[+] manufactured stone hero WEB.jpg

<p>With the South Australian and Western Australian governments now on board a ban on engineered stone, it seems it is only a matter of time before a national ban becomes a reality.</p><p>This week those two states joined other state governments in pledging to implement a ban on using, making or importing engineered stone if the federal government does not impose a national ban.</p><p>For workers, a ban will mean the end to the risk the material poses—deaths from silicosis. It may also mean increased cost pressures due to more expensive alternatives.</p><h2>Hard facts about manufactured stone</h2><p><br>Engineered stone is a manufactured product composed of crushed stone that is bound together by an adhesive to look like a stone slab.</p><p>It is a cheaper than natural stone slabs, marble or similar products as it can be manufactured at a lower cost than the cost of quarrying and transporting the real thing.</p><p>But the crushed stone can contain silica dust—if that is inhaled by workers making, transporting or installing the product can cause silicosis.</p><p>Silicosis is a lung disease expected to disappear when mining and quarrying work began to be handled more safely thanks to technology but made a resurgence among Australian tradespeople and associated workers.&nbsp;</p><p>It is also a proclaimed disease, so workers and their dependents are entitled to claim compensation without proof that work contributed to the disease.&nbsp;</p><p>In October, 2023, the Lung Foundation Australia estimated that nationally nearly 600,000 Australian workers, including stonemasons, are exposed to silica dust.&nbsp;</p><p>It also predicted that silica dust exposure would cause more than 10,000 new lung cancer cases and up to 100,000 silicosis cases.</p><div id="4YTzEitM7eINwcla6HRtN4"><picture><img src="//images.ctfassets.net/8pr762qjocl3/2sW3xF0gZytxq0ylAJlQXe/737ac0032c01634b27038427f676f78c/roger_cook_silicosis_article_mid.jpg" alt="Western Australian premier Roger Cook has just announced that the state will join the call for a national ban on the use and import of engineered stone." data-mce-src="//images.ctfassets.net/8pr762qjocl3/2sW3xF0gZytxq0ylAJlQXe/737ac0032c01634b27038427f676f78c/roger_cook_silicosis_article_mid.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Western Australian premier Roger Cook has announced his state will join the call for a national ban on the use and importation of engineered stone.<br><br></span></div></div><p>“There is no safe level of exposure to silica dust and this insidious disease, which has no cure, is going to affect thousands of people during the next few years,” Lung Foundation Australia’s senior manager, Elizabeth Early, says.</p><p>“The latest Australian research shows one in four stonemasons will develop this debilitating, often fatal and completely preventable disease, and its resurgence is directly related to the popularity of engineered stone, a fashion product.”</p><p>There is also a concern that not all workers understand the risks of contracting silicosis.</p><p>“Our research shows almost 40 per cent of Aussie tradies do not think silica dust exposure is a serious concern to their health, and one in two do not know there is no safe level of silica dust exposure,” Early says.</p><h2>The call for a ban</h2><p><br>The campaign for a ban has had support from all across the construction and property industry including the industry’s union, the CFMEU.</p><p>During the past year it has led protests in several states on the issue.</p><p>It said action was needed by federal, and state and territory governments.</p><p>“I’d hate to see any federal, state or territory government abrogate responsibility on engineered stone,” CFMEU national secretary Zach Smith says.</p><p>“It’s simply not true to say the power to ban engineered stone solely rests with the states.</p><p>“Banning killer stone from entering the country is 100 per cent a federal responsibility.”&nbsp;</p><p>The federal government is able to ban engineered stone imports and pass work health and safety laws to guide states and territories.</p><p>State and territory governments can ban the product by directly changing their work health and safety legislation.&nbsp;</p><p>So far Victoria, South Australia, New South Wales, Queensland, Tasmania and Western Australia have <a data-mce-href="https://www.theurbandeveloper.com/articles/stone-ban-silicosis-australia-workers-safety" href="https://www.theurbandeveloper.com/articles/stone-ban-silicosis-australia-workers-safety" target="_blank" rel="noopener">committed to banning engineered stone</a> if the federal government does not implement that national ban.&nbsp;</p><p>Smith likens the situation to the asbestos issue.</p><p>“Border Force’s list of prohibited goods has asbestos on it, so why doesn’t the federal government put engineered stone on it too?” Smith asks.</p><div id="4dTjfNldmHrftWz6P6HHBU"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3Y65FipAqAh2UlatqRYaD/163b171ae22c608eeabe73dac2fe720a/3.jpg" alt="Several infrastructure projects including renewable energy projects were approved and started up during Daniel Andrews' three terms as Victorian premier." data-mce-src="//images.ctfassets.net/8pr762qjocl3/3Y65FipAqAh2UlatqRYaD/163b171ae22c608eeabe73dac2fe720a/3.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Former Victorian premier Daniel Andrews announced new regulations around uncontrolled dry cutting of engineered stone in Victoria in 2019.<br><br></span></div></div><p>In August this year, Safe Work Australia released its report, <em>Decision Regulation Impact Statement: Prohibition on the use of engineered stone,</em> with recommendations to the federal, state and territory work health and safety ministers for banning engineered stone use.&nbsp;</p><p>The report’s process included consultation, independent economic analysis and experts reviewing evidence.</p><p>“This report is a vital piece of work which has highlighted how widespread, dangerous and under-diagnosed the issue of silicosis is in Australia,” Early says.</p><p>“The focus must now be on commencing an importation ban on the use of engineered stone products, and ensuring there is nationally consistent legislation for the monitoring and health surveillance of workers exposed to silica dust across all affected industries.”</p><h2>The law today</h2><p><br>Some changes are already in effect.</p><p>The Labor government under Daniel Andrews in September, 2019 introduced new regulations in Victoria preventing the uncontrolled dry cutting of engineered stone.</p><p>It placed the responsibility for ensuring that on-tool water suppression or dust extraction devices and respiratory protection was in place on the employers.&nbsp;&nbsp;</p><p>The hope was that it would significantly reduce workers’ exposure to the crystalline silica dust and reduce the chance of silicosis.</p><p>Andrews’ announcement also included free health screenings for Victoria’s 1400 stonemasons and an inspection blitz to ensure high-risk workplaces were compliant.&nbsp;</p><p>The Queensland government implemented a code of practice for the engineered stone industry in 2019 and a code of practice for silica in the construction industry in May.</p><p>It also created a Dust Lung Disease register, allocated $5 million for dust lung research, screened more than 1000 workers and audited all known engineered stone benchtop fabricators.&nbsp;</p><p><strong>Estimated costs per prohibition option per group</strong></p><table border="0" data-mce-style="width: 100%; font-family: Panton-Bold, Helvetica, Arial, sans-serif; font-size: 14px; color: rgba(0, 0, 0, 0.87); border: unset; height: 380.5px; float: left;" style="width: 100%; font-family: Panton-Bold, Helvetica, Arial, sans-serif; font-size: 14px; color: rgba(0, 0, 0, 0.87); border: unset; height: 380.5px; float: left;" class="mce-item-table"><tbody><tr style="height: 80.5px;" data-mce-style="height: 80.5px;"><td style="width: 24.8087%; height: 80.5px;" data-mce-style="width: 24.8087%; height: 80.5px;">Criterion&nbsp; &nbsp;&nbsp;</td><td style="width: 25.1883%; height: 80.5px;" data-mce-style="width: 25.1883%; height: 80.5px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">Option 1 (millions)</span><br></td><td style="width: 25.1883%; height: 80.5px;" data-mce-style="width: 25.1883%; height: 80.5px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">Option 2 (millions)</span><br></td><td style="width: 24.8147%; height: 80.5px;" data-mce-style="width: 24.8147%; height: 80.5px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">&nbsp;Option 3 (millions)</span><br></td></tr><tr style="height: 81px;" data-mce-style="height: 81px;"><td style="width: 24.8087%; height: 81px;" data-mce-style="width: 24.8087%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">Cost to businesses</span><br></td><td style="width: 25.1883%; height: 81px;" data-mce-style="width: 25.1883%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$139.9</span><br></td><td style="width: 25.1883%; height: 81px;" data-mce-style="width: 25.1883%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$133.0</span><br></td><td style="width: 24.8147%; height: 81px;" data-mce-style="width: 24.8147%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$137.1&nbsp;</span><br></td></tr><tr style="height: 81px;" data-mce-style="height: 81px;"><td style="width: 24.8087%; height: 81px;" data-mce-style="width: 24.8087%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">Cost to government</span><br></td><td style="width: 25.1883%; height: 81px;" data-mce-style="width: 25.1883%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$108.2&nbsp;</span><br></td><td style="width: 25.1883%; height: 81px;" data-mce-style="width: 25.1883%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">&nbsp;$107.5&nbsp;</span><br></td><td style="width: 24.8147%; height: 81px;" data-mce-style="width: 24.8147%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$111.1&nbsp;</span><br></td></tr><tr style="height: 81px;" data-mce-style="height: 81px;"><td style="width: 24.8087%; height: 81px;" data-mce-style="width: 24.8087%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">Costs to workers&nbsp; &nbsp; &nbsp;</span><br></td><td style="width: 25.1883%; height: 81px;" data-mce-style="width: 25.1883%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$3.1</span><br></td><td style="width: 25.1883%; height: 81px;" data-mce-style="width: 25.1883%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">&nbsp;$0.0</span><br></td><td style="width: 24.8147%; height: 81px;" data-mce-style="width: 24.8147%; height: 81px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">$1.5</span></td></tr><tr style="height: 57px;" data-mce-style="height: 57px;"><td style="width: 24.8087%; height: 57px;" data-mce-style="width: 24.8087%; height: 57px;"><span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;">Total</span><br></td><td style="width: 25.1883%; height: 57px;" data-mce-style="width: 25.1883%; height: 57px;">$251.1&nbsp;<span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;"><br></span></td><td style="width: 25.1883%; height: 57px;" data-mce-style="width: 25.1883%; height: 57px;">$240.5<span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;"><br></span></td><td style="width: 24.8147%; height: 57px;" data-mce-style="width: 24.8147%; height: 57px;">$249.7<span style="letter-spacing: 0.14994px;" data-mce-style="letter-spacing: 0.14994px;"><br></span></td></tr></tbody></table><p><sub>Source: <em>Decision Regulation Impact Statement: Prohibition on the use of engineered stone,</em> Safe Work Australia, 2023.&nbsp;<br></sub><br></p><p>When Western Australia’s Cook government announced it would back the ban it also included that WorkSafe WA was reporting 48 cases of silicosis since 2018 in WA—43 of them were workers in the engineered stone industry.&nbsp;</p><p>“The rate of silicosis, a serious and potentially fatal disease, in WA is unacceptable,” the state industrial relations minister Bill Johnston says.</p><p>Meanwhile, major retailers such as Bunnings Warehouse and IKEA have announced plans to phase out sales of engineered stone products.&nbsp;</p><h2>Potential consequences</h2><p><br>However, there are concerns about <a data-mce-href="https://www.theurbandeveloper.com/articles/silicosis-developers-manufactured-stone-ban" href="https://www.theurbandeveloper.com/articles/silicosis-developers-manufactured-stone-ban" target="_blank" rel="noopener">the economic consequences of a ban on the property industry</a>.</p><p>Altus Group’s <em>Australian construction material price outlook </em>report for the third quarter of 2023 flagged that the ban could lead to cost increases.&nbsp;</p><p>“Engineered or composite stone is considerably cheaper than natural alternatives, such as Corian, natural stone products, or marble,” the report says.</p><p>“The consequence is, therefore, not a material price increase but a specification change which will lead to large cost increases.”&nbsp;</p><p>Safe Work Australia in its August report proposed three options: A complete ban on all engineered stone, a ban on all engineered stone with more than 40 per cent silica or a ban on all engineered stone with more than 40 per cent silica but with a licensing framework for anything with less than 40 per cent silica.</p><p>Estimating the value of a human life at $4.9 million, it estimated that only 40 to 50 cases of silicosis would need to be prevented to offset the cost of each option.</p><p>It ultimately recommended that the best option was a complete ban on engineered stone.</p><p>“The only way to ensure that another generation of Australian workers do not contract silicosis from such work is to prohibit its use, regardless of its silica content,” the Safe Work Australia report says.</p><p>“The cost to industry, while real and relevant, cannot outweigh the significant costs to Australian workers, their families and the broader community that result from exposure to RCS [respirable crystalline silica] from engineered stone.”</p><p>If a complete ban were implemented then, as with asbestos, there would be some exceptions granted for when previously installed engineered stone needed to be removed or maintained.</p><div id="6iAMKsA0XNvomx4Mv25NYT"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5Hs6yvJir7WsjRvCz7yWqL/a658e3c6a78778a282c1f8e2b58faf0f/iStock-1466632678.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5Hs6yvJir7WsjRvCz7yWqL/a658e3c6a78778a282c1f8e2b58faf0f/iStock-1466632678.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The use of natural alternatives, such as marble, will mean a cost increase.<br><br></span></div></div><p>Safe Work Australia also estimates there were 750 to 1250 businesses manufacturing engineered stone and 179,750 working with legacy engineered stone products in some capacity.</p><p>That would mean not only job losses and possible retraining for workers due to a ban but also income loss for businesses.</p><p>However, the report also stated that it would mean businesses would avoid compensation claims.&nbsp;</p><p>Estimated costs for businesses were $139.9 million during the appraisal period for the first option, $133 million for the second option and $137.1 million for the third.</p><p>Those costs for workers were $3.1 million, no costs and $1.5 million respectively, while for the government the estimated costs were $108.2 million, $107.5 million and $111.1 million respectively.</p><p>For those businesses specifically manufacturing engineered stone, it was estimated that during a 10-year appraisal period, there would be a total loss of $6.9 million.&nbsp;</p><p>But of the businesses that contributed to the consultation report, 95 per cent indicated that they would be able to easily swap to natural stone options.&nbsp;</p><p>What happens next may be revealed as early at this month, when the nation’s Work Health and Safety ministers are due to meet.&nbsp;<br><br></p><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>

 A long run campaign to ban engineered stone due to silicosis concerns could be hitting its final strides as state governments make key commitments…

