve grown in terms of employment. Recruiters must be making an absolute fortune at the moment.” </p></div></div></div></div></div>

The “see you after Australia Day” attitude adopted by some tenants isn’t doing office asset owners any favours, Dexus boss Darren Steinberg says...

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<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>Canadian healthcare REIT Northwest has received council approval for an 11-storey addition to the heritage-listed Epworth Freemasons hospital in East Melbourne.</p><p>The approval by the City of Melbourne on Tuesday comes as the healthcare giant kicks off the masterplanning of its $350-million expansion next to Epworth Eastern hospital in Box Hill. </p><p>The Northwest-managed Vital Healthcare property trust acquired the 5330sq m brownfield site on Nelson Road, Box Hill in February for $29 million—and has plans to develop as much as 40,000sq m of infrastructure on the site. </p><p>Epworth Healthcare, who will lease back both properties, is Victoria’s largest not-for-profit private hospital. </p><p>Chris Adams, who heads up Northwest’s development arm, told <em>The Urban Developer</em> that Northwest is looking across the spectrum of healthcare.</p><p>“Hospitals, life sciences, health precincts. Our portfolio of development propositions is well north of $1 billion, and we have ten projects currently under construction—totalling around $350-million,” he said. </p><p>The challenge for newcomers to the sector, Adams said, was the healthcare sector’s high-degree of complexity and commitment required. </p><p>“The sector’s the flavour of the day, healthcare is a specialist area—stock is tightly held and there’s a large number of specialist stakeholders involved,” he said.   </p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/bb624c14-87fa-486e-8a8c-8c303bff04b6.jpg" width="800"/></picture><div><span style="align-content:center;opacity:0.8">▲ The second stage DA will cost $50 million. Image: John Wardle Architects.  </span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Northwest’s Australian assets make up more than 40 per cent of the healthcare trust’s $4-billion-plus portfolio.</p><p>Northwest’s global president and Australian boss Craig Mitchell said the <a href="https://www.theurbandeveloper.com/articles/canadian-giant-northwest-eyes-healthcare-expansion">property facility was critical</a> <a href="https://www.theurbandeveloper.com/articles/canadian-giant-northwest-eyes-healthcare-expansion">to the group’s core</a> <a href="https://www.theurbandeveloper.com/articles/canadian-giant-northwest-eyes-healthcare-expansion">business</a>.</p><p>“As healthcare delivery models change we need to ensure the physical infrastructure of these highly-specialised assets accommodate the operational needs of our partners for many decades.”</p><p>Other recent acquisitions include a 3036sq m site in Brisbane’s Woolloongabba for $11.4 million and 20,131sq m of developable land in Coomera on the Gold Coast for $9.4 million. </p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/9c0690d7-3579-41b4-bcb3-ed2cfee05ee6.png" width="500px"/></picture><div><span style="align-content:center;opacity:0.8">▲ Northwest acquired a 5300sq m brownfield site next to the Epworth Eastern hospital in Box Hill for $29 million.  </span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Meanwhile, Northwest’s takeover of Australian Unity Healthcare Property Trust has stalled, with reports that capital partner GIC is reconsidering its 70 per cent contribution to the bid. Northwest has been agitating for a takeover of Australian Unity’s healthcare fund since making an initial offer in February. </p><p>Australian Unity Healthcare Property Trust unit-holders are set to vote on Northwest’s offer by 12 July—the vote will be further complicated by Dexus’ recent 7 per cent cornerstone investment in the fund. </p><p>On the sector more broadly, Dexus CEO Darren Steinberg said the investment in Australian Unity’s healthcare trust has accelerated the group’s “growing footprint in healthcare real estate”. </p><p>Less than 10 per cent of the <a href="https://www.theurbandeveloper.com/articles/investors-healthcare-property-development">$100-billion institutional-grade Australian healthcare assets are securitised</a> compared to 90 per cent of retail, office and industrial assets. </p></div></div></div></div></div>

Canadian healthcare REIT Northwest has received council approval for an 11-storey addition to the heritage-listed Epworth Freemasons hospital...

