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Sydney-based construction group Ganellen has yet to take over any of the building projects that were being carried out by collapsed builder Kell &amp; Rigby.
Ganellen commercial project director Chris Ahern told Property Observer the company was still in discussions on some of the projects but had not signed any contracts.
Ganellen negotiated an agreement with the administrators <a target="_blank" href="https://www.propertyobserver.com.au/industry-news/ganellen-to-take-on-kell-rigby-projects-as-reed-construction-also-faces-difficulties/2012030153639">as the preferred bidder on 15 major projects worth $50 million from the Kell &amp; Rigby collapse.</a>
At a creditors’ meeting in April administrators PBB said Ganellen was tendering on three projects but had not secured any tenders to date.
Under the agreement with administrators, Ganellen is to report the value of unsecured creditors they pay on contracts they secured, but at the time no contracts had been awarded.
The projects range from a luxury housing estate for Lend Lease to school libraries for a council.
Ganellen chief executive Peter Maneas told The Australian that only two of the 15 projects suited its business but the company could not reach “equitable terms” on either of these projects.
Maneas says he has a responsibility the staff, shareholders and clients to only pursue projects that are financially viable.
Some former clients of Kell &amp; Rigby have put out fresh tenders, including Bankstown City Council, which is seeking a builder for its $20 million library.
Lend Lease has re-tendered its St Patrick’s Estate Manly luxury house project.
Creditors of <a target="_blank" href="https://www.propertyobserver.com.au/industry-news/construction-company-kell-rigby-stops-work-as-financial-talks-collapse/2012021053329">Kell &amp; Rigby, one of Australia’s oldest building companies</a>, voted at an April 2 meeting to wind up the company.
The company shut down its operations on February 8 with administrators Mark Robinson and Stephen Parbery appointed on February 10.
About 1,400 unsecured creditors – many of whom are employees of Kell &amp; Rigby subsidiary businesses and contractors – are owed more than $16 million and will receive as little as 9¢ for every dollar owed, with some receiving nothing.
They include plumbing business G.M. Considine Plumbing, which is owed $500,000. At the time of its collapse it was managing 24 projects and employed 124 staff.
Former employees, which rank as priority creditors, will receive just 24¢ out of every dollar of the $4.3 million they are owed. The first secured creditor is the Commonwealth Bank, which is owed $2.2 million. Proceeds from the sale of Kell &amp; Rigby’s Strathfield head office will pay the bank out in full.
The second secured creditor is property developer Mulpha, which is owed $3.5 million, with administrators estimating a shortfall in excess of $2 million.
In total secured creditors will be refunded $3.67 million.
The administrators’ report says that over the past 10 years Kell &amp; Rigby worked on more than $400 million of projects in the residential and aged-care sectors, including projects with a number of public companies in addition to working with numerous private developers and investors.  Projects ranged in size from $3 million to more than $85 million.
It first ran into difficulties as far back as 1998 when it commenced two significant residential projects Paddington Green and <place><placename>Rockwell</placename><placetype>Gardens</placetype></place>.
“These residential projects proved to be extremely unprofitable and litigious, which significantly impacted the working capital position of the group,” says the report.
“One of these projects (which completed in 2002) resulted in losses of approximately $11 million due to cost escalation as well as another $4 million in relation to legal costs and defect rectifications,” says the report.
 