[+] vic land laws WEB.jpg

<p>The Victorian government’s decision to increase taxes on vacant residential land and empty houses will force developers to look to other states for business, industry leaders have warned.</p><p>Developers, builders, economists and lobby groups all say the new tax—which could, according to estimations, add an additional $37 million into state coffers—is unlikely to make much difference to Victoria’s critical housing shortage.</p><p>The planned tax increase was first mooted last month when, in a surprise to the industry, Victorian treasurer Tim Pallas announced he was expanding the 1 per cent tax on vacant homes to include the whole state, rather than only Melbourne’s inner and middle neighbourhoods.</p><p>“We know the best thing you can do to make homes more affordable is supply more of them,” Pallas said at the time.&nbsp;&nbsp;</p><p>“This is all about freeing up empty houses for rent and vacant land for new homes, particularly across the outer suburbs and regional Victoria.”</p><p>But after a deal was struck this week between Jacinta Allan’s government and the Greens Party, the tax rate on vacant property will rise from 1 per cent of the vacant property’s total improved value to 2 per cent in the second consecutive year.</p><p>The tax will increase to 3 per cent in the third year.</p><p>Samuel Property managing director Illan Samuel accuses the government of failing to understand the industry.</p><p>“We can’t change the market fundamentals … that is a major misalignment the government has at the moment,” he says.</p><p>“We are sitting on land and opportunities because we have a choice.</p><p>“Racehorses race and developers develop. We like to get things done, we are not shy of risks or taking things on but if the market fundamentals are not there—be those construction costs, infrastructure, finance requirements, the ability to get sales, or red tape and planning restrictions—all you can really often do is wait for the next cycle.</p><div id="3wAwWIV3LrmUgIamsqCLDg"><picture><img src="//images.ctfassets.net/8pr762qjocl3/Gy9mRHIQhRRR98XPm8W70/b534616cff64072a4d7403689c4db2b7/3.jpg" alt="Newly built homes will also escape the tax for three years if owners can show they made genuine attempts to sell " data-mce-src="//images.ctfassets.net/8pr762qjocl3/Gy9mRHIQhRRR98XPm8W70/b534616cff64072a4d7403689c4db2b7/3.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Newly built homes will escape the tax for three years if owners can show they made genuine attempts to sell.</span></div><div><br></div></div><p>“I think that’s what anybody who’s sitting on vacant land is doing,” he says. “But to tax them under the guise we are somehow restricting supply on purpose?”</p><p>When the treasurer announced the tax changes in October, the Victorian branch of the Property Council of Australia took the industry’s biggest concerns directly to the government.</p><p>The PCA says it was able to wrangle concessions to the Bill, including protections for existing holiday homeowners regardless of ownership structure.</p><p>Now, under the tax scheme, the government says it will extend an exemption for holiday homes occupied by owners for more than four weeks a year to include use by immediate family members.</p><p>Newly built homes will also escape the tax for three years if owners can show they made genuine attempts to sell at, or below, the price they expected when construction started.</p><p>Still, the PCA is far from happy with the announcement.</p><p>Victorian executive director Cath Evans says the council does not believe new or expanded taxes will build the new homes that the state desperately needs.</p><p>“Victoria already has the heaviest property tax burden of any state in the nation,” Evans says.</p><div id="5nXC11ddP1PamjBlyys2Vw"><picture><img src="//images.ctfassets.net/8pr762qjocl3/e7ZOc1yWLPTi2aszMAHxK/8bb190de057025b3dc7cc1b4f162720a/2.jpg" alt="The Property Council says Victoria already has the heaviest property tax burden of any state in the country." data-mce-src="//images.ctfassets.net/8pr762qjocl3/e7ZOc1yWLPTi2aszMAHxK/8bb190de057025b3dc7cc1b4f162720a/2.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The property council says Victoria already has the heaviest property tax burden of any state in the country.</span></div><div><br></div></div><p>“The reality is that this is creating an economic environment where Victorian businesses are struggling to attract capital investment to our state—jeopardising the capacity for our industry to build more homes.</p><p>“We encourage the Victorian government to focus its attention on delivering policy outcomes that incentivise the construction of new homes, reduce the burden on business and allow the property industry to get on with delivering the housing supply that Victorians need and expect.”</p><p>Samuel echoes that sentiment.</p><p>“What the government could do is actually try to stimulate demand by incentivising activity rather than penalising those that are perceived to control supply.”</p><p>Like Samuel, Wel.Co founder and managing director Andrew Welsh has long criticised the&nbsp;<a href="https://www.theurbandeveloper.com/articles/victoria-planning-dilemma-solutions" data-mce-href="https://www.theurbandeveloper.com/articles/victoria-planning-dilemma-solutions">Victorian government’s approach to planning&nbsp;</a>and development. For him, the increased taxes are another nail in the coffin.</p><p>“They’re trying to solve issues with taxes rather than getting to the real source of the problems,” Welsh says.</p><p>“In my view, the majority of housing supply is being held up and being caught up in red tape and the approvals process.”</p><p>Wel.Co is a Melbourne-based developer specialising in building communities. Its bread and butter has been Melbourne’s Growth Corridor Plans—the Victorian capital’s integrated land use and transport schemes which will decide the region’s growth in the coming decades.</p><div id="5ZRCBxT5OcpbbtGWTYSr0S"><picture><img src="//images.ctfassets.net/8pr762qjocl3/4TsWUe0wE1chg1Nxmkov6K/31c68bba8f5163131a93a6a58de58c18/1.jpg" alt="Kyle Wathen, Cath Evans, Illan Samuel and Andrew Welsh.  All agree the tax increase will have little effect on housing supply." data-mce-src="//images.ctfassets.net/8pr762qjocl3/4TsWUe0wE1chg1Nxmkov6K/31c68bba8f5163131a93a6a58de58c18/1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Kyle Wathen, Cath Evans, Illan Samuel and Andrew Welsh. All agree the tax increase will have little effect on housing supply.</span></div><div><br></div></div><p>But Welsh says they’ve struggled to find value in Melbourne’s growth corridors during the past couple of years.</p><p>“There are large tracts of developable land in growth corridors that could be unlocked for housing,” he says, “but Melbourne Water, the local councils are not providing the approvals as fast as they should be.</p><p>“I know numerous vendors that would develop their properties if they could, but they can't because the authorities are holding up approvals or not enacting their powers to allow development to happen,” he says.</p><p>“Now they will be hit with this tax.”</p><p>Kyle Wathen advises on property and construction for chartered accountants William Buck.</p><p>He says that for developers, the new rates could mean an additional land tax bill of $200,000 a year for a property with a Capital Improved Value (CIV) of $20 million.</p><p>For a residential property investor with an asset of $1 million, it will add $10,000 each year.</p><p>“I just can’t see this being the golden key to unlocking housing supply, which right now, that’s where the bottleneck is,” Wathen says. “It’s the supply issue.”</p><p>“The amount of new taxes around [the] property market that have come in the last calendar year alone is quite incredible,” he says. “Even if the numbers do happen to stack up now, there’s still that uncertainty as to what Big Government is going to do in the future.</p><div id="3qbGvTfeKliXxk06vLm9pq"><picture><img src="//images.ctfassets.net/8pr762qjocl3/2eAwUl6DU5tSiDD7dSlOzt/37446a59d0a9d3ffcafd00c7a8f86213/4.jpg" alt="Exemptions may be made for land not currently under an application or request if there is proof of efforts being made to prepare it for development." data-mce-src="//images.ctfassets.net/8pr762qjocl3/2eAwUl6DU5tSiDD7dSlOzt/37446a59d0a9d3ffcafd00c7a8f86213/4.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Exemptions may be made for land not currently under an application or request if there is proof of efforts being made to prepare it for development.</span></div><div><br></div></div><p>“Because it takes a few years to get these things out of the ground.”</p><p>Wathen believes Victorian developers will start looking to other states.</p><p>Welsh says it is already happening.</p><p>“We see it every day, and more and more,” he says.</p><p>“We’ve seen a huge amount of developers move into the Queensland and South Australian markets over recent years.</p><p>“It’s not just developers, we’re seeing engineers, sales agents, marketing companies, civil contractors … we’re seeing a lot of businesses that have been home-based in Victoria, move into these other markets because there is more stability around what planning is or isn’t going to happen.”</p><p>Samuel agrees.</p><p>“It just says even more that perhaps Victoria is closed for business because it makes it harder for people to get things to work.”<br>&nbsp;</p><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>

The decision to increase taxes on vacant land and empty houses will force developers out of Victoria, industry leaders have warned…

[+] tud plus hero for web (5).jpg

<p>Adorned with a vertical forest of about 1000 trees as well as other shrubbery, it was mooted to become the world’s greenest residential tower.</p><p>But not even an unsolicited endorsement from renowned environmentalist Sir David Attenborough on social media was enough to prevent Aria Property Group’s proposed “Urban Forest” high-rise being chopped down.</p><p>Or so it seemed.</p><p>A little more than 18 months since a NIMBY (not-in-my-backyard) army of inner-city residents wielded their collective axe and <a href="https://www.theurbandeveloper.com/articles/aria-s-urban-forest-plans-scrapped-after-court-appeal" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/aria-s-urban-forest-plans-scrapped-after-court-appeal">kiboshed the project after filing an appeal in the Planning and Environment Court against its approval</a>, the South Brisbane tower proposal has been resurrected.</p><p>Aria has submitted updated plans with the Brisbane City Council for its ambitious and innovative tree-covered “highly liveable ventilated tower”.</p><p>Designed by internationally acclaimed architect Koichi Takada, it represents a transformative approach to green living with groundbreaking initiatves realised through dense landscaping and energy efficiency.</p><p>The development application takes the proposal back up to 30 storeys, its <a href="https://www.theurbandeveloper.com/articles/aria-cultivates-urban-forest-tower-plans" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/aria-cultivates-urban-forest-tower-plans">original height when first lodged in July, 2020</a>.</p><p>By the time council approval was initially granted in November, 2021 it had been scaled back to 20 storeys—not only significantly trimming its apartment yield by almost half but also its vertical forest to about 500 trees.</p><p>According to Aria, the newly filed $300-million tower plans are greener with “a greater abundance of trees and vegetation and community enhancing features”.</p><p>Overall, it incorporates 827 trees and more than 27,000 other plants covering 200 per cent of the site area—equivalent to 5600sq m—with 251 plant species.</p><div id="37LBcn8JN34NxQL3jBPmqq"><picture><img src="//images.ctfassets.net/8pr762qjocl3/6Z3OfA21cKim0xTkyz1Pco/0dcf89000fc801ce4313533ea8029b37/Aria_Glenelg_MID2.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/6Z3OfA21cKim0xTkyz1Pco/0dcf89000fc801ce4313533ea8029b37/Aria_Glenelg_MID2.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Aria’s Urban Forest takes learnings from the developer’s other inner-city projects and the groundbreaking Bosco Verticale in Milan.<br><br></span></div></div><p>A total of 321 apartments—including 39 one-bedroom, 94 two-bedroom, 108 three-bedroom, 74 four-bedroom and 6 five-bedroom units—will sit above seven basement levels with more than 450 carparks.</p><p>Three sub-penthouse levels from floors 26 to 28 and a penthouse on level 29 will top the residential component.</p><p>The tower’s design also features 3000sq m of communal facilities, including a 1554sq m rooftop recreation area.</p><p>As well, it integrates a 1452sq m publicly accessible park under the building—echoing Aria’s nearby Fish Lane Town Square development—with a stage, outdoor classrooms, amphitheatre and event space, information hub and a floating canopy bridge.</p><h2>World’s greenest residential building</h2><p><br>“We always wanted to do something pretty bold and pretty big and we felt that Brisbane was ready for a building that was going to be arguably one of, if not, the most sustainable and greenest residential buildings in the world,” Aria’s development director Michael Hurley told <em>The Urban Developer</em>.</p><p>“So that was always our goal. That was always our intent. Obviously, however, life sometimes throws a few curveballs and there has been a lot that has happened in 3½ years.</p><p>“But it has never once dampened our motivation or desire for what we believe is a long-term trend towards clean, green and sustainable buildings that is only going to get bigger and bigger.”</p><p>Hurley says the concept of the Urban Forest tower was inspired by exemplar green buildings around the world.</p><p>In particular, the Bosco Verticale in Italy as well as Singapore’s cutting-edge green buildings such as Parkroyal on Pickering.</p><p>And he says with its vision for the 2784sq m site spanning 23-25 Glenelg Street and 82 Merivale Street in South Brisbane, Aria aims to “achieve similar architectural excellence for Brisbane as a sub-tropical city”.</p><div id="5n3QgO0QZyZXVDoVVJ4cK9"><picture><img src="//images.ctfassets.net/8pr762qjocl3/4dxUl7oyoOL0wWYxLFrW2l/cf9702f04fd525e247063a745f733abc/1.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/4dxUl7oyoOL0wWYxLFrW2l/cf9702f04fd525e247063a745f733abc/1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Stefano Boeri Architetti’s Bosco Verticale, a two-tower vertical forest prototype in Milan.<br><br></span></div></div><p>Shortly after the initial DA was lodged in 2020, the project was thrust into the global spotlight when British broadcaster, biologist and environmentalist Sir David Attenborough gave it the thumbs up by sharing a render of the tower design on his Facebook page.</p><p>Hurley describes the moment as “very humbling … yeah, pretty cool”.</p><p>But in May, 2022, Aria scrapped the project and pursued a 12-storey healthcare scheme in its place after the West End Community Association filed an appeal in the Planning and Environment Court against the scaled-back development’s approval.</p><h2>Policy landscape change paves way</h2><p><br>At the time, Hurley said the objections against the Urban Forest proposal coupled with an overheated construction market had conspired against it, making it unfeasible.</p><p>In recent times, however, green shoots from a fertile post-pandemic development landscape—driven by a critical housing undersupply, forecast population growth and government policy changes—have emerged, prompting Aria to revisit the project.</p><p>“We were going to move forward with the project a few years ago but for whatever reason things happened and we weren't able to do that,” Hurley says. “But now the time is potentially right.”</p><div id="75jY5N9iORE8mO7tzjCIWX"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5rwFhOwxLfT4wx0U20NpR7/ae6e1a58958af41956d54c9350cf09fb/GlenelgSt.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5rwFhOwxLfT4wx0U20NpR7/ae6e1a58958af41956d54c9350cf09fb/GlenelgSt.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Aria lodged plans for a medical building comprising 15,642sq m of net lettable area.<br><br></span></div></div><p>The Kurilpa Sustainable Growth Precinct Plan temporary local planning instrument (TLPI)—encompassing South Brisbane and West End—was passed in council in June and recently gazetted by the Queensland government.</p><p>It paves the way for CBD-style height limits for residential buildings in the area in a bid to accommodate the additional 500,000 residents predicted to call the Queensland capital home by 2046.</p><p>Any new applications lodged for taller developments within the precinct must meet green design and community benefit standards.</p><p>“We were obviously waiting and watching as the TLPI worked through the process and once it got signed off we went, ‘Okay, lets start working on it again’. We had the confidence to continue to move forward with the project,” Hurley says.</p><p>In the meantime, Aria has added three residential towers to Brisbane’s skyline in 2023—Upper House and Trellis in South Brisbane and Riviere at Kangaroo Point. Each tower features sustainable design, including EV ready carparks and car chargers and an array of solar panels.</p><p>“This is not a fleeting thing,” he says. “This is something that's part of our DNA and we've committed to as a company.”</p><p>The recently-completed 32-storey Upper House is South Brisbane's tallest building and Queensland's first standalone five-star Green Star residential building.</p><div id="7b6dVbQtdpP2t46Ijk7i1S"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5BUFQGb0eVTF7mjlOPgtou/f7b67132a27e0b2e0323982f63abe8ec/Aria_Glenelg_MID1.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5BUFQGb0eVTF7mjlOPgtou/f7b67132a27e0b2e0323982f63abe8ec/Aria_Glenelg_MID1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Urban Forest is being touted as one of the greenest residential buildings in the world.<br><br></span></div></div><h2>Green legacy in focus ahead of Games</h2><p><br>“As we head towards the 2032 Olympics, Brisbane should be embracing more green and sustainable towers that will put our city on an international standing,” Hurley says.</p><p>Brisbane’s 2032 Olympics will be the first Games contractually obliged to operate as “climate positive” and the city's Lord Mayor Adrian Schrinner has committed to creating “a greener and more liveable city” leading up to hosting the world's biggest sports event.</p><p>“It’s pretty simple, really,” Hurley says. “When they have the opening ceremony or the closing ceremony and they’re casting the cameras across Brisbane … do we want to see a sea of concrete and glass? Or do we want to see a sea of green sustainable tree-covered buildings?</p><p>“In time, we want Brisbane to be mentioned in the same breath as Singapore as a global leader in green buildings and sustainability.</p><p>“Urban Forest is that next step. It aims to reduce the urban heat effect, setting a new Australian benchmark for sustainability.</p><p>“And we've put an additional 3½ years of experience, IP, innovation, knowledge and design into upgrading what might appear on the surface to be a very similar building.<br></p><p>&nbsp;“But there are probably 100 things that we've done that are not visible from the outside and this is going to be a pretty significant building—not only for Brisbane but Australia.</p><p>“It’s a big leap. It isn’t a small one. And we’ve been working towards this for a decade and we feel ready.”<br><br></p><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>

The developer has filed fresh plans for a $300-million South Bank tower that was laid low by a community group’s protests last year… 

