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Residential development market downsizing

23 February 2017

There is still strong demand in Sydney’s residential development market, but a tighter lending market is leading developers to downsize their projects.

This is according to Ryan Bennetts, Associate Director, Development Sites, Residential at Colliers International.

He said: “We are seeing a growing trend of larger developers now looking for development approval for 15-30 apartments rather than 50-100 to ensure pre-sales cover debt and help secure lending.”
 

“Large Asian/local developers are both proving to be in this category when they never would have looked at boutique residential developments some 12 months ago.”

He added that another trend emerging to the benefit of developers is the inclusion of a retail component on the ground floor of new developments.

Ryan also revealed that “Crows Nest remains the most highly sought after location on the North Shore’.

The Department of Planning and Environment is carrying out a strategic planning investigation of the St Leonards and Crows Nest station precinct, which Ryan believes will lead to greater density.

He added: “In line with the introduction of the Crows Nest Sydney metro station, we’re seeing local property owners increasingly looking to amalgamate with one another to form an attractive land offering for residential developers.