Phil Pearce on Striking History-Making Property Deal

<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>ESR Australia and capital partner GIC has picked up Blackstone’s $3.8-billion portfolio of warehouse and industrial assets in the largest direct property deal in Australian history.</p><p>The deal, finalised on Saturday night, was struck on a 4.5 per cent yield and makes ESR the third-largest manager of industrial real estate in the country behind Goodman Group and Charter Hall.</p><p>The 45-asset portfolio returns about $160 million in fully-leased income annually with a 6.9 weighted average lease expiry and includes assets in Sydney, Melbourne, Brisbane, Adelaide and Perth.</p><p>Private equity giant Blackstone opted for a trade sale over an IPO, for which it had tapped Morgan Stanley and JPMorgan to run a dual-track process for its so-called “Milestone portfolio”. </p><p>AXA and Logos, along with Mapletree and ASX-listed Dexus, made up the final five bidding groups for the portfolio.</p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>ESR chief executive Phil Pearce said that the group had been preparing for a potential sale of the Blackstone portfolio since ESR Cayman established a presence in Australia in 2018.</p><p>“We knew that Blackstone had the portfolio and had assembled it over a number of years, and suspected that they would ultimately sell it as they had done in Europe and the US,” he said.</p><p>“So there is a massive sense of relief because it has been a focus and key objective to secure this portfolio for a number of years.” </p><p>Pearce said that the ESR Australia team had been working on the deal since January. ESR will contribute 20 per cent of the equity, with Singapore’s GIC making up the remaining 80 per cent. </p><p>The portfolio will be managed under the newly-formed ESR Milestone Portfolio (EMP) and includes the acquisition of Blackstone’s management platform. </p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/4926043a-1c23-4a3e-87a4-40179273e0f1.jpg" width="800"/></picture><div><span style="align-content:center;opacity:0.8">▲ ESR Australia CEO Phil Pearce. ESR outbid AXA IM and Logos, Dexus, and Singapore&#x27;s Mapletree to secure the portfolio. </span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>The sizeable deal underscores shifting investment preferences towards warehousing <a href="https://theurbandeveloper.com/articles/mubadala-kkr-team-up-with-logos-group">assets</a> in Australia—a key beneficiary of the sustained <a href="https://theurbandeveloper.com/articles/lockdowns-e-commerce-fuel-warehouse-shortage-ubs">growth</a> in ecommerce sales during the pandemic.</p><p>Pearce said the structural changes in the industrial sector and continued demand for logistics real estate would support rental growth in the medium- and longer-term.</p><p>“We are a long-term investor, so we’re more interested in the total return over a number of years,” he said.</p><p>“The initial yield is not the main domain focus for us, the outlook for rental growth and the opportunity for development upside [is what attracted us] to the portfolio.”</p><p>With a land area of 3.6 million sq m and gross lettable area of 1.4 million sq m, the site cover sits at 38 per cent—providing significant scope for further development.</p><p>“We certainly didn’t look at it as a passive investment, it was a portfolio we worked very hard. We’re prepared to activate the development opportunities once they became available,” Pearce said.</p><p>“It’s the icing on the cake in terms of the return. I think active portfolios give you the opportunity to outperform if you execute on your strategy.”