Canberra Hero PLUS Nov 28.jpg

<p>The Australian Capital Territory, land-locked by New South Wales and wrapped around the national capital Canberra, is starting to feel every bit of its 112 years.</p><p>At 2280sq km, the ACT is slightly smaller than Luxembourg.</p><p>But with an estimated resident population of 464,601 in March—twice what it was 40 years ago—the territory and the capital are having a fresh look at development.</p><p>They have to. The Australian Bureau of Statistics says by 2050 Canberra will add somewhere between 170,000 and 295,000 new residents.</p><p>“We have determined that we need to deliver 100,000 new dwellings to meet our population demand by 2050,” says the man currently responsible for making sure it all happens.</p><p>Ben Ponton has been the ACT’s chief planner since 2017.</p><p>And no, he says, the ACT is not running out of land. Or, at least, not immediately.</p><p>“But probably within the next 15 to 20 years,” he says. “There is only so much land and this is a real issue for the ACT.”</p><div id="1NehfHkZmB6wjDQu5kWtKc"><picture><img src="//images.ctfassets.net/8pr762qjocl3/6lleN73L9AVaANnzgJaSed/0815a9ad9d12b49f1fb7e2a26cf31128/Wayfarer_Mid_1.jpg" alt="Geocon’s Wayfarer residential tower—at the time off construction it was Canberra's tallest apartment building." data-mce-src="//images.ctfassets.net/8pr762qjocl3/6lleN73L9AVaANnzgJaSed/0815a9ad9d12b49f1fb7e2a26cf31128/Wayfarer_Mid_1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Geocon’s Wayfarer residential tower—at the time of construction it was Canberra's tallest apartment building.</span></div><div><br></div></div><p>In fact, in April of 2018 construction began on the first stage of what is called Ginninderry, a 30-year project, which aims to house 30,000 people in 11,500 new homes.</p><p>The 1600-ha development—a 60-40 joint venture between the ACT government and Corkhill Brothers subsidiary Riverview Developments—is 13km north-west of Civic in Canberra’s centre. It begins in West Belconnen, just beyond the suburbs of Holt and Macgregor…and then crosses the ACT-NSW border.</p><p>It’s the first cross-border development in Canberra’s history.</p><p>“The future of greenfield land development for the ACT is almost certainly going to be on the other side of the border,” Canberra resident and a director at Purdon Planning Dan Stewart told&nbsp;T<em>he Urban Developer.</em></p><p>Stewart says Canberrans are often choosing to cross the border into NSW for somewhere to live.</p><p>“They can probably get more bang for their buck in terms of buying power,” he says.</p><p>“And they can certainly get the lifestyle benefits of larger blocks, small hobby farms and the sort of rural residential lifestyle that a lot of people are quite happy to take.”</p><p>He points to areas just outside the ACT such as Yass and Murrumbateman to the north, Bungendore to the west, and Royalla and Jerrabomberra, to the south and south-east.</p><p>“My view is those areas have all sprung up in large part because of the demand from the ACT for lifestyle, for value and for a bit more space,” he says.</p><div id="JZp3pHEuhtiK41I3n1mw7"><picture><img src="//images.ctfassets.net/8pr762qjocl3/2mcNI4UoscAlESlSsk5GW9/850c11efa9b5d1d8aa8e3bb92c8ebab3/Light_Rail__Mid_2.jpg" alt="Canberra's light rail opened in 2019.  Planners are encouraging high density development along its path." data-mce-src="//images.ctfassets.net/8pr762qjocl3/2mcNI4UoscAlESlSsk5GW9/850c11efa9b5d1d8aa8e3bb92c8ebab3/Light_Rail__Mid_2.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Canberra's light rail opened in 2019. Planners are encouraging high-density development along its path.</span></div><div><br></div></div><p>By most reports, both the NSW and the Territory governments have been willing to negotiate over what amounts to a “land grab” by Canberra.</p><p>Many NSW residents work in the national capital but the cash-strapped regional councils where they live struggle to provide essential services such as roads, rubbish collection and water for the growing population.</p><p>While for its part, Canberra has its own issues with providing services to the outskirts of the Territory. Services, such as public transport.</p><p>In 1913 Sir Walter Burley Griffin beat out 137 other designers for the privilege of designing a bush capital. His plan was predicated on a high-density centre with wide avenues to allow for mass transit. He wanted trams.</p><p>It would be 106 years before Canberra got the first stage of a light rail link—an initial 12km and 14 stops linking the northern town centre of&nbsp;Gungahlin&nbsp;to Civic.</p><p>Stage Two—another 11km with 12 stops between Canberra and Woden in the southern suburbs—will finish sometime next year. The federal government is committing $218 million. The Territory about $61 million.</p><p>The pressure on planners as well as developers for more density, closer to the city has been considerable.</p><p>Chief planner Ponton says a major planning shift came in 2018.</p><p>Before that the government had encouraged a 50-50 split. That is, half infill and half greenfield sites.</p><div id="1RG9x80m3yjdNibj5EPGeR"><picture><img src="//images.ctfassets.net/8pr762qjocl3/2uqZmsnUcG4V6LAuxrvHFV/7cc00954fba1cb0a34eeb8f9541df154/Canberra_Population_Mid__800_x_387_.jpg" alt="The Australian Bureau of Statistics says Canberra's population will grown to between 550.000 and 760,000 by 2050." data-mce-src="//images.ctfassets.net/8pr762qjocl3/2uqZmsnUcG4V6LAuxrvHFV/7cc00954fba1cb0a34eeb8f9541df154/Canberra_Population_Mid__800_x_387_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Australian Bureau of Statistics says Canberra's population will grow to between 550.000 and 760,000 by 2050.</span></div><div><br></div></div><p>“But the 2018 planning strategy took the approach of developing a compact and efficient city,” says Ponton. “So, compact in terms of density and efficient in terms of infrastructure and servicing.”</p><p>Today, like major cities along Australia’s eastern seaboard, the planners want 70 per cent of Canberra’s growth to be within the existing urban footprint. Only 30 per cent will be greenfield development.</p><p>“And I wouldn’t be surprised if in the next iteration of the planning strategy—but that’s not for five years—we might see that ratio changing even further, to be more favourable to more infill development.”</p><p>Developers have been quick to pounce on the new strategy, with major residential developments springing up in established neighbourhoods, in part driven by proximity to Canberra’s light rail.</p><p>In July this year Liebke and Co—a Canberra-based and family real estate and property investment firm—<a href="https://www.theurbandeveloper.com/articles/canberra-braddon-liedke-co-mixed-use-tower" data-mce-href="https://www.theurbandeveloper.com/articles/canberra-braddon-liedke-co-mixed-use-tower">filed plans for 100 apartments</a> in an eight-storey tower at 90 Northbourne Avenue, Braddon.</p><p>It was the first time the site had changed hands in 50 years.</p><p>“We’re seeing a slower rate of greenfield land release and in parallel to that the government is actively encouraging brownfield development, which is where you’ve seen all those big apartment buildings coming up,” Purdon Planning’s Stewart says.</p><p>Belconnen has seen the most significant infill of any of the town centres.</p><p>Just this month, JWLand—also a Canberra-based developer—<a href="https://www.theurbandeveloper.com/articles/jwland-canberra-act-precinct-plan" data-mce-href="https://www.theurbandeveloper.com/articles/jwland-canberra-act-precinct-plan">unveiled concept plans&nbsp;</a>for a $400-million mixed-use precinct at Belconnen, including a 19-storey residential tower with 436 apartments.</p><div id="2JOlAYO8NmmnTxlpkjgYZn"><picture><img src="//images.ctfassets.net/8pr762qjocl3/16zMgOyFUaylKV5rG2kriP/3515be91a72a1c972695cc6b546280ec/Doma_s_Melrose_Mid_4__Long_.jpg" alt="Doma's Melrose residential development in Woden." data-mce-src="//images.ctfassets.net/8pr762qjocl3/16zMgOyFUaylKV5rG2kriP/3515be91a72a1c972695cc6b546280ec/Doma_s_Melrose_Mid_4__Long_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Doma’s Melrose residential development at Woden.</span></div><div><br></div></div><p>And a real estate funds manager is eyeing a&nbsp;<a href="https://www.theurbandeveloper.com/articles/canberra-belconnen-hotel-build-to-rent" data-mce-href="https://www.theurbandeveloper.com/articles/canberra-belconnen-hotel-build-to-rent">hotel and build-to-rent project</a>, also at Belconnen, which will include 300 apartments and a 50-key hotel.</p><p>Elanor Investors reportedly snapped up Belconnen Markets, now known as Capital Food Market, a carpark and vacant development site for $44 million in 2018.</p><p>“There’s no doubt in the last 10 years we’ve seen building heights, apartment buildings, going from around 10 storeys, to where we’re now routinely seeing 15 to 20 storeys and quite a few 20-plus as well,” Stewart says.</p><p>“And the government’s been very considered in where it’s willing to support the height and what that support looks like.”</p><p>That’s been a deliberate policy by the Territory’s planners.</p><p>Four years’ work culminated this week, when the government’s so-called new Territory Plan went into effect, with new design guidelines aimed at encouraging higher density closer to city centres.</p><p>In some residential zones, for example, dual-occupancy developments will be allowed on bigger blocks.</p><p>Minister for Planning and Land Management Mick Gentleman said the new planning documents had come about after a lengthy consultation process with the community and the industry.</p><p>“We listened to and considered all the feedback we received, and these documents strike the balance with the range of views we’ve heard across Canberra, best practice and planning for growth and sustainability,” he said.</p><div id="zRa5sM0MCb3E0iuE5oP0G"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1UfaJaKB0DVXi15nF6R8qx/07e80785d7c33de13ede66cbcd212109/Suburban_Mid_5_.jpg" alt="The ACT's new planning strategy will allow dual-occupancy developments on bigger blocks in some Canberra suburbs.
" data-mce-src="//images.ctfassets.net/8pr762qjocl3/1UfaJaKB0DVXi15nF6R8qx/07e80785d7c33de13ede66cbcd212109/Suburban_Mid_5_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The ACT's new planning strategy will allow dual-occupancy developments on bigger blocks in some Canberra suburbs.</span></div><div><br></div></div><p>“We have listened to feedback and concerns regarding new housing— particularly infill developments.”</p><p>Ponton agrees there has “been a focus in the last few years on very high density development”, although a lot of impetus has come from the developers themselves.</p><p>Geocon, Canberra’s biggest developer, has finished a number of major projects in recent years, including Metropol in Canberra City in September, 2021, comprising 552 apartments across three buildings.</p><p>Its biggest mixed-use project to date is the Republic Precinct in Belconnen with five buildings and more than 1200 apartments.</p><p>And, at the time of its construction, Geocon’s $125-million Wayfarer tower—with 331 apartments and also at Belconnen—was the tallest residential apartment building in Canberra.</p><p>Ponton says a key feature of the work they’ve been doing over the past four years has been to make sure they have the systems in place and the work program clearly identified to allow developers to do their job.</p><p>“We wanted to make sure that we’re able to deliver, or assist the industry to deliver, on that need for 100,000 additional houses by 2050.</p><p>“For the majority of the infill development that the city needs, that will be the private sector buying private crown leases, or private land, and taking advantage of the opportunities presented by the planning framework,” he says.</p><p>“That’s that degree of certainty that I think the industry needs.”<br><br></p><hr><p><strong><br>You are currently experiencing&nbsp;<em>The Urban Developer</em>&nbsp;Plus (TUD+), our premium membership for property professionals.&nbsp;</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"><div data-rmiz-wrap="visible"><div><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><br></div></div></div></div></div>

With an area slightly smaller than Luxembourg and a population forecast to increase by more than 150,000 by 2050, Canberra has to grow up, not out.  But how, and where…?

