Record Investment in Canberra Multi-Unit Development Sites
The first three months of 2015 has yielded record levels of investment in the Canberra multi-unit development site market with the strong activity driven by local developers set to continue through the year, according to Ray White Commercial.
Ray White Commercial Head of Research, Vanessa Rader, said during the 2015 March quarter there were sales totalling $80.446 million across 18 transactions, which is expected to yield 1,166 apartments.
“It is anticipated further properties current to market will see the first half of 2015 closer to 2,000 apartments,” Ms Rader said in the Between the Lines, Canberra Multi-Unit Development Sites report April 2015.
“This would outstrip the prior high in transactions during the first half of 2014 which resulted in more than $160 million changing hands with foreign investors and developers responsible for more than 40 per cent of the total volume.
“During the first three months of 2015, activity has been spread across a range of local developers taking the plunge into the Canberra development sphere, with no activity from off shore groups.
“This is emphasised by the volume of smaller transactions, with six sites sold for under $3 million offering sub-30 apartment projects which were hotly contested by builders, consortiums and other groups previously not as aggressive in this market.
“The number of larger projects, however, has driven this high volume with four projects with more than 100 apartments, including the 240 apartment mixed use development in Kingston for $14 million.”
Ms Rader said Gungahlin investment had been the most stable over the longer term and is likely to yield 195 apartments.
“Similarly, Belconnen and Molonglo will result in 259 and 380 apartments respectively with the majority of the Belconnen units delivered in the newly created suburb of Lawson,” she said.
Ray White Commercial Canberra Director, Andrew Smith, said since the beginning of 2014 more than $270 million has been transacted by the ACT Government Land Development Agency.
“The Land Development Agency has the potential to add more than 1300 apartments to the Canberra market,” Mr Smith said.
He said Ray White Commercial Canberra also sold a large tenanted office building, with redevelopment potential at 217 Northbourne Avenue, Turner, close to Canberra’s CBD, for $11.45 million.
“The 5,064 sqm site was sold to 217 NBA Pty Ltd, a local development company now investigating the future development potential of the site,” Mr Smith said.
“The site has the potential to yield approximately 150 residential units, which proved to be a major draw card for the buyer.”