</p><h2><strong>Transaction ‘won’t be seen again’ in Australian logistics</strong></h2></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/2671fba9-4991-433e-ae6e-0327d4195809.jpg" width="800"/></picture><div><span style="align-content:center;opacity:0.8">▲ Institutional demand for logistics is expected to further cap rates compression in the sector.</span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>JLL industrial head of capital markets Tony Iuliano, who advised Blackstone on the sale, said that the data room involved 54 groups. </p><p>“A combination of sovereign wealth funds, pension funds, REITs and life insurance groups totalling $45 billion of capital that participated,” he said.</p><p>“This transaction is a transformational event and one which will most likely never be seen again in logistics.</p><p>“It’s history in the making. The opportunity to access more than 90 tenants and a management platform with significant IP is enormous for any group.” </p><p>Research from the commercial real estate agency estimates $45 billion of capital will be deployed into the industrial sector in 2021. </p><p>For context, Iuliano said that there had been an annual average of $4.5 billion in industrial investment sales in recent years.</p><p>More than 2 million sq m of supply was added to the industrial sector during 2020, pushing development pipelines to 13-year <a href="https://theurbandeveloper.com/articles/industrial-development-pipeline-investments">highs</a> along the eastern seaboard. </p><p>UBS analyst <a href="https://theurbandeveloper.com/articles/lockdowns-e-commerce-fuel-warehouse-shortage-ubs">Grant McCasker said</a> that the lion’s share of new industrial property in 2021 will be led by development in Sydney’s 850ha Mamre Road <a href="https://theurbandeveloper.com/articles/nsw-mirvac-mamre-road-industrial-precinct">precinct</a>. </p><p>“Despite the solid demand outlook, rental growth is likely to remain flat in outer markets reflecting increased supply and low cap rates,” he said. </p><p>Nearly 80 per cent of Blackstone’s industrial portfolio is on the eastern seaboard, with more than half of the portfolio in Melbourne. Tenants include international cold storage giant Lineage Logistics, WesTrac, Toll and Woolworths.</p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/a9387aca-f350-46cc-a318-9f87561065d0.jpg" width="800"/></picture><div><span style="align-content:center;opacity:0.8">▲ Blackstone opted for the trade sale over a $1 billion-plus public listing.</span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Blackstone had pulled together the portfolio across nearly 30 different transactions, starting with the $640-million acquisition of 26 industrial assets from ASX-listed Goodman Group in 2016.   </p><p>Morgan Stanley, JPMorgan, Eastdil and JLL advised Blackstone on its exit. </p><p>ESR Australia remained largely self-advised with Savills providing valuation services and Norton Rose Fulbright providing legal advice. </p><p>With the process now at an end for its milestone portfolio, Blackstone may instead turn its attention to its <a href="https://theurbandeveloper.com/articles/blackstone-modifies-crown-buyout-deal">pursuit of Crown Resorts</a>. </p><p>The troubled gaming giant struck a deal with the NSW Independent Liquor and Gaming Authority on Friday—with Packer retaining his 37 per cent stake, meaning he can still play a role in accepting, or rejecting, any takeover proposals. </p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><hr/></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><strong>You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. </strong><a href="https://www.theurbandeveloper.com/membership-plans"><u><strong>Click here</strong></u><strong> to learn more.</strong></a></p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/42d51508-aada-42ab-86fe-bfab156730c0.jpeg" width="720"/></picture><div></div></div></div></div></div></div></div>