EG Funds BTR BNE Hero.jpg

<p>After more than two decades, the ripple effect of the James Street gentrification in and around Brisbane’s Fortitide Valley is by no means losing momentum.</p><p>Instead, it is reaching new heights.</p><p>A block away from the trendy strip’s restaurants, boutique shops, bars and landmark Calile Hotel, plans have been filed for a 33-storey twin tower mixed-use development.</p><p>The proposal by Sydney-based EG Funds Management comprises 551 apartments rising from a 3582sq m “island” site flanked by McLachlan, Ann, Connor and Morgan streets.</p><p>EG put its foot on the whole-block site in 2019 through its $750-million Yield Plus Infrastructure No. 2 Fund, purchasing it from Lang Walker’s Walker Corporation for $27.72 million.</p><p>The long-standing home to a three-storey car dealership showroom is regarded as one of the most sought-after site's in the Valley and was acquired with two development approvals in place.</p><p>Walker Corporation, which struck a $22.2 million deal with listed car group AP Eagers to secure the site in 2014, initially had earmarked it for two residential towers of 18 and 22 storeys comprising 441 units.</p><p>It then changed its plans, winning approval in 2017 for a 25-storey, 44,000sq m state-of-the-art office tower that could house up to 5000 workers, with a view to securing a large corporate tenant.</p><p>But times quickly changed and it wasn't to be.&nbsp;</p><h2>Back to the drawing board<br><br></h2><p>Under EG's newly lodged Rothelowman-designed dual tower scheme, one tower would house 326 build-to-rent apartments and the other 225 build-to-sell units.</p><p>They would sit above a mix of retail and showroom space as well as recreational amenities and community areas within the ground and podium levels.</p><div id="6f0KTKWavpVAiORC4xmAML"><picture><img src="//images.ctfassets.net/8pr762qjocl3/4W74dAZHgoUTGgQJnd4wPu/c89d32687865c5e1a60457c003de864a/EG_funds_btr_mid1.jpg" alt="Renders of EG's proposed twin tower development at 801 Ann Street and 80 McLachlan Street in inner-city Brisbane's Fortitude Valley." data-mce-src="//images.ctfassets.net/8pr762qjocl3/4W74dAZHgoUTGgQJnd4wPu/c89d32687865c5e1a60457c003de864a/EG_funds_btr_mid1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Renders of EG's proposed twin tower development at 801 Ann Street and 80 McLachlan Street in inner-city Brisbane's Fortitude Valley.<br><br></span></div></div><p>Tying the two towers together, a “bridge of green” dubbed the Quandong Common has been integrated into the design featuring dense landscaping as a natural vista for the communal facilities.</p><p>“The development provides a memorable marker to the inner-city skyline, with vertical landscaping dispersed generously and use of contrasting colour palettes between the two towers,” the planning documents said.</p><p>“The centrepiece of the development, a voluminous city room on Morgan Street crafts a publicly accessible space with vibrant facades, sub-tropical gardens, and a ‘heroic’ quandong tree.&nbsp;</p><p>“This entry threshold acts as a gathering place where residents, visitors, workers, and the broader community can come together to engage in the intensity of urban life all in the context of a subtropical garden space.”</p><p>Most significantly, however, the development proposal is a sizeable addition to Brisbane’s rapidly expanding build-to-rent pipeline and would accommodate a “vertical neighbourhood” of more than 1000 people.</p><h2>EG backs ‘sustainable urban growth’<br><br></h2><p>According to the planning report submitted in support of EG’s proposal, significant events in recent years had prompted it to take a new development approach to the site.</p><p>“Since receipt of the two approvals, significant events have occurred including Covid-19, population growth and confirmation of Brisbane as the host city for the 2032 Olympics,” it said. “These significant events have stimulated changes to policy direction for planning and development of Brisbane.</p><p>“Recent federal, national and local strategic policies are expressing a consistent direction whereby increased height and density is supported in appropriate locations, particularly to address a critical economic and community need for housing supply.”</p><p>The report said the proposal was “aligned with this emerging policy direction”.</p><p>EG development director Grant Flannigan says the plans also reflect the fund manager’s “commitment to both quality living and sustainable urban growth”.</p><p>“We are confident that our proposed plans address the pressing demand for diverse housing and seamlessly accommodate the emerging activity within Fortitude Valley.”</p><p>He told <em>The Urban Developer</em> the Valley was “perfectly located” for build-to-rent due to its connectivity to a vibrant neighbourhood and proximity to the CBD.</p><p>“EG has a strong focus on build-to-rent until the foreseeable future, with a focus on affordable rental to help alleviate the current rental challenges faced by Australians,” he says.</p><div id="5Cc4gsOZnJayt09LPHunRp"><picture><img src="//images.ctfassets.net/8pr762qjocl3/HJrSDhSKtIMVgbLJ7UrTv/3b513517f051b1be6fd58938d36b5ca3/EG_Leederville_BTR_.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/HJrSDhSKtIMVgbLJ7UrTv/3b513517f051b1be6fd58938d36b5ca3/EG_Leederville_BTR_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Late in 2022 EG Funds won approval for its affordable housing and build-to-rent community at Leederville in WA.<br><br></span></div></div><p>The Fortitude Valley twin tower proposal is among seven build-to-rent projects EG has in the planning/pre-planning phase across its $3.9-billion development pipeline.</p><p>Established in 2000, the fund manager has more than $5.1 billion in assets under management.</p><p>Overall, its plans for the site spanning 801 Ann Street and 80 McLachlan Street include 168 studio, 98 one-bedroom, 247 two-bedroom and 38 three-bedroom apartments across the two towers.</p><p>An array of communal amenities also are proposed, such as work-from-home spaces, sky terraces, gyms, a wellness spa, library, podium park and rooftop recreation terraces with a pool, spa area, sun deck, dining room and kitchen and BBQ areas.</p><p>With a total of 9452sq m of outdoor space, the development also “provides significant opportunities to rewild a highly urbanised location of Brisbane”, the documents said.</p><p>As well, 521 carparking and 689 bicycle parking spaces would be provided across four basement and three podium levels.</p><h2>James Street gentrification ushers new era<br><br></h2><p>Brisbane urban planning identity Ross Elliott says the EG proposal reflects the influence the James Street precinct and 25-plus years of gentrification have had on the inner-city area.</p><p>“It was rundown shitsville,” he says. “The extent of the turnaround is nothing short of remarkable.</p><p>&nbsp;“The Valley, New Farm and Teneriffe … it’s the new Clayfield and Ascot.</p><p>“Nearly one in four households in New Farm has an income of $4000 a week or more. So these are very much upmarket places now and well and truly gentrified.</p><p>“And what we’re seeing in development at the moment is that the focus is turning towards the high-end of the market because that is still feasible.”</p><div id="5yyiCjHzIBgpyLxDMfEfGN"><picture><img src="//images.ctfassets.net/8pr762qjocl3/6WxyGlNWweyRRNGhFlfzkr/41180d8ceeb5529ffc6a31f8f5f35313/Calile_James_St.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/6WxyGlNWweyRRNGhFlfzkr/41180d8ceeb5529ffc6a31f8f5f35313/Calile_James_St.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Calile Hotel on James Street was recently voted 12th in the world's top 50 hotels.<br><br></span></div></div><p>Putting on his hat as Suburban Futures director and chair of the Brisbane Lord Mayor’s Better Suburbs Initiative, Elliott says “exactly what we’ve done with the inner-city is exactly what we need to do in some suburban centres”.</p><p>However, he concedes: “It's difficult.</p><p>“In a suburban location, the challenge at the moment is that the build cost is the same and your realisation, whether you're selling or renting, is significantly less.</p><p>“So it’s really hard to make things work on any acceptable level of risk.”</p><p>Meanwhile, he says, with plans such as EG’s Fortitude Valley proposal being lodged <span style="font-size: 14pt; font-family: 'Times New Roman', serif; white-space-collapse: preserve;" data-mce-style="font-size: 14pt; font-family: 'Times New Roman', serif; white-space-collapse: preserve;">“there just doesn't seem to be any shortage of appetite for development in the inner-city</span>”.</p><p>But then, philosophically, he adds: “Really we should be grateful for any housing product at the moment.</p><p>“Let’s not be picky … if it satisfies that upper end, then potentially it frees up other parts of the market—hopefully.”<br><br></p><hr><p><strong><br>You are currently experiencing&nbsp;<em>The Urban Developer</em>&nbsp;Plus (TUD+), our premium membership for property professionals.&nbsp;</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>

The ripple effect of the James Street gentrification in Brisbane’s Fortitude Valley is by no means losing momentum, pushing to new heights…

Small Spaces EDM.jpg

<p>Transitional, liminal spaces such as forecourts, laneways and plazas have often been afterthoughts—but they can be key to setting an office apart in a challenging market.</p><p>Aspect Studios has made a point of emphasising the importance of these small spaces, particularly as tenants attempt to woo workers back to the office.&nbsp;</p><p>Aspect has won awards for its Sydney laneway revamp, Quay Quarter Lanes, and worked on small projects including Berry Square, created as part of Winten’s 1 Denison Street development, and Mirvac’s One Darling Island, a plaza for Google’s headquarters in Sydney.</p><p>“In CBDs, there are buildings that are almost placeless, and stark—buildings that could be anywhere,” Aspect senior associate Alex Woodside says.</p><p>“But the modern city is changing, and what tenants want is changing.”</p><p>The refocus on small spaces speaks to major “flight-to-quality” trends in the office sector towards better amenities and “wellness”, which has buoyed prime office assets in a difficult time for the commercial sector.</p><p>“Assets in the market that have not had significant investment and upgrades to appeal to occupiers will continue to struggle,” Knight Frank says in its latest Sydney CBD office report.</p><h2><strong>Designing for the tenant&nbsp;</strong></h2><p><br>Small spaces pose a challenge and an opportunity for existing assets.&nbsp;</p><p>“A lot of these big buildings—whether it’s Westpac’s headquarters on Kent Street, or 8 Chifley Square, or One Darling Island, or Berry Square—are home to major tenants,” Woodside says.&nbsp;</p><p>“The owners of these assets want those assets to be that level of quality that they will last, and they have to be places that people will want to sign up for 20 years.&nbsp;</p><p>“The work we do [with small spaces] is often the first thing people see, so if we can create a vibrant area, with a choice of where people socialise, sit and eat, centred around care and nature, it’s a massive bonus.”&nbsp;</p><div id="MdYg1dAolpmAny3WMYZUy"><picture><img src="//images.ctfassets.net/8pr762qjocl3/zjWXFVCwVqlC15JwzlQp2/5e9583ffe4114901737714e5e1f671f5/Small_spaces_mid_5.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/zjWXFVCwVqlC15JwzlQp2/5e9583ffe4114901737714e5e1f671f5/Small_spaces_mid_5.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Aspect won the Urban Habitat Award at the 2023 Council on Tall Buildings and Urban Habitat Awards in Singapore for Sydney's Quay Quarter Lanes.<br><br></span></div></div><p>Mirvac general manager for offices Andrew Butler says that for 1 Darling Island, a lack of ground plan amenity prompted a refresh and upgrade.&nbsp;</p><p>“The concept development for the upgrade was conducted in consultation with Google to ensure a coherent and precinct-focused experience for their employees and the public, and aligns with our approach to small-scale activations in urban communities,” he says.</p><p>“The activation of One Darling Island has reinvigorated the site, creating a more attractive and engaging urban space.</p><p>“These activations can significantly impact the streetscape and contribute to a positive overall experience for tenants and the surrounding community.”</p><div id="40uaqpDGLWMMrxJoarh3Fu"><picture><img src="//images.ctfassets.net/8pr762qjocl3/63WUf9BzISSlUQ1dCcIsJ3/320e17278cbac6b59a63e972e66e41f0/Small_spaces_mid_4.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/63WUf9BzISSlUQ1dCcIsJ3/320e17278cbac6b59a63e972e66e41f0/Small_spaces_mid_4.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ One Deniston Street, home to Berry Square, was delivered by Multiplex in 2020 and is home to companies such as Microsoft and Nine.<br><br></span></div></div><p>Similarly, developer Winten invested in the redevelopment of Berry Square at its 37-storey 1 Denison Street development.</p><p>“All of our projects have considered outdoor placemaking and amenity, from spaces like Berry Square to creating accessible roofs on our residential developments,” Winten development director Chris Ryan says.&nbsp;<br>&nbsp;<br>“With the changes in the area, such as the new Metro opening soon and 1 Denison St, there is a significant need for high-quality outdoor places.&nbsp;</p><p>“As a result of the project, seating in the space has been doubled, there are now a range of different green spaces to sit and relax including a day bed area and lawn… and we have significantly upgraded a new outdoor cafe structure that will welcome a new Japanese restaurant in 2024.”&nbsp;</p><h2><strong>Changing values</strong></h2><p><br>According to the Knight Frank Australian Horizon 2024 report released this week, the core Sydney CBD market is outperforming other office markets and new developments have triggered significant tenant migration.</p><p>This creates more opportunity for businesses to cluster around newly activated precincts. But of course, activation is the key term.&nbsp;</p><p>Winten’s Berry Square is an example of the benefits that revamping a small space can bring, says Aspect Studios global design director Sacha Coles.</p><p>“Berry Square was a good example of an ageing, traditional corporate forecourt to a building.&nbsp;</p><p>“Luckily that public space is in private title, owned by Winten, which had the foresight to engage something which meant that the general public would be attracted to.”</p><div id="50VZxvFURGCqgqCvR2GuIs"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5j94qusDfXvQOzTgswqBWW/e2d256355e71881a74c3858d53ac3b0d/Small_spaces_mid_7.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5j94qusDfXvQOzTgswqBWW/e2d256355e71881a74c3858d53ac3b0d/Small_spaces_mid_7.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Quay Quarter Lanes was developed by a team including SJB, Silvester Fuller, Studio Bright, Carter Williamson, Lippmann Partnership, Urbis, and Dexus.<br><br></span></div></div><p>The brief was to take a privately owned public place, delivered in 2000, and create a unique green oasis for the North Sydney CBD, says Winten’s Chris Ryan.</p><p>“Berry Square is part of the project approval for 1 Denison Street and is a rare north-facing sun-drenched space in the middle of North Sydney.&nbsp;</p><p>“There was a desire from the Rothwell family [owners of Winten] to reposition a rarely considered public space for people to be able to rest and relax in the CBD.</p><p>“[And] Winten has always had a high regard for the detailing of the landscaping in our projects, it’s part of the company’s core values.”</p><p>The focus on a space like that marks a step-change in the way developers and asset owners perceive buildings, and for tenants, how they want to be perceived.&nbsp;</p><p>“In an older city, at a different time, they would say here’s my foyer, walk across it from the taxi, into the amazing lobby, it’s incredible—but it’s the biggest and most impersonal thing,” says Coles.&nbsp;</p><p>“But now we actually care about our people and want to create a series of environments so they can work at their desks but also externally, take calls, have lunch.”</p><div id="3ukPmCneYOs9a8RakSuSi2"><picture><img src="//images.ctfassets.net/8pr762qjocl3/ywyHRycR9hYLGT0q2zOOO/c04ac0f117dc75e515f97ecee45712a9/Small_spaces_mid_1.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/ywyHRycR9hYLGT0q2zOOO/c04ac0f117dc75e515f97ecee45712a9/Small_spaces_mid_1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Aspect also designed Farrer Place in Sydney CBD, part of a redevelopment of two historic sandstone offices. </span></div></div><p><br>Woodside agreed with the focus on the small scale and the individual.&nbsp;</p><p>“It’s not the place for a large group of people to congregate, it’s about small groups and how they are able to interact and find comfort in a hard CBD environment. There’s an intimacy with these spaces,” she says.&nbsp;</p><h2><strong>Innovation and experimentation</strong></h2><p><br>Developer Mirvac has seen such potential in these spaces that it has invested in similar activations across its portfolio.&nbsp;</p><p>In addition to 8 Chifley Square, it has also redeveloped small spaces at 275 Kent Street and Riverside Quay in Melbourne, as well as the upcoming 21-storey 7 Spencer Street development that is set to deliver 46,000sq m of floor space as part of the emerging Northbank precinct.&nbsp;</p><p>Mirvac will develop 10 individual terraces to make the most of river views and natural light.&nbsp;</p><p>From a design and development perspective, small spaces can be staging grounds for everything from branding, experimental streetscapes and new materials.&nbsp;</p><div id="1RJygVZbxoqGnidTxhnibj"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1qOjB13uNm1wweZcPM3hok/ade2bae1c5797adc8b4ff84aa33d9020/Small_spaces_mid_2.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/1qOjB13uNm1wweZcPM3hok/ade2bae1c5797adc8b4ff84aa33d9020/Small_spaces_mid_2.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ One Darling Island is home to an A-grade office building with 22,197sq m of office space across six storeys.<br><br></span></div></div><p>“Small projects are tactically where we can test and innovate new ideas,” says Woodside.&nbsp;</p><p>“As designers, we can do more in smaller spaces and take more risk when we play with innovative materials.</p><p>“Something we’re using a lot more of is recycled materials, like our recycled plastic tabletops at One Darling Island.&nbsp;</p><p>“There’s often a weird tension between recycled products and the aesthetic outcome but that also ticked a lot of boxes in terms of sustainability outcomes.”</p><p>These small details can be both the sparks and indicators of change in how we approach our cities, says Coles.</p><p>“Cities have changed since the 1980s when they were all about exchange and finance” he says.</p><p>“Now they’re rediscovering their identities, as places of society and culture, not just trade and work and that’s fantastic.</p><p>“We’re liberated in the smallness of these projects and lots of small things together have a bigger impact.”<br><br></p><hr><p><strong><br>You are currently experiencing&nbsp;<em>The Urban Developer</em>&nbsp;Plus (TUD+), our premium membership for property professionals.&nbsp;</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>

Forecourts, laneways and small plazas have always tended to be afterthoughts in the development of buildings, but they  can be the key in moving assets into the ‘prime’ category…

[+] tud plus expo pavilions WEB.jpg

<p>At last count, there were more than 16.1 million buildings across Australia along about 2.3 million kilometres of roads.</p><p>But around $60 million from the public coffers is about to be splurged to construct another building that none of these roads lead to.</p><p>In fact, it will not even be in this wide brown land.</p><p>Nevertheless, for six months it will attract an estimated five million or so visitors, sharing the title of Australia’s most visited building with the Sydney Opera House that each year draws a tad more than 10 million.</p><p>The Australian Pavilion for Osaka’s World Expo 2025 will be a striking antipodean oasis among Japan’s cherry blossom trees—albeit with a few token eucalypts.</p><p>But while its existence will be fleeting compared to the closer-to-home cultural icon this year celebrating its 50th birthday, the importance of Expo as an enabler and showcase for cutting-edge built form cannot be underestimated.</p><p>The pavilion designs invariably provide a glimpse of the possibilities and path ahead for shaping our cities and urban environments.</p><div id="carousel-root" data-reactroot=""><image-carousel-remove-button><div class="rm-carousel-wrapper"><button id="rm-carousel" class="rm-carousel-btn">Delete</button></div></image-carousel-remove-button><div class="slider-wrap"><image-carousel><div class="slider-el"><img style="height: 100%;" title="1.jpg" src="http://images.ctfassets.net/8pr762qjocl3/6JBwnm33ttDyYrUS5UhMtu/93c7749a08994ae7803fece09a67eac0/1.jpg" data-mce-src="http://images.ctfassets.net/8pr762qjocl3/6JBwnm33ttDyYrUS5UhMtu/93c7749a08994ae7803fece09a67eac0/1.jpg" data-mce-style="height: 100%;"></div><div class="slider-el"><img style="height: 100%;" title="2.jpg" src="http://images.ctfassets.net/8pr762qjocl3/4Xu8wsz973bv1akNVnqXQo/037f3e20d3e60eeb0e46776a33bfbe67/2.jpg" data-mce-src="http://images.ctfassets.net/8pr762qjocl3/4Xu8wsz973bv1akNVnqXQo/037f3e20d3e60eeb0e46776a33bfbe67/2.jpg" data-mce-style="height: 100%;"></div><div class="slider-el"><img style="height: 100%;" title="osaka ring construction sized.jpeg" src="http://images.ctfassets.net/8pr762qjocl3/29GPcx0RRMqRWWPLjzTnLS/cc073c3274cb6c775fe28ded202564f9/osaka_ring_construction_sized.jpeg" data-mce-src="http://images.ctfassets.net/8pr762qjocl3/29GPcx0RRMqRWWPLjzTnLS/cc073c3274cb6c775fe28ded202564f9/osaka_ring_construction_sized.jpeg" data-mce-style="height: 100%;"></div><div class="slider-el"><img style="height: 100%;" title="3.jpg" src="http://images.ctfassets.net/8pr762qjocl3/2Fv3k3cfjgO0u2mPrYCNca/13166dbe57f865730dee2a0acf48f64b/3.jpg" data-mce-src="http://images.ctfassets.net/8pr762qjocl3/2Fv3k3cfjgO0u2mPrYCNca/13166dbe57f865730dee2a0acf48f64b/3.jpg" data-mce-style="height: 100%;"></div></image-carousel></div></div><p><br>“It’s where the seeds of future ways of living will be sown, and Expo 2025’s impact will be seen in our cities and urban landscapes across the decade that follows,” says Australian Pavilion lead architect and Buchan senior associate Nataly Ernst.</p><p>“Expo 2025 is about solving global challenges and will be a place for architects around the world to explore regenerative design, sustainability and innovation in materials and building methodologies.</p><p>“The emphasis is very much on creating a future that is carbon-positive and energy self-sufficient.”</p><p>The overarching theme of Expo 2025 is “Designing Future Society for Our Lives”.</p><p>About 150 countries and 25 international organisations will participate in the event, which is to be staged from April to October, 2025 on Yumeshima, a 390ha man-made island in the southern Osaka Bay area. It is expected to attract more than 24 million visitors.</p><p>Setting the Expo’s design tone, work is under way on what will be one of the world’s largest timber structures—a ring-shaped wooden canopy that will rise five storeys and encircle the exhibition precinct.</p><p>The gently sloping accessible “grand roof” has been designed by local architect Sou Fujimoto and draws inspiration from traditional Japanese timber craftsmanship that uses no nails.</p><p><span class="mce-preview-object mce-object-iframe" contenteditable="false" data-mce-object="iframe" data-mce-p-allowfullscreen="allowfullscreen" data-mce-p-src="https://www.youtube.com/embed/Wq7ravMwEyo?si=3ensJSpsUPrhy0kO"><iframe src="https://www.youtube.com/embed/Wq7ravMwEyo?si=3ensJSpsUPrhy0kO" width="560" height="314" frameborder="0" allowfullscreen="allowfullscreen" data-mce-src="https://www.youtube.com/embed/Wq7ravMwEyo?si=3ensJSpsUPrhy0kO"></iframe><span class="mce-shim"></span></span></p><p><br>To be constructed from 20,000 cubic metres of wood, it will be 615m in diameter and have a 2km circumference.</p><p>Not only will it be symbolic but it also will serve as a massive multi-dimensional, 30m-wide passageway and sheltering structure, topped by a 60,000sq m green-filled aerial corridor offering panoramic views of the Expo site and Osaka Bay.</p><p>Fujimoto describes the aim of the colossal canopy as providing a platform from which people “can see the future positively”.</p><p>“I designed a large ring-like platform that people can walk on and this will make a link of people and cultures from diverse worlds,” he says. “Here we share one sky above us.</p><p>“It is a place where people from all over the world will unite their thoughts, respect each other and experience something special together.”</p><p>The first World Expo—the Great Exhibition—was held in London’s Hyde Park in 1851. It was housed within the Crystal Palace—a glass-and-iron building longer than 11 Olympic swimming pools and twice the height of the landmark Hollywood sign in Los Angeles—that became a symbol of Victorian England and the industrial revolution.</p><p>Ever since, participating countries have been upping the ante on their pavilion designs for the gathering of nations, which happens every five years as a platform for sharing scientific, technological, economic and social progress with a view to finding solutions to global challenges.</p><div id="VNBF7fbzjAehR6QXqQ0qE"><picture><img src="//images.ctfassets.net/8pr762qjocl3/4HaaWikrjtFrKk2VTQDmfT/896eb31dd54a1c17e901c6af7c593e4f/aust_expo_88_Ken_Woolley.png" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/4HaaWikrjtFrKk2VTQDmfT/896eb31dd54a1c17e901c6af7c593e4f/aust_expo_88_Ken_Woolley.png"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Australian Pavilion at World Expo 88 in Brisbane, designed by Ken Woolley and featuring Ken Done art.<br><br></span></div></div><p>Buchan’s concept design for the Australian Pavilion's 3504sq m allocated plot at Expo 2025 was recently unveiled by the Department of Foreign Affairs and Trade.</p><p>Like renowned architect Ken Woolley’s famed pavilion design—boldly adorned with artist Ken Done’s colourful giant letters spelling Australia—for Brisbane’s 1988 World Expo, it aims to capture the essence of the nation.</p><p>And although the latest design is somewhat less retina-busting—hey, that was the 1980s, folks—it is no less era-defining and visionary.</p><p>Thirty-five years on, Australia’s population has grown from 16.5 million to nearly 26.5 million people—creating a national identity of greater substance, sophistication, diversity, creativity and ingenuity.</p><p>Encapsulating the nation’s ongoing evolution, Buchan's team has conceptualised the Australian Pavilion for Expo 2025 under the theme “Chasing the Sun”.</p><p>Ernst describes its form as “an abstraction of a eucalyptus gumnut”.</p><p>“We wanted a fresh, distinctly Australian concept,” she tells <em>The Urban Developer</em>. “Australia is vast and its regions are all different.</p><p>“In our research phase, we identified that the gum tree is common to all. There are more than 700 species, with a huge variety of forms, textures and colours. The gumtree and its nuts and blossoms provided our inspiration as an expression of diversity, resilience, growth and optimism.</p><div id="6AlEMB4r9sNsbggVKEsw94"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5UiNF4j1Y5X8GsHVsYcemc/079c98e43338fb0a242891a3526c01f2/1.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5UiNF4j1Y5X8GsHVsYcemc/079c98e43338fb0a242891a3526c01f2/1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Australian Pavilion is as “an abstraction of a eucalyptus gumnut”, says lead architect and Buchan senior associate Nataly Ernst.<br><br></span></div></div><p>“The gumnut has a protective shell and its colourful blossom bursts from within. Our facade has been conceived as a protective skin with an aperture that provides space for vibrant programming and activity to blossom.”</p><p>She says the concept also responds to the Expo 2025’s sustainability theme of “Designing Future Society for Our Lives” through the adaptability of the eucalypt to many conditions.</p><p>“Our design explores the concepts of circular economy, sustainability and our architectural responsibility to society.</p><p>“We’ll be primarily re-using a modular construction system that can be disassembled and re-used again, and most of the structure will have a second life.”</p><p>As well as the Australian Pavilion, the covers recently have come off a number of other inspiring and innovative Expo 2025 pavilion designs.</p><p>London-based studio Foster and Partners has designed the pavilion for the Kingdom of Saudi Arabia, modeling it after the organic forms of traditional Saudi villages.</p><p>It also has an emphasis on sustainability and is committed to reaching a net zero operational carbon target using solar technologies for electricity generation, rainwater recycling, low-carbon materials, and energy-efficient lighting.</p><div id="1Yd72YNstZB1mkxGKzT5xI"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1gQFafBsHjoMROdzdgDTuf/59cc11fea5d72674ef9701fcfca67a1b/the-pavilion-of-the-czech-republ.jpeg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/1gQFafBsHjoMROdzdgDTuf/59cc11fea5d72674ef9701fcfca67a1b/the-pavilion-of-the-czech-republ.jpeg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ A render of the Czech Republic Pavilion for World Expo 2025.<br><br></span></div></div><p>The design for the Czech Republic Pavilion is the work of Zurich-based Apropos Architects and features an ascending spiral form with a glass exterior paying homage to the country’s long tradition of glassmaking.</p><p>Spirals also are an integral part of the Poland Pavilion designed by Paris-based Interplay—providing inherent stability on a site exposed to wind and seismic forces. Timber is its chosen eco-friendly primary building material due to its low carbon footprint.</p><p>Milan-based studio AMDL Circle is behind the Nordic Pavilion, taking a sustainable and circular approach, purposely designing the structure for disassembly and reuse. It is planned to be built entirely of forest-managed wood.</p><p>China, Italy and Brazil are among the other countries to have revealed innovative, state-of-the-art Expo 2025 pavilion designs.</p><p>“Expo is a platform for Australia to showcase our design capability and innovation and participate in a global exchange of ideas,” Ernst says. “The event is an opportunity to explore architectural expression free from many of the usual constraints and is an important platform for architectural visioning for the future.”</p><p>She cites Rotterdam-based MVRDV’s Netherlands Pavilion for the World Expo 2000 as a classic example of design ingenuity that has come from the event.</p><p>Featuring six artificial landscapes stacked into a tower as a solution to future land needs, it became a lauded sustainable design for creating a building as a self-contained eco-system.</p><div id="3pvbwWsavKu2mGWSf09rdy"><picture><img src="//images.ctfassets.net/8pr762qjocl3/45vFCi0degIVR76in9O5ll/259e8100a3f393a47438d6fffee4d6fb/MVRDV_s_Dutch_Pavilion_for_Expo_2000_2.jpeg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/45vFCi0degIVR76in9O5ll/259e8100a3f393a47438d6fffee4d6fb/MVRDV_s_Dutch_Pavilion_for_Expo_2000_2.jpeg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ MVRDV’s Netherlands Pavilion for the World Expo 2000.<br><br></span></div></div><p>“It had an internal forest of trees and running water—revolutionary at the time—and was a catalyst for what we see in many buildings today in terms of integrating nature, and the way we repurpose and share space,” Ernst says.</p><p>The pavilion was subsequently converted into a co-working office building with two structures for student housing and parking.</p><p>Noting the vibrant Australian Pavilion design from Brisbane’s coming-of-age 1988 World Expo as a “bold expression of our growing confidence and our playfulness”, Ernst says: “Looking back across the years we can see how Australia's pavilions reflect the times.</p><p>“Expo is a place for experimentation and pushing boundaries—architects and designers everywhere will be looking to Expo for inspiration and ideas.</p><p>“It plays a significant and valuable role in driving innovation and creativity and showcasing it in one location. And our goal with the pavilion is to make an indelible impact, without leaving a trace.”</p><div id="5DDrSPIuXYsa1pKT4Ct4QL"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1zpHBgzOorcKygMznZYroJ/70147317bab145236681122cdef45540/21-09-26-brazil-pavilion-expo-20.jpeg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/1zpHBgzOorcKygMznZYroJ/70147317bab145236681122cdef45540/21-09-26-brazil-pavilion-expo-20.jpeg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ A render of the Brazilian pavilion planned for Expo 2025. </span></div></div><p style="background-color: #ffffff; margin-top: 0pt; margin-bottom: 0pt;" data-mce-style="background-color: #ffffff; margin-top: 0pt; margin-bottom: 0pt;"><br></p><hr><p><br></p><p><strong>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>

Lessons learnt from expo pavilions continue to impact our cities and how we live, say proponents, as designs for Osaka 2025 are revealed…