ESR Australia and capital partner GIC has picked up Blackstone’s $3.8 billion portfolio of warehouse and industrial assets...

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<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>The anchor asset of embattled funds manager Mayfair 101’s portfolio, Dunk Island, is back on the market. </p><p>The 135-hectare island was repossessed earlier this year after Mayfair 101 <a href="https://theurbandeveloper.com/articles/dunk-island-investor-mayfair-101-enters-receivership">missed</a> almost $3 million of repayments and failed to see through the $31.5 million contract <a href="https://theurbandeveloper.com/articles/mayfair-101-buys-dunk-island">price</a>. </p><p>JLL Hotels and Hospitality Group has been tapped to sell the asset.</p><p>The listing comes as the James Mawhinney-led Mayfair 101 and it’s $80 million IPO Wealth Fund battles a winding-up application by corporate regulator ASIC. Mawhinney has vowed to fight the application and has tabled a restructure and rescue proposal to investors.  </p><p>Dunk Island, one of only three freehold islands on the Great Barrier Reef, is located four kilometres off the coast from Mission Beach in far north Queensland. The island was <a href="https://theurbandeveloper.com/articles/mayfair-101-buys-dunk-island">acquired</a> by Linc Energy founder Peter Bond in 2011 for $7.5 million shortly after it was devastated by Cyclone Yasi.</p><p>Mayfair 101 had planned a billion-dollar redevelopment of the island, with the group’s investor-facing brand, Mayfair Platinum, raising more than $100 million to finance the project.</p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/dbb52970-8f12-4a82-894f-b233b73d7b25.jpg" width="720"/></picture><div><span style="align-content:center;opacity:0.8">▲ Mayfair&#x27;s plans for the billion-dollar &quot;tourism mecca&quot; have hit another hurdle as Dunk Island is listed for sale. </span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Mayfair’s 15 year plans for the area included the acquisition of more than 200 properties in the Mission Beach area and the restoration of Dunk Island into the “<a href="https://theurbandeveloper.com/articles/mayfair-101-buys-dunk-island">tourism mecca</a> of Australia”. </p><p>The island was previously owned by Qantas and cruise company P&amp;O, while the former 4.5-star Dunk Island resort features 160 rooms, a 9-hold golf course and restaurants.   </p><p>JLL’s Andrew Langsford said that the development of the island remains on the cards.</p><p>“We anticipate the Great Barrier Reef accommodation market to be a strong beneficiary of Australia’s high overseas spend, much of which is expected to be diverted to high-end resort locations.”</p><p>A report filed by liquidators in September revealed that $67 million of secured noteholders were unlikely to receive a return. </p><p>Grant Thornton liquidator Said Jahani said that the business model of the group was “not sustainable”, and that M101 Nominees Pty Ltd had been insolvent since its inception.  </p><p>The Federal Court will hear ASIC’s winding-up application in early February 2021, while noteholders will consider Mayfair’s restructuring plan over coming months.</p><p>The Dunk Island asset is being offered for sale via an expressions of interest campaign.      </p></div></div></div></div></div>

The anchor asset of embattled funds manager Mayfair 101’s portfolio, Dunk Island, is back on the market. 

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<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>Developer Blueways Group has won approval for 600 land lots in Melbourne’s north-west, as government stimulus and ultra-low interest <a href="https://theurbandeveloper.com/articles/stimulus-pushes-lending-to-record-highs">rates</a> drive buyer interest in affordable land <a href="https://theurbandeveloper.com/articles/buyers-affordable-suburbs-macroplan-corelogic">markets</a>.</p><p>Now with permit in hand, Blueways is heading to market at the 42-hectare Fraser Rise estate it acquired last year for about $50 million.  </p><p>As display suites <a href="https://theurbandeveloper.com/articles/floodgates-open-on-melbourne-market">reopen</a> across Melbourne, the developer has launched the first stage of “Taylors Run” neighbouring Melton City Council’s fast-growing Plumpton.   </p><p>Blueways development director Andrew Wyatt said that the project has received enquiry from more than 700 buyers. </p><p>“We launched the project on Thursday, and sold out half of stage one—50 lots—in the first nine hours,” Wyatt said.</p><p>The project is minutes from the 135-hectare Caroline Springs town centre, developed by Lendlease and Delfin in the early aughts, which turned large swathes of farmland in Melton Shire into a major growth hub. </p><p>“It was part of what attracted us to Fraser Rise,” Wyatt told <em>The Urban Developer</em>. </p><p>“The amenity is established, it’s a good anchor point for us. The fundamentals on our side are really good for amenity—one-third of our site has waterways and wetlands.” </p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/b5166c02-efdc-45bc-b3b5-9cd021314ee8.jpg" width="800"/></picture><div><span style="align-content:center;opacity:0.8">▲ An artist rendering of Blueways Group&#x27;s Fraser Rise estate.</span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Wyatt said the initial subset of buyers were largely families, first home owners and investors looking for longer settlements. </p><p>Red23 managing director Terry Portelli said that investors were beginning to reemerge in Melbourne’s greenfield in the hope of some uplift in the market over the next 18 to 24 months.</p><p>“First home buyers continue to be the majority of sales made in the current climate, with investors [now] educated in the price and affordability of land and new homes and seeking long settlements.”</p><p>Compared with 5.5 per cent <a href="https://theurbandeveloper.com/articles/house-price-drop-starts-to-slow">house price falls</a> in the inner city, Melbourne’s regional markets have declined 0.5 per cent since March. According to Red23 data, the average land size in Melton is 392sq m, while median prices remained stable over the September quarter at $296,000.</p><p>The Australian arm of Blueways Group was established by Andrew Wyatt and Qingmin Zhang in 2015 and has a 5,000-lot pipeline across Melbourne’s greenfields. </p><p>The developer has partnered with Melbourne’s Wolfdene Group for sub-divisions in Skye and Donnybrook. </p></div></div></div></div></div>