[+] tud plus hero for web (4).jpg

<p>The news that Ralan managing director William O’Dwyer <a href="https://www.theurbandeveloper.com/articles/ralan-boss-pleads-guilty-to-fraud" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/ralan-boss-pleads-guilty-to-fraud">pleaded guilty to fraud</a> marks the beginning of the end of one of the biggest legal cases in recent Australian property history.&nbsp;</p><p>Ralan’s ‘Ponzi-style’ funding tactics left carnage in their wake.&nbsp;</p><p>When administrators from Grant Thornton were called in during July 2019, $561 million was owed to creditors—and they found that the group had been <a href="https://www.theurbandeveloper.com/articles/ralan-group" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/ralan-group">trading insolvent since at least 2014</a>.&nbsp;</p><p>They blamed its “unsustainable”, “partial-Ponzi” business model, construction company collapses, manipulated financial records, and O’Dwyer himself—who siphoned off group funds to buy bitcoin and personal properties— for the demise of a company once considered an industry leader.&nbsp;</p><p>As part of a special investigation <em>The Urban Developer</em> spoke with senior lecturer in the University of Queensland School of Law Vicky Comino who says it is an example of how lack of transparency in funding practices can lead to major failures.</p><div id="J7ni2ibEKRzukY1kASLhv"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3bYTk54dYJz1AjxnAhgZDa/1a47b0f23037cf0d2e1c56345ef406dd/Ralan_infograph_v2.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/3bYTk54dYJz1AjxnAhgZDa/1a47b0f23037cf0d2e1c56345ef406dd/Ralan_infograph_v2.jpg"></picture><div><br></div></div><p>“These sorts of collapses, from the insolvencies of building companies to property finance schemes that we have seen in the past, such as with the high-profile Westpoint scheme in 2006, are very common and I suspect this sort of behaviour is much more common than we’d like to think,” she says.</p><p>But questions remain: how did a company as big as Ralan trade insolvent for so long, and how does the property industry learn from major failures such as Ralan Group?</p><h2><strong>O’Dwyer and the Ralan Group</strong></h2><p><br>Examining the history of the Ralan Group reveals a picture of a tightly held dictatorship with financial practices that increasingly veered into fraud.&nbsp;</p><p>Ralan was launched by William O’Dwyer in 1998 as a project marketing company and expanded into development in 2008.&nbsp;</p><p>O’Dwyer’s early history is murky, although media reports record him as being born in the United Kingdom. An archived Ralan Group webpage said he had “been involved in the marketing and development of property since 1993”.</p><p>From 2008 to 2012, the majority of the group’s 19 developments were profitable, with an average profit of $827,000 a project.</p><p>At the date of administration, the group had completed 30 developments, with a strategy of buying DA-approved land and undertaking off-the-plan sales in-house.&nbsp;</p><div id="7lAgRVaPx8iqeBxAr7gxUz"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5NoJLfP9N5YZhw0x9PZWfP/e411ac38d5b152815d3a3b2094ab641d/William_ODwyer_mid.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5NoJLfP9N5YZhw0x9PZWfP/e411ac38d5b152815d3a3b2094ab641d/William_ODwyer_mid.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ O'Dwyer was either the sole director or one of a small number of directors, including brother Bryan O’Dwyer, of all 50 Ralan Group companies.<br><br></span></div></div><p>It wasn’t until 2013 that the group incurred its first significant loss—$22.3 million due to delays for a Burwood development as a result of planning consent issues, which ended legal action between the group and the Burwood council.</p><h2><strong>Funding setup</strong></h2><p><br>Critically, from as early as 2008, purchasers were offered the opportunity to release their deposit to the group in exchange for capitalised interest of 15 to 20 per cent a year, to be deducted from the amount owed at settlement.</p><p>In one example, of the $3.6 million received in deposits in the pre-sale of Ralan’s Gold Coast apartments, $1.9 million was used to fund the settlement of apartments in a completed development in NSW.</p><p>Initially, only a small number of purchasers released their deposit to the group.&nbsp;</p><div id="3G48ugwwfmFuok7ohWAETy"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1SAgQfkCIuZKhlmLqJHUhw/dbae600599264efeb900a129c6214914/Ruby_Tower_interiors_mid.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/1SAgQfkCIuZKhlmLqJHUhw/dbae600599264efeb900a129c6214914/Ruby_Tower_interiors_mid.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ In the three years before entering administration, more than 500 of the rescinded contracts were identified relating to projects such as Ruby Towers.<br><br></span></div></div><p>However, in later years, more than 90 per cent of purchasers would release their deposit. In some instances, purchasers would only enter into a sale contract as an “investment” for the interest and rescind their contract before completion at no penalty.</p><p>Assistant professor at Bond University and member of the Centre for Comparative Construction Research Matthew Moorhead confirms this is not standard practice.</p><p>‘The most common practice is that a developer will take a 5 to 10 per cent deposit for off-the-plan sales,” he says.</p><p>“In places such as Dubai and Malaysia, buyers’ deposits go to the developer and it forms the developer’s equity, becoming a form of managed investment scheme.&nbsp;</p><p>“Here, it’s not widespread and generally it is frowned upon.”&nbsp;</p><p><br></p><div id="7ht1cnMpjuc0u0dcRwu3Oj"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3NLzROyIPxioB1vKkXQOdB/19c8dc0d5ee6786f05ebaab77c2791ad/Mid_article_resizes__34_.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/3NLzROyIPxioB1vKkXQOdB/19c8dc0d5ee6786f05ebaab77c2791ad/Mid_article_resizes__34_.jpg"></picture></div><p><br>Comino says it may have attracted buyers with promises of high returns.&nbsp;</p><p>“The unit holders, those people who paid their deposits, were promised high returns of 15 to 20 per cent. That should have rung alarm bells,” she says.</p><p>“They are victims though, and people like O’Dwyer who reportedly ‘personally guaranteed’ these investments are often charismatic—they know all the right things to say, and people get sucked in by them.</p><p>“The developer seemingly ran an unlicensed debenture scheme, so it was illegal, but the problem was, how would ASIC know unless someone reported it?”</p><div id="76h2wde3o4DdFRiPhJstge"><picture><img src="//images.ctfassets.net/8pr762qjocl3/696uW0oCJDRrvs1HaHlq3q/56b4eb145cf7b94c74c043111a037163/Ruby_Ralan_mid_3.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/696uW0oCJDRrvs1HaHlq3q/56b4eb145cf7b94c74c043111a037163/Ruby_Ralan_mid_3.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Ralan made promises the “investments” would deliver returns of up to 20 per cent capitalised interest. </span></div></div><p><br>Of course, there is a difference between off-the-plan buyers and experienced financiers.&nbsp;</p><p>But both Wingate and PwC told administrators back in 2019 that they had no idea this was a funding model practised by Ralan; they were sent favourable financial statements and documentation showing that purchasers’ deposits were being held in full in a trust account, which proved not to be the case.</p><p>“The banks and financiers didn’t suspect anything was going on in this case. But sometimes, even when they do, the attitude especially with large companies is that it’s best to support them through the hard times in the hopes that fortunes will be reversed instead of pulling the plug,” Comino says.&nbsp;</p><h2><strong>Construction trouble</strong></h2><p><br>With already questionable funding practices, Ralan’s decline was accelerated with the collapse of its main builder, Steve Nolan Constructions, in 2014.&nbsp;</p><p>Ralan Group funded the unpaid subcontractor payments in order to resume construction, taking on another builder, SX Projects, which entered into voluntary administration six months later.&nbsp;</p><div id="3SrDLQqpvy29t5kpeuCeXJ"><p>Just one of Ralan’s four planned Ruby Towers buildings was completed by the time of administration while its Budds Beach development, Sapphire, had not begun construction, although an estimated 90 per cent of its apartments were presold.&nbsp;</p><div><div id="3SrDLQqpvy29t5kpeuCeXJ"><picture><img src="//images.ctfassets.net/8pr762qjocl3/4XdXGdxRi1BVvmO22U79rS/6a883413eea4ddec77f4b7e8f0aa027e/Ruby_Towers_mid_4.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/4XdXGdxRi1BVvmO22U79rS/6a883413eea4ddec77f4b7e8f0aa027e/Ruby_Towers_mid_4.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The collapses of two construction companies cost the Ralan Group in excess of $60 million.<br><br></span></div></div></div></div><p>By this point, Ralan was struggling to secure construction funding for Ruby and Sapphire after those builder collapses and brought in PwC in its attempts to secure financing.&nbsp;</p><p>By July, 2019, all funding options were exhausted and cash reserves depleted, and the group appointed voluntary administrators.</p><p>However, Grant Thornton’s analysis showed that even if the group had secured funding for its Ruby Towers and Sapphire developments, it would have incurred an overall loss of more than $140 million, and the group would not have been in a position to continue.</p><h2><strong>Nightmare for creditors&nbsp;</strong></h2><p><br>At the time of administration, Wingate Group was owed $178.9 million, St George and Westpac $23.9 million, Balmain $28.5 million and National Australia Bank was owed $7 million.&nbsp;</p><p>Employees, 301 of them, were owed $1.46 million, but total unsecured claims—relating to purchasers who released their deposits to the group—totalled $323 million.</p><p><a href="https://www.theurbandeveloper.com/articles/ralan-creditors-vote-in-favour-of-doca" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/ralan-creditors-vote-in-favour-of-doca">Plans were put forward by O’Dwyer himself</a> that would offer creditors a discount on future apartments to be built by a third party—that <a href="https://www.theurbandeveloper.com/articles/ralan-group-reveals-mystery-partner" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/ralan-group-reveals-mystery-partner">turned out to be Jean Nassif’s Toplace Developments,</a> which itself has <a href="https://www.theurbandeveloper.com/articles/toplace-jean-nassif-developer-nsw-licence-cancelled" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/toplace-jean-nassif-developer-nsw-licence-cancelled">faced legal action over poor quality builds.</a></p><p>However, these were dismissed by administrators, who labelled the options “highly contingent and likely to fail”, given they also included a clause that would prevent creditors bringing any claims against O’Dwyer or Ralan Group.</p><div id="5fWFM9uGvc262RTaE15ooD"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5xK4kh8Zm1yqA2Xej75B8k/e2858ed7208412f562086e3aaa8322bc/RubyTower_view_mid.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/5xK4kh8Zm1yqA2Xej75B8k/e2858ed7208412f562086e3aaa8322bc/RubyTower_view_mid.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ In attempts to claw back some of the money from O’Dwyer himself, administrators issued a demand for $19 million.&nbsp;<br><br></span></div></div><p>O’Dwyer had made gross withdrawals from company accounts to purchase $5.5 million in personal property at Bondi, spent $1.6 million on bitcoin, $2.7 million on American Express cards and $3.2 million on personal withdrawals.&nbsp;</p><p>By the time of the creditor’s report in late 2019, the majority of the group’s assets had been or were in the process of being sold, but around 1500 off-the-plan buyers were left with nothing.</p><p>“Currently, zero has been paid out to unsecured creditors,” Grant Thornton told <em>The Urban Developer.&nbsp; </em></p><p>“Payment to Wingate is still in progress, as Wingate have their own receivers, so we are unsure as to the amount repaid to them, but they are not fully repaid as yet.”</p><h2><strong>The aftermath</strong>&nbsp;</h2><p><br>The failure of Ralan Group highlights major issues around the lack of transparency in the way some developments are financed, and the danger in having such major development companies in the hands of one person.</p><p>However, the aftermath paved the way for other players to move in, including the acquisition of the Sapphire site on the Gold Coast by Tim Gurner in 2021 after it was put up for sale by the administrators.</p><p>Alongside Wingate, Gurner plans a $1.25-billion mixed-use resort precinct on the 13,000sq m site at Budds Beach <a href="https://www.theurbandeveloper.com/articles/gurner-plans-125bn-budds-beach-towers" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/gurner-plans-125bn-budds-beach-towers">as a joint-venture with Wingate</a>.</p><p>Tim Gurner says that the resort development, La Pelago, is now sold out, totalling $350 million across the first tower with planning approval in place.&nbsp;</p><p>“We are now working exclusively with a tier one contractor to finalise a price so we can start construction,” Gurner told <em>The Urban Developer.</em></p><p>“Labour in Queensland is still in short supply due to the unprecedented pipeline of government infrastructure projects either under way or planned to commence.&nbsp;</p><p>“We are hopeful that the state government can work with the industry to address this critical labour supply issue and create a pathway for more private development projects to access the limited labour resources that are in play, so we can assist in delivering much-needed housing ahead of this looming housing shortage crisis.”</p><div id="4P9ek8ZO8t1gtk1RstQKPN"><picture><img src="//images.ctfassets.net/8pr762qjocl3/24t0MgaBHYlJp5BZH3ol5i/a73cb6ffc801959c1bf31b71612bc6f3/la_pelago_mid.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/24t0MgaBHYlJp5BZH3ol5i/a73cb6ffc801959c1bf31b71612bc6f3/la_pelago_mid.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Stage one of Gurner’s La Pelago on the Gold Coast has sold out. </span></div></div><p><br>William O’Dwyer declared bankruptcy in 2021, protecting him from having to further contribute to creditor repayments.&nbsp;</p><p>“Claims could have been made against him but the fact he is now bankrupt means it’s unlikely he will be liable for anything,” says Comino.</p><p>“A claim investigation would cost the trustee in bankruptcy potentially tens of thousands of dollars.”&nbsp;</p><p>While O’Dwyer’s guilty plea last month paves the way for a sentencing of up to 60 years in prison, it is too little, too late for many off-the-plan buyers, and many will wonder why O’Dwyer’s prosecution took nearly four years.</p><p>“ASIC will get a complaint, probably in this case from the administrators, setting out any breaches of director duties, like not trading whilst insolvent, but it’s really difficult to prove this, and they did not keep proper books,” says Comino.</p><p>“ASIC receives a lot of complaints from creditors, administrators and the public but it is very under-resourced with a really wide mandate.&nbsp;</p><p>“There is also the concept of being ‘too big to fail’—the idea that if these companies go down, a lot of people can suffer, and that means that it’s in the interests of many to keep them afloat at nearly all costs.</p><p>“But this is a really inadequate area of the law and [some] people know how far they can go and push the envelope.”<br><br></p><hr><p><strong><br>You are currently experiencing <em>The Urban Developer</em>&nbsp;Plus (TUD+), our premium membership for property professionals.&nbsp;</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>

The Ralan Group collapsed in 2019 owing half a billion dollars leaving a legacy of distrust, poor management and thousands of off-the-plan buyers and creditors in the lurch...