Developer Blueways Group has won approval for 600 land lots in Melbourne’s north-west.

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<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>Tech giant Microsoft is the latest multinational conglomerate to announce it will permanently embrace working from home, stoking commercial landlords’ fears of serious structural changes to the office landscape.</p><p>As office market negative net absorption nears the -200,000sq m mark over the third quarter, a recent analysis of multi-residential projects reveals there is opportunity for developers to pick up on serious unmet demand. </p><p>Research by not-for-profit University of Melbourne alumni organisation Ignite ABP Network says that developers should consider creating dedicated co-working space in their projects.</p><p>“A home study may not be the best solution for the 88 per cent of people choosing to work from home after the pandemic,” researchers Trevor Du, Matko Matkovic and Derek Huynh said.</p><p>“Evidently, there is an opportunity for developers to re-think the amenity mix and improve its relevance to purchasers post-pandemic.” </p><p>The trio’s research identified only one project of 35 recent Melbourne build-to-sell projects as offering a co-working space for residents. </p><p>Before coronavirus, only 5 per cent, about one in 20 people, worked from home. Mandatory lockdowns and restrictions has pushed the number <a href="https://theurbandeveloper.com/articles/covid-19-pushes-46pc-to-work-from-home-abs-australian-office-market">closer to 50 per cent</a>, according to demographer Bernard Salt. </p><p>“It raises the question, what proportion will it go back to? Will it go back to four or 5 per cent?” Salt said. </p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><div><picture><img src="https://tud-prod-tudmedia-oj9w2zshuo0o.s3.amazonaws.com/raw/images/38222866-9d1b-462d-b1ea-c5db6c8ad300.jpg" width="800"/></picture><div><span style="align-content:center;opacity:0.8">▲ Microsoft has announced it will offer a &quot;hybrid workspace&quot; giving workers the option to work remotely for 50pc of the work week. Image: Microsoft HQ, Munich.   </span></div></div></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p><br>Speaking at the National Housing Finance and Investment Corporation <a href="https://www.nhfic.gov.au/media-resources/media-releases/nhfic-research-webinar-employment-housing-demand-and-covid-19/">webinar</a> on employment and housing demand, Salt predicts a major step change in the proportion of people working from home.  </p><p>“I say it will go back to maybe 10 per cent or 15 per cent. And I think it is the major cultural shift that I think will reshape the narrative of Australian life and change Australian housing.</p><p>“For every extra 5 percentage points it’s another 600,000 workers. So [if] it’s another 15 per cent of workers working from home, it’s another 1.2 million not working in the city or commuting.  </p><p>“It has a major impact on the demand for commercial property and an impact on housing. The kind of housing you will need if there’s a step change in the proportion of the workforce working from home.” </p><p>As part of Huynh, Matkovic and Du’s research, they engaged a developer to evaluate whether the high demand for apartment co-working justified the replacement of other amenity in high-rise projects.</p><p>“A 260 square metre space originally earmarked for a gym could accommodate up to 132 people per week if repurposed for apartment co-working.</p><p>“This is equivalent of about one full-time worker or three part-time workers per five square metres. </p><p>“It is worth questioning whether the gym—or any other amenity—would have the same rate of utilisation and engagement.” </p><p>Office markets recorded negative net absorption of -193,700 over the third quarter, according to JLL research.</p><p>Five of the six monitored office markets recorded negative net absorption as corporates continue to assess headcount expectations for the next 12 to 18 months.</p><p>“The economic crisis has negatively impacted business confidence,” JLL head of research Andrew Ballantyne said.</p><p>“Corporate Australia is the new landlord in town with a sharp increase in sublease availability across the Sydney CBD and Melbourne CBD.” </p></div></div></div></div></div>