[+] infrastructure review edm.jpeg

<p>It was the news many were waiting for—what has survived the Labor Federal government’s review of the previous government’s infrastructure projects.</p><p>Federal Infrastructure, Transport, Regional Development and Local Government minister <a href="https://www.theurbandeveloper.com/articles/federal-infrastructure-pipeline-review-reactions" target="_blank" rel="noopener" data-mce-href="https://www.theurbandeveloper.com/articles/federal-infrastructure-pipeline-review-reactions">Catherine King announced the review in May</a> after the states and territories agreed on it at the April National Cabinet meeting.</p><p>An initial review was done as part of the October 2022-23 Budget to determine market capacity and inflationary pressures.&nbsp;</p><p>Now, the independent strategic review of the Australian government’s Infrastructure Investment Program (IIP) has recommended that 50 projects that had not started be scrapped and the money put aside for potential cost blowouts on other projects.&nbsp;</p><p>“Many projects lacked proper planning, didn’t have informed costings and weren’t ready for Commonwealth investment,” King says.</p><p>“The reviewers found an estimated $33 billion of known cost blowouts on projects in the infrastructure investment program.</p><p>“And they said there was a high chance that this would blow out even further.</p><div id="76BV6B4jcKCTF6bPTVPRxI"><picture><img src="//images.ctfassets.net/8pr762qjocl3/PTWCqFuL0H1piSjcYaAbV/719d14615067f0453925680cc0f33a54/Mid_article_resizes__28_.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/PTWCqFuL0H1piSjcYaAbV/719d14615067f0453925680cc0f33a54/Mid_article_resizes__28_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Victoria’s Suburban Rail Loop East project was one of many of big-ticket developments under review.<br><br></span></div></div><p>“For those not currently under construction, the report says that figure is around $14.2 billion.”</p><p>The review found it was impossible to deliver the 10-year pipeline of projects within the $120 billion allocated to the program. It said many were given a federal funding commitment too early and before detailed planning, design and costing were undertaken.&nbsp;</p><p>Other recommendations from the review included that 100 planned projects proceed, while 56 projects will proceed with some risks satisfied prior to delivery.&nbsp;</p><p>It also recommended that 36 projects complete planning, detailed costing and rescoping, and that funding for those projects be used for headroom in the IIP.&nbsp;</p><p>King said around 50 projects would have their funding cut, 400 would proceed, and many of the other 350 projects grouped in corridors where they would proceed as planned.</p><p>State governments would then treat those groups as rolling programs, proceeding with each stage and using all allocated funds for that corridor until more funding was necessary.&nbsp;</p><p>“We want states to be able to manage those projects better, streamline the administration, sequence those projects and then see it as a rolling series so that when that money starts to expire, the states will come to us as part of the budget process and seek further money for those corridors,” King says.</p><div id="38m7wm7UnQ79dRgg3PuK2W"><picture><img src="//images.ctfassets.net/8pr762qjocl3/Wq2GmxS3l5LD6fnFoJSj7/3f5d292207e53f1c3eb4008c277e56a9/catherine_king_mid_article_image.jpg" alt="Federal minister for infrastructure, transport, regional development and local government Catherine King says that some projects will be treated as part of corridors." data-mce-src="//images.ctfassets.net/8pr762qjocl3/Wq2GmxS3l5LD6fnFoJSj7/3f5d292207e53f1c3eb4008c277e56a9/catherine_king_mid_article_image.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Catherine King says that some projects will be treated as part of corridors.<br><br></span></div></div><h2>The projects that survived</h2><p><br>Though many projects have not had their funding cut, many have not had their funding increase.</p><p><strong>Victoria</strong></p><p>In Victoria, that is the<a data-mce-href="https://www.theurbandeveloper.com/articles/monash-commission-intermediary-cities-post-pandemic-planning-australia" href="https://www.theurbandeveloper.com/articles/monash-commission-intermediary-cities-post-pandemic-planning-australia" target="_blank" rel="noopener">&nbsp;case for the Suburban Rail Loop East</a> project—it has&nbsp; had a total investment of $2.2 billion, which will not be increased.</p><p>The Ballarat Intermodal Freight Hub ($9.1 million), Bendigo/Echuca Rail Line Upgrade ($168.7 million), Gippsland Logistics Precinct Stage 2 ($10 million), Gippsland Rail Line Upgrade ($447.7 million), Melbourne Airport Rail Link ($5 billion), Murray Basin Freight Rail Project ($334.7 million) and the North East Link ($1.75 billion) will all proceed as planned.&nbsp;</p><p>However, the Geelong Fast Rail project will not be federally funded, nor will the business case for the Melbourne Inland Rail Intermodal Terminal.&nbsp;</p><p><strong>New South Wales</strong></p><p>In New South Wales, the M12 Motorway ($1.63 billion), the North West Growth Corridor Planning and Early Works ($75 million), the Sydney Metro—West Sydney Airport ($5.1 billion), the Sydney Metro—West Sydney Airport Stage 2 Business Case ($77.5 million), and the West Sydney Freight Line and Intermodal Terminal Strategy and Business Case ($5 million) will all proceed as planned with no additional funding.</p><p>Faster rail upgrades will not be funded with the Sydney to Newcastle—Tuggerah—Wyong faster rail upgrade project losing out.&nbsp;</p><p><strong>Australian Capital Territory</strong></p><p>Canberra’s $218 million&nbsp; Light Rail Stage 2 upgrade will proceed as will the Monaro Highway upgrade for $115 million.&nbsp;</p><div id="4wsqvDtXwasisiGb6FJqEL"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1KqsppSZuSipK3OPRYICKa/cebdd4bbc504cce3bec6a1b5230f55e3/Mid_article_resizes__22_.jpg" alt="A render of the Western Sydney Airport's terminal once completed." data-mce-src="//images.ctfassets.net/8pr762qjocl3/1KqsppSZuSipK3OPRYICKa/cebdd4bbc504cce3bec6a1b5230f55e3/Mid_article_resizes__22_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Work is currently under way on the Western Sydney Airport.<br><br></span></div></div><p><strong>Tasmania</strong></p><p>All the tranches of Tasmania’s Freight Rail Revitalisation project promised federal funding will proceed as planned with no additional funding.</p><p><strong>South Australia</strong></p><p>South Australia’s Nationwide Freight Highway Upgrade Program with $400 million in funding will proceed with no additional funding along with the South Eastern Freeway Upgrade at $120 million.</p><p><strong>Queensland</strong></p><p>Faster rail has won Queensland additional funding with the Brisbane to the Gold Coast (Kuraby—Beenleigh Faster Rail Upgrade) project getting an additional $1.754 billion in federal funding through the IIP for a total of $2.875 billion.&nbsp;</p><hr><p><strong><a data-mce-href="https://www.theurbandeveloper.com/articles/infrastructure-review-tables-projects-with-additional-federal-government-funding" href="https://www.theurbandeveloper.com/articles/infrastructure-review-tables-projects-with-additional-federal-government-funding" target="_blank" rel="noopener">WINNERS: Full list of projects with additional federal funding</a></strong></p><hr><p>Brisbane Metro projects and Stage 3 of the Gold Coast Light Rail project will proceed without additional funding as will the $1.06 billion Coomera Connector Stage 1 project from Coomera to Nerang.&nbsp;</p><p>The business case for Brisbane Inland Rail Intermodal Terminal project and the business case for Toowoomba to Gladstone Inland Rail connection project will proceed as planned without additional funding to the $10 million already allocated to each.</p><p>Developing the business case for South East Queensland’s growth due to the Brisbane Olympic and Paralympic Games in 2032 will proceed with its current funding of $22.45 million.&nbsp;</p><p>The Direct Sunshine Coast Rail Line will receive an extra $160 million for a total of $1.44 billion in federal funding via the IIP and the Inland Freight Route from Mungindi to Charters Towers upgrades will get an additional $80 million for a total of $720 million.</p><h2>How the news has been received</h2><p><br>The changes to funding have implications for many of the state governments, according to Moody’s Investors Service vice president John Manning.</p><p>“The decision is credit negative for the State of New South Wales, (NSW, AAA stable), the State of Victoria (Victoria, AA2 stable) and, to a lesser extent, the State of Queensland (Queensland, AA1 stable),” Manning says.</p><p>“These three states will be the most heavily impacted as a result of the changed funding arrangements, which will require a reassessment of capital spending priorities to offset any funding shortfalls from the Commonwealth within their existing portfolios.”</p><p>Increased labour and material costs are named as the causes of the cost blowouts.</p><div id="4XwHsIuqjyWtPTLXteb9hf"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3kVYlAVVPTXT7u0YPhXjVm/85bccb8b0d669daa248cbd8d25be1e8d/6.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/3kVYlAVVPTXT7u0YPhXjVm/85bccb8b0d669daa248cbd8d25be1e8d/6.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Direct Sunshine Coast Rail Line will receive an extra $160 million.<br><br></span></div></div><p>“Some states will need to reprioritise other expenditure commitments to meet broader budget repair targets because some projects have already been contracted to the state and these projects will now lose their share of Commonwealth funding,” Manning says.</p><p>“Such projects include the NSW M7/M12 interchange (which is contracted to the NSW government-owned corporation Transport for NSW), which will lose $116 million in Commonwealth funding.”</p><hr><p><strong><a data-mce-href="https://www.theurbandeveloper.com/articles/projects-with-federal-funding-cuts" href="https://www.theurbandeveloper.com/articles/projects-with-federal-funding-cuts" target="_blank" rel="noopener">LOSERS: Full list of projects with federal funding cuts</a></strong></p><hr><p>Moodys does not anticipate a credit impact on Western Australia, South Australia, Tasmania or the Northern Territory.</p><p>It does, however, foresee a funding gap of between $500 million to $1 billion during the next six to nine months for NSW alone.</p><p>NSW treasurer Daniel Mookhey said that at a time when the state’s population is increasing, the federal government’s investment is decreasing.&nbsp;</p><p>Urban Taskforce chief executive Tom Forrest agrees, citing his dismay at the withdrawal of funding for the M7/M12 interchange, crucial infrastructure for the Western Sydney Airport.&nbsp;</p><p>“Elizabeth Drive is a two-lane goat track—without the M7/M12 connection, it is impossible for workers and passengers to get from Parramatta, Blacktown or Liverpool to the new airport,” Forrest says.&nbsp;</p><p>“There is no aviation fuel pipeline to the airport—so there will be hundreds of truck movements each and every day required just to ensure the planes servicing the new airport have fuel and this decision is a&nbsp; critical blow to investor confidence in Western Sydney.”</p><div id="5vMpy4sy2mxQv1ig6BYZMn"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3GJKiSHRNSHzWZPWDyvYff/0244ef59764ca9011de7ff67999540d7/mark_bailey_mid_article_image.jpg" alt="Queensland minister for transport and main roads, Mark Bailey says the new funding split arrangements would leave Queenslanders worse off." data-mce-src="//images.ctfassets.net/8pr762qjocl3/3GJKiSHRNSHzWZPWDyvYff/0244ef59764ca9011de7ff67999540d7/mark_bailey_mid_article_image.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Queensland minister for transport and main roads Mark Bailey.<br><br></span></div></div><p>But others are calling on the state governments to follow the fed’s lead.&nbsp;</p><p>“The biggest potential obstacle is federal co-ordination with the infrastructure plans of the states and territories,” Ai Group chief executive Innes Willox says.&nbsp;</p><p>“We urge all governments to support the review, to adopt a similar approach and to commit to transparent, rigorous and ongoing audit and review.</p><p>Willox says funds had been allocated to “sub-optimal projects” and this was a much-needed correction.&nbsp;</p><h2>Other recommendations</h2><p><br>The review also recommended that the funding split change from 80:20 to 50:50 between federal and state funding for any new projects.</p><p>Queensland transport and main roads minister Mark Bailey says Queenslanders will be worse off.</p><p>“The decision ... has been estimated by the Department of Transport and Main Roads to cost Queenslanders between $600 million and $1 billion per annum,” Bailey says.</p><p>“This is on top of cuts made elsewhere in Queensland, such as the decision to cease funding projects including the Mooloolah River interchange, the cap on funding on road corridors and changes to funding splits on existing projects.”</p><p>Bailey says the Queensland government will contest this new split in funding arrangements.</p><p>“Although Queensland has only the third largest population of any state, our vast state has the largest regional road network in the nation so the proposed change has the largest impact on regional Queenslanders than regions in any other jurisdiction.”</p><p>Creating long-term infrastructure plans in conjunction with each state and the federal government was also recommended as was a mandatory gateway assurance process, and an independent assurance review process.&nbsp;<br><br></p><hr><div id="2GhuueZl01Zwo2aFfjNVi2"><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></div>

Only the strong will survive as the details of the Albanese government’s review of its predecessor’s plans are laid out…

[+] cremorne profile RAN hero web.jpg

<p>For Adidas—the second-biggest sportswear&nbsp;maker and the owner of arguably the three best-known stripes in the world—Christmas can’t come soon enough.</p><p>By the end of next month, Fortis Development Group expects practical completion of its $130-million, eight-storey office building at Dover Street, in the inner-city suburb of Cremorne.</p><p>And Adidas will move its Melbourne headquarters north to the 2726sq m it has taken on levels six and seven of the Fieldwork Architects-designed building.</p><p>The German sportswear company will take another 400sq m on the ground floor for a retail outlet for its shoes and apparel. And it’s acquired naming rights—its famous logo will adorn the top of the building.&nbsp;</p><p>Office sector uncertainty? What uncertainty?</p><p>Cremorne—the tiny suburb just 3km upriver from downtown Melbourne—is defying the naysayers and, for now at least, the <a href="https://www.theurbandeveloper.com/articles/office-transactions-msci-vsummit-repurpose" data-mce-href="https://www.theurbandeveloper.com/articles/office-transactions-msci-vsummit-repurpose">downturn in the office market</a>.</p><p>When Adidas moves to the once working-class and industrial suburb of no more than a single square kilometre, it will join other big corporations including Seek, Tesla, Carsales.com, the Walt Disney Company, REA Group, Domain, Reece and MYOB.</p><div id="6OCeNiyJ2ccXp7JPcZwYMj"><picture><img src="//images.ctfassets.net/8pr762qjocl3/6ljgEGP2cejHbs27rpqooN/c8d1b7d5118931c39dd0eb15ecacf0f5/Fortis_Almost_Complete_Mid___800x500_.jpg" alt="A photo of the Fortis Development Group's new headquarters, which is almost complete.  But it will be Adidas which has its name up in lights." data-mce-src="//images.ctfassets.net/8pr762qjocl3/6ljgEGP2cejHbs27rpqooN/c8d1b7d5118931c39dd0eb15ecacf0f5/Fortis_Almost_Complete_Mid___800x500_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Fortis Development Group’s new headquarters is almost complete but it will be Adidas that has its name up in lights. Main image source: Kylah Smith</span></div><div><br></div></div><p>Fortis says it expects the building at 65-81 Dover Street will be fully leased by completion. Town planner Ratio has committed to floor space as has the co-working space provider, Commons. And Fortis’s parent, Pallas Group, is also expected to make it their new headquarters.</p><p>“This project has been a great success for us,” says Fortis senior development manager Jordan Winada.</p><p>So successful in fact, five months ago Fortis quietly closed on 665sq m right next door—at 85 Dover Street—reportedly paying $10.25 million for a three-storey,10-unit strata title commercial and residential block.</p><p>“That one was a no-brainer for us,” Winada told&nbsp;<em>The Urban Developer</em>&nbsp;last week.</p><p>“We purchased 65 Dover Street on the basis we thought it would go quite well but it’s outperformed everyone’s expectations.</p><p>“We’re very happy with what we’ve done there so it makes sense for us to take on that site next door.”</p><p>Fortis has development approval for eight storeys on the site and construction will begin in the second quarter of next year. That will take the net-lettable area of the two buildings to about 12,500 square metres. They will share basement parking.</p><p>Cranes dot the skyline of this suburb that is hemmed in by the Yarra River, Punt Road, Swan and Church Streets, and divided down the middle by the railway to South Yarra.</p><div id="4ZcWuipxBXMRXTV1TPB8xY"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3KtdA1OUELBATVyby3aICD/7db688c95b713e68fea9c472a807dee5/Pace_Rooftop_Mid.jpg" alt="A render of Pace Development Group's rooftop.  The San Telmo group has agreed to provide a restaurant, to be called Amatrice, at the Cubitt Street development." data-mce-src="//images.ctfassets.net/8pr762qjocl3/3KtdA1OUELBATVyby3aICD/7db688c95b713e68fea9c472a807dee5/Pace_Rooftop_Mid.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Pace has signed an agreement with the San Telmo group for a rooftop restaurant to be called Amatrice at its Cubitt Street development.</span></div><div><br></div></div><p>In fact, Nose to Tail—a creative agency with a focus on property and development—counts more than a dozen office projects in the neighbourhood either under construction or in the planning stage.</p><p>Come May next year, the long-time Cremorne resident will move less than 200m down the road to 4-6 Cubitt Street, where Pace Development Group has just topped-out their own nine-storey building, with 315-480sq m floor plates.</p><p>Its crane, at least, will disappear in January.</p><p>The collaboration between JCB Architects and Splinter Society is about 40 per cent leased, according to Pace head of commercial and legal Pete Micevski.</p><p>He says they will move their own headquarters to Cremorne, bringing together separate operations now in Fitzroy and St Kilda. He expects the remainder of the space to be leased before move-in date.</p><p>“Generally, we see leasing activity ramp up in the three to six months immediately prior to practical completion,” Micevski says. “So we expect the balance of the lots to be leased anywhere between now and the end of March or April.”</p><p>Known as “Silicon Yarra” in recent years (Cremorne contributes $4 billion to the Victorian tech economy each year, according to the Department of Jobs, Skills, Industry and Regions) it now seems everyone—not just the tech industry—wants to be in and around the neighbourhood.</p><p>Developers have seized on the moment.</p><div id="5OhhS2peczMjbg5roR005Q"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1ycphySUuWGqHzD4bwuAYt/df7697abe6b128390f11dcf24451911e/jll_matt_szakie__mid_.jpg" alt="JLL associate Matt Szakiel:  Cremorne is about more than just the location." data-mce-src="//images.ctfassets.net/8pr762qjocl3/1ycphySUuWGqHzD4bwuAYt/df7697abe6b128390f11dcf24451911e/jll_matt_szakie__mid_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ JLL associate Matt Szakiel: Cremorne is about more than just the location.</span></div><div><br></div></div><p>Just 130m from Pace Development’s build, Little Projects has its own nine-storey office tower under construction at 38-40 Cubitt. The DKO-Architects-design will deliver 8500sq m and some ground-floor retail.</p><p>And 200m on from that, in May this year diversified developer Time &amp; Place and joint-venture partner MaxCap Group <a href="https://www.theurbandeveloper.com/articles/time-place-maxcap-cremorne-office-melbourne-approved" data-mce-href="https://www.theurbandeveloper.com/articles/time-place-maxcap-cremorne-office-melbourne-approved">won development approval&nbsp;</a>for yet another nine-storey office tower on a 2678sq m site at 75-119 Cubitt Street.</p><p>Three blocks east, Bill McNee’s Vicland Property Group has also been greenlit by Yarra City Council, this time for <a href="https://www.theurbandeveloper.com/articles/vicland-cremorne-office-tower-approved" data-mce-href="https://www.theurbandeveloper.com/articles/vicland-cremorne-office-tower-approved">10-storeys of office and retail&nbsp;</a>space on a big 3500sq m site at 31-53 Cremorne Street.</p><p>It acquired the site from Blazer Clothing founder Peter Murray, paying $53.5 million in 2021. Construction is due to finish in 2025.</p><p>Boutique property developer Monno is building a $65 million, eight-storey office block at 22-26 Gordon Street and billionaire property developer and majority shareholder in the National Basketball League Larry Kestelman intends to move the NBL’s headquarters into the eight and four-story complex he plans on a 9628sq m site at 68-88 Green Street.&nbsp;</p><p>The list would appear to be endless.</p><p>The obvious attraction, according to JLL associate Matt Szakiel, is the location.</p><div id="4VZNQ8GVJiSC5DkvuWPD7F"><picture><img src="//images.ctfassets.net/8pr762qjocl3/5RnpFC38sP5Hsi9KN9UfsX/bbe135420abd0f2ec0d54cbae51ff65d/Maxcap-Time_and_Place_Mid__800_x_700_.jpg" alt="An architect's render of Time &amp; Place and joint-venture partner MaxCap Group's nine-storey office tower in Cubitt Street." data-mce-src="//images.ctfassets.net/8pr762qjocl3/5RnpFC38sP5Hsi9KN9UfsX/bbe135420abd0f2ec0d54cbae51ff65d/Maxcap-Time_and_Place_Mid__800_x_700_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Time &amp; Place and joint-venture partner MaxCap Group have won development approval for a nine-storey office tower on a 2678sq m site, also in Cubitt Street.</span></div><div><br></div></div><p>There are trams along Swan and Church streets. Richmond Station—just one stop from Melbourne’s Flinders Street Station—is a seven-minute walk away. The Yarra River, with its walkways and bike paths, is just a stone’s throw. And Melbourne’s weather notwithstanding, the central business district is a 20-minute walk.</p><p>The MCG, John Cain, Rod Laver and Margaret Court arenas, AAMI Park and the city’s Royal Botanical Gardens are all within walking distance.</p><p>As are countless pubs, bars, restaurants and cafes.</p><p>“Cremorne development was a success when it first kicked off because of the surrounding amenity to all of those buildings,” Szakiel says.</p><p>“The need for, I guess, a social life outside of the professional life ... they’re now sort of blending together as well.</p><p>“It’s a thriving area as far as the food and beverage offerings, and the retail offerings, are concerned. It brought tenants, not only from the metropolitan areas like Mulgrave, Burwood, Burwood East, it also brought tenants from the CBD out.”</p><p>There was a time, says Szakiel, when Cremorne was known by local residents as “a donut”—plenty of bars and restaurants on the outskirts, but an empty hole in the middle. That’s changing rapidly, as employers try to get workers back to the office in a post-Covid world.</p><p>Pace has signed an agreement with the San Telmo group—which boasts a handful of South American-themed steak restaurants around the city—for a roof-top restaurant to be known as Amatrice. And there’s also a ground-floor cafe and restaurant planned for the Cubitt Street building.</p><div id="2jZe4hvFBD3xlJUeVRbQHA"><picture><img src="//images.ctfassets.net/8pr762qjocl3/x8aKHubVcafkFWjBteaMW/66d172822748636814e926eb9fea33cb/Little_Projects_Cremorne_Mid__800_x_700_.jpg" alt="Little Projects has a nine-storey office tower under construction at 38-40 Cubitt.  " data-mce-src="//images.ctfassets.net/8pr762qjocl3/x8aKHubVcafkFWjBteaMW/66d172822748636814e926eb9fea33cb/Little_Projects_Cremorne_Mid__800_x_700_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Little Projects has a nine-storey office tower under way at 38-40 Cubitt Street.</span></div><div><br></div></div><p>“It’s at a time now where employers need to offer more than just a fancy-looking office,” says Pace’s Micevski. “They need to offer health and well-being amenity within the immediate precinct, if not the building.”</p><p>For its part, Fortis plans a high-end Japanese restaurant and wine bar, as well as a cafe-bakery on its ground floor. They will lodge an amendment seeking weekend trading for their retail, food and beverage spaces.</p><p>“You’ve got a captive audience in the residential area scattered throughout Cremorne,” says Winada. “And then you have the support of the commercial office buildings through the week.</p><p>“But weekend trading is a natural evolution of that suburb.”</p><p>Monno’s Gordon Street development is understood to include a restaurant and Little Projects has plans for a wine bar on its ground floor.</p><p>Pace will focus on public transport for its development. If tenants do wish to use a car, they can rent one from a car-share company that will have dedicated space within basement parking.</p><p>Fortis is offering an in-house digital content creation studio—for podcasts, green-screen recordings and photography—and their end-of-trip facilities will include a sauna. Others plan roof-top basketball courts.</p><p>Amenity aside, rental costs have been another key attraction, according to Szakiel.</p><p>“Tenants that were paying upwards of $800 or $900 a square metre, net, in the city could suddenly be one stop away, via Richmond station, from the city but paying hundreds of dollars in net rent less than what the CBD was offering,” he says.</p><p>And Cremorne has land supply.</p><p>JLL head of office institutional sales Paul Kempton says although suburbs such as South Melbourne, Carlton and Collingwood will always be good fringe office markets they are restricted in how much stock they can accommodate.</p><div id="1RWonWED786QMn4JOKo0up"><picture><img src="//images.ctfassets.net/8pr762qjocl3/7y44UY5ZVJelZexinvJV9n/d09e8ef14168631c49a836c5a417acc2/Monno_Gordon_St_Mid_800_x_785.jpg" alt="Boutique property developer Monno is building a $65 million, eight-storey office block at 22-26 Gordon Street." data-mce-src="//images.ctfassets.net/8pr762qjocl3/7y44UY5ZVJelZexinvJV9n/d09e8ef14168631c49a836c5a417acc2/Monno_Gordon_St_Mid_800_x_785.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Boutique property developer Monno is building a $65 million, eight-storey office block at 22-26 Gordon Street.</span></div><div><br></div></div><p>“Whereas Cremorne can actually accommodate a much larger scale of stock,” he says. “It’s up to 400,000sq m now but can probably go up to a million square metres, to be honest, over the next 10 to 15 years.</p><p>“And it will all be tenant-demand lead because the land’s there.”</p><p>Kempton is part of a JLL team brokering the&nbsp;<a href="https://www.theurbandeveloper.com/articles/melbourne-cremorne-victoria-industrial-site-listing" data-mce-href="https://www.theurbandeveloper.com/articles/melbourne-cremorne-victoria-industrial-site-listing">sale of a former textiles warehouse</a>, which sits on an 8320sq m island site in Cremorne Street, with four street frontages and commanding views of the Melbourne cityscape.</p><p>The property could fetch $80 million to $100 million via an expressions-of-interest campaign.</p><p>How long Cremorne can continue to defy the general state of the office sector is not clear.</p><p>Melbourne’s CBD is fighting back, with some tenants reportedly negotiating 70 per cent discounts on office rentals in Docklands, and between 45-50 per cent discounts on prime East End assets—that area at the top end of Collins and Bourke streets.</p><p>And while Szakiel is confident workers will return to offices in sufficient numbers, he warns the fallout from economic headwinds buffeting the industry could affect landlords and tenants.</p><p>“The way things are going, and the way construction costs are going—the trajectory that they’re heading on at the moment—it will be very hard for anyone that hasn’t got deep enough pockets to be able to get the funding,” he says.</p><p>“Those that are relying on investment to get these things out of the ground, are going to find it quite difficult in the short term.</p><p>“That flurry of developments we’ve seen in the past 12 months may slow, there could be a bit more of a shortage over the next few years as far as new builds are concerned.&nbsp;</p><p>“And those businesses that are holding back on determining what their ultimate work-from-home strategy will look like are going to need to make their minds up fairly quickly.”<br><br></p><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>

Cremorne—the tiny suburb just 3km upriver from downtown Melbourne—is defying the naysayers, and for now at least, the downturn in the office market...

1.jpg

<p>“In two years I think the apartment market is where you want to be. But you’ve got to work out how you’re going to make it work.”</p><p>Like many developers, John Issa is keeping his eyes on the horizon.&nbsp;</p><p>The LIV Developments founder knows the fundamentals are there for a return to form in Sydney’s apartment market. But the builder-developer says “something’s got to give”.</p><p>“The construction costs have gone up by 38 per cent, but apartments have not kept up with freestanding houses,” Issa says.&nbsp;</p><p>“Traditionally, the sale of an average apartment in Sydney would be at about 70 per cent of a house. That relationship is a bit out of whack at the moment. Apartments have not really moved that much. They haven’t kept pace.”</p><p>But making projects stack in the current market requires fortitude, according to Issa, who was speaking at <em>The Urban Developer’s</em> Members event in ANZ’s Sydney headquarters recently. &nbsp;</p><p>“Because when you’re crunching the numbers it doesn’t work at the moment, but you’ve got to look ahead a couple of years and what prices are going to be, and that’s what I’m doing,” Issa says. &nbsp;</p><div id="43IJKtg2BObgMKiKtWzlUz"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3IwiBnIVGTR01iQlvIbsLZ/4fb5aa09ab7890a3cb9ad21ac6234b4e/1.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/3IwiBnIVGTR01iQlvIbsLZ/4fb5aa09ab7890a3cb9ad21ac6234b4e/1.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ A render of LIV Development’s project in Sutherland, in Sydney’s south.<br><br></span></div></div><p>“Baseline scenario is what is the market doing today. So I’m not banking on that it is going to go up in 12 or 24 months, it’s got to work today. And that’s the way the banks will assess it as well.&nbsp;</p><p>“You’ve got to make it profitable today, and if it goes up in the future, well, that’s your bonus.”</p><h2>Deals starting to flow through</h2><p><br>Issa says while he ordinarily would only build out one project at a time, there were some deals flowing through the Sydney market.&nbsp;</p><p>“I’ve put myself in a position where I’ve actually purchased two or three sites in the past six months, only because I haven’t over-leveraged myself. I’ve set myself up, and it’s paying dividends now,” he says. &nbsp;</p><p>“I’ve picked up a couple of opportunities that say two years ago you wouldn’t get it at that price.&nbsp;</p><p>“I think a lot of developers out there have actually over-extended themselves, and with interest rates … I think some guys have got themselves in a bit of trouble, so that’s created some opportunities.”</p><p>Hills Shire apartment developer Patrick Azizi agrees.&nbsp;</p><div id="mbx7VvKdisXZ1igHvbIOe"><picture><img src="//images.ctfassets.net/8pr762qjocl3/4Etg1KtYl3zfA5v5liVfwp/abc6f360eb751e52c01f394fd3313981/4.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/4Etg1KtYl3zfA5v5liVfwp/abc6f360eb751e52c01f394fd3313981/4.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ People are very open to living in apartments regardless of their successes, says Northmark managing director Patrick Azizi.<br><br></span></div></div><p>&nbsp;“There’s definitely deals going around that are a little bit better than before,” the Northmark managing director says.&nbsp;</p><p>“Nearly every site in Sydney is a potential apartment site. So, potentially, in Sydney there’s an unlimited number of apartments that could come on the market—the government is just slow at releasing that.</p><p>“I feel apartments have a good place to go because in Sydney you look back 10 years and you wouldn’t want to live in an apartment. It was always that if you succeeded you would want to live in a home, but that way of thinking has changed and people are very open to living in apartments regardless of their successes. If anything it’s almost better to live in an apartment because it’s a low maintenance building.”</p><h2>Migration driving demand and opportunity</h2><p><br>ANZ senior economist Daniel Gradwell says the migration story is underpinning opportunities in the NSW development sector.&nbsp;</p><p>“Since the borders reopened the return of overseas migration has just been incredible,” Gradwell says.&nbsp;</p><p>“We had 150,000 people arriving into NSW from overseas in the past 12 months. Pre-Covid that was running at about 100,000 people—so an extra 50 per cent growth from only a couple of years ago.</p><p>“That’s quite astonishing and it’s a record level for NSW. Generally that population is incredibly strong and that’s feeding into demand, especially from a housing point of view.”</p><div id="46cOK8LJsKxRBFBIh9tyvf"><picture><img src="//images.ctfassets.net/8pr762qjocl3/1Cq2UHq5cwMDFiQrCG1CCE/596c3d302806821587de7889b3aac5aa/2.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/1Cq2UHq5cwMDFiQrCG1CCE/596c3d302806821587de7889b3aac5aa/2.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ Migration to NSW has skyrocketed, outstripping pre-pandemic levels.<br><br></span></div></div><p>Gradwell says we need to be building about 60,000 homes every year in NSW, but in the past 12 months we have built just 49,000, and that gap looks to be widening plus building approval rates have dropped to their lowest level in a decade.&nbsp;</p><p>“This is really where the opportunity is because that population story is going to stick around for some time to come,” he says.&nbsp;</p><h2>Costs, planning delays hamper industry</h2><p><br>Azizi says that in the apartment market there is planning risk involved, and Northmark runs a diversified portfolio to mitigate this risk. &nbsp;</p><p>“You’ve got the issue of timing (blowouts), but with the timing you also generally get the advantage of some growth in the market,” he says. &nbsp;</p><p>“Looking back I think it’s really important when you choose your sites to choose areas that are not oversupplied. There are some areas that have had massive rezonings and suddenly everyone’s in there building 15-storey buildings. You try to avoid those places.”</p><p>Issa says his builder-developer structure has helped to keep a tighter workbook but in the past two-and-a-half years he has had to absorb a 38 per cent increase in construction costs. Azizi says his costs have almost doubled.&nbsp;</p><p>But it’s not just the cost of construction that is causing headaches for developers in Sydney. ANZ senior economist Daniel Gradwell says capacity in the construction sector is constraining the development industry, particularly with the “incredible backlog” of public works.&nbsp;</p><div id="1jiM44QmCuY1bpVeKNjItE"><picture><img src="//images.ctfassets.net/8pr762qjocl3/3zTA2wA1NWbfrxIDMCzXOc/d552ae2bf82ce39940e15356c52595cb/Mid_article_resizes__26_.jpg" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/3zTA2wA1NWbfrxIDMCzXOc/d552ae2bf82ce39940e15356c52595cb/Mid_article_resizes__26_.jpg"></picture><div><span style="opacity: 0.8;" data-mce-style="opacity: 0.8;">▲ The Rozelle Interchange: ANZ senior economist Daniel Gradwell says the “incredible backlog” of public works is constraining construction.<br><br></span></div></div><p>“Even if we do that (cancel big infrastructure projects) that’s not an immediate fix because you can’t cancel projects that are already under way. You can’t leave a half-finished motorway,” he says.&nbsp;</p><p>“We’ve still got years worth of work to get through so you might see a bit of relief later in the decade. That’s probably valuable, but it doesn’t help the situation today.&nbsp;</p><p>“We need skilled migrants coming into Australia who can actually come in and hit the ground running, and that’s where the challenge comes from.”</p><p>Gradwell says wage growth is growing rapidly with data from the Australian Bureau of Statistics indicating wage growth was at its fastest rate in the history of the data series.&nbsp;</p><p>“The starting point of the economy is very good, but that’s part of the challenge that we’re facing into from a construction point of view, that availability of labour,” he says.&nbsp;</p><p>“Data shows housing construction costs in NSW are about 8 per cent higher than a year ago, but that’s come down from the 20 per cent growth rate that we had a couple of years ago. But 8 per cent growth is still a real challenge.</p><p>“Even with migration levels today, the question of where they’re going to live is very valid. I feel like that question used to get thrown around pre-Covid but it was more of a what-if scenario, but now I think it’s a very genuine concern. The vacancy rate across the country is less than 1 per cent, it’s not a balanced market.”<br><br></p><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>

Growth in Sydney's apartment market is a sure thing as the gap between supply and demand widens. But Sydney developers say "something's got to give"...

40a45208-cfc6-4541-9ec2-cf9c7f0e88c2

<div class="row ci"><p class="cell cs12 cx12">As a TUD+ member, you have special access to the following in-person and virtual events hosted by <em>The Urban Developer.</em>&nbsp;</p></div><div id="7IiDSOmIMLjc4zUjgp8aI2"><div id="4OvPUMJb65QSB1aUoe0fX0"><p><br></p><hr><div id="4GmCJmoxeGnun6gGiyrBYz"><picture><img src="//images.ctfassets.net/8pr762qjocl3/7n5guLuySGtHxTdmVjVlhP/22bb6169d452f602f3552a51797d257d/Cvent_Header_Images__600___400px___22_.png" alt="null" data-mce-src="//images.ctfassets.net/8pr762qjocl3/7n5guLuySGtHxTdmVjVlhP/22bb6169d452f602f3552a51797d257d/Cvent_Header_Images__600___400px___22_.png"></picture><div><p><strong>The Urban Developer Long Lunch (Brisbane) | Thursday 7 December 2023</strong></p><p>Join 300+ property professionals in Brisbane for a networking lunch hosted by <em>The Urban Developer. </em>Enjoy an all-inclusive dining experience while hearing perspectives and predictions from four leading Brisbane developers -&nbsp;Pikos, Graya, Silverstone and Griffith Group.</p><p><strong><a href="https://cvent.me/wYPlAN?RefId=TUD%2B+Member+%7C+Registration" target="_blank" rel="noopener" data-mce-href="https://cvent.me/wYPlAN?RefId=TUD%2B+Member+%7C+Registration">Click here to claim your member discounted ticket at $200 + GST (20 per cent off).&nbsp;</a></strong></p></div></div></div></div><div id="jlTockxVt1El6mp4DF20D"></div>

  As part of your TUD+ Executive Membership users are able to access selected virtual live events. 

TUD+ MEMBER CONTENT