Tech giant Microsoft is the latest multinational conglomerate to announce it will permanently embrace working from home.

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<div class="row" data-reactroot=""><div class="cell cs12 cx12"><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><p>Government stimulus has shown up in the latest lending figures as Australians take advantage of record low interest rates and government <a href="https://theurbandeveloper.com/articles/home-builder-residential-housing-stimulus-package">support</a> to invest in new housing. </p><p>Housing finance grew 12.6 per cent in August, outstripping the previous 10.7 per cent <a href="https://theurbandeveloper.com/articles/largest-rise-in-home-loans">gain in July</a>, with first home buyers and owner-occupiers leading the charge.</p><p>First home buyers grew 18.3 per cent, while owner-occupiers clocked a 13.6 per cent increase—the largest month-on-month rise in the history of the series.</p><p>Housing finance figures are expected to increase again when the removal of responsible lending curbs take effect and place <a href="https://theurbandeveloper.com/articles/responsible-lending-laws-peeled-back">upward pressure</a> on house prices despite <a href="https://theurbandeveloper.com/articles/demand-apartment-markets-coronavirus">stagnant</a> net migration acting as a counter weight.</p><p>ABS’ August figures reflect customer demand in June and early July—prior to Victoria imposing its stage 3 and stage 4 <a href="https://theurbandeveloper.com/articles/covid-construction-industry-melbourne-lockdown-retail">restrictions</a>. </p><p>Westpac economist Matthew Hassan said the impact on lending from Melbourne’s lockdown will be seen in next month’s figures. </p><p>“However, some other drivers of the strength in August will continue,” Hassan said.</p><p>“Reopening rebounds are likely to gather momentum in other states—‘catch-up’ activity augmented by low interest rates and ongoing fiscal supports.” </p><p>Meanwhile, the Reserve Bank said that rising levels of financial stress will increase the risk of home loan defaults. </p><p>In its bi-annual financial stability review, the bank said that if the unemployment rate hits 10 per cent it will double the rate of housing arrears. </p><p>“While credit is available at very low interest rates, reduced housing demand from very low immigration and the rise in unemployment contribute to the risk of further falls in housing prices,” the central bank said.</p><p>“This increases the potential for losses for lenders in the event of a rise in distressed sales.”</p><p>Mortgage arrears are <a href="https://theurbandeveloper.com/articles/deferrals-mask-covids-true-hit-on-mortgage-arrears">expected to increase</a> once the payment deferrals period ends.</p><p>Almost 900,000 mortgages, about one in 10, were deferred in March. By August, 9 per cent of loans worth $160 billion remained on deferral.</p><p>S&amp;P analyst Erin Kitson said mortgage arrear rises are likely to be more pronounced in Victoria and areas where tourism is a major employer.</p></div></div></div><div class="row ci"><div class="cell cs12 cx12"><div class="ci cl"><hr/></div></div></div></div></div>

Government stimulus has shown up in the latest lending figures, with housing finance growing 12.6 per cent in August...