 
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lschlesinger-FZcF9M3vE6

Ganellen yet to take over any Kell & Rigby building contracts

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The regional centre of Manjimup, about 300 kilometres south of Perth, the Southern Hemisphere’s biggest producer of perigold black truffles, has also gained the title of the local government area with the most acute housing shortage.
The list of the 30 municipalities contains just three locations on the metropolitan fringe – the Perth suburbs of Melville, Mundaring and Joondalup – weakening the argument that land release problems in the outer suburbs of the major cities is a key reason for Australia’s contested housing shortage.
<img src="/images/stories/manjimup1.jpg">
Over the weekend, <a href="https://www.propertyobserver.com.au/residential/no-australian-wide-housing-shortage-csrs-ross-sindel/2012052154769">CSR chief executive Rob Sindel</a> rejected the notion that Australia is suffering from a nationwide housing shortage – he says there are shortages in certain places such as NSW, south-east Queensland and WA.
The top 30 list compiled by the HIA is dominated by WA, which makes up half (15) of the local government areas with the most chronic undersupply of homes, followed by Queensland (7), NT (3), Victoria (3) with one each in NSW and South Australia.
Manjimup needs almost an additional four dwellings (3.94) for every 100 people in the town, which has a population of just over 10,000 – or 399 dwellings, according to the HIA.
The agricultural rich lands of Manjimup (it also home to the pink lady apple) are just ahead of the more arid municipality of Palmerston (3.93 dwellings required for every 100 people), the planned satellite city next to Darwin followed by the WA town of Geraldton, 430 kilometres north of Perth, a beneficiary of the mining boom where a major iron ore terminal is located. Geraldton has a dwelling shortage of 791 for its 21,000 population.
The median house price in Manjimup is $265,000, according to Australian Property Monitors.
A kilogram of Manjimup truffles is worth around $2,000 – last season the biggest truffle unearthed weighed 348 grams.
Manjimup truffles are sought as far afield as Manhattan restaurants and in eateries in France and Germany, with truffle season running for three months from June until September.
According to realestate.com.au, there are 248 Manjimup properties for sale, including <a href="https://www.realestate.com.au/property-mixed+farming-wa-manjimup-7324305">this 55-hectare farm featuring a three bedroom residence</a>. Listed for sale by Rodney Musulin of Primaries Real Estate for $970,000, it is “ideal for most horticulture pursuits, including highly prized truffles and avocados”.
<img src="/images/stories/truff.jpg" width="470">
The list includes two suburbs close to the Perth CBD – Subiaco, which ranks sixth on the list with a shortage intensity of 3.383 and 611 homes, and eight-placed South Perth, with a shortage intensity of 3.048 and 1,386 homes.
In absolute terms, Joondalup, about 16 kilometres north of Perth has the highest shortage of houses at 3,955 a shortage intensity of 2.38 houses for every 100 people.
Top 30 LGA government areas where a housing shortage exists
<table style="width: 470px;" border="1" cellspacing="0" cellpadding="0"><tbody>
<tr>
<td valign="top" width="151">
LGA
</td>
<td valign="top" width="83">
State
</td>
<td valign="top" width="93">
Dwelling shortage
</td>
<td valign="top" width="99">
Population
</td>
<td valign="top" width="97">
Median house price
</td>
<td valign="top" width="93">
Shortage intensity
</td>
</tr>
<tr>
<td valign="top" width="151">
Manjimup
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
399
</td>
<td valign="top" width="99">
10,126
</td>
<td valign="top" width="97">
$265,000
</td>
<td valign="top" width="93">
3.94
</td>
</tr>
<tr>
<td valign="top" width="151">
Palmerston
</td>
<td valign="top" width="83">
NT
</td>
<td valign="top" width="93">
1,268
</td>
<td valign="top" width="99">
32,285
</td>
<td valign="top" width="97">
$465,000
</td>
<td valign="top" width="93">
3.928
</td>
</tr>
<tr>
<td valign="top" width="151">
Geraldton
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
791
</td>
<td valign="top" width="99">
21,361
</td>
<td valign="top" width="97">
$280,000
</td>
<td valign="top" width="93">
3.703
</td>
</tr>
<tr>
<td valign="top" width="151">
Litchfield
</td>
<td valign="top" width="83">
NT
</td>
<td valign="top" width="93">
753
</td>
<td valign="top" width="99">
20,389
</td>
<td valign="top" width="97">
$571,000
</td>
<td valign="top" width="93">
3.693
</td>
</tr>
<tr>
<td valign="top" width="151">
Darwin
</td>
<td valign="top" width="83">
NT
</td>
<td valign="top" width="93">
2,684
</td>
<td valign="top" width="99">
79,338
</td>
<td valign="top" width="97">
$550,000
</td>
<td valign="top" width="93">
3.383
</td>
</tr>
<tr>
<td valign="top" width="151">
Subiaco
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
611
</td>
<td valign="top" width="99">
19,674
</td>
<td valign="top" width="97">
$970,000
</td>
<td valign="top" width="93">
3.106
</td>
</tr>
<tr>
<td valign="top" width="151">
Bunbury
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
1,087
</td>
<td valign="top" width="99">
35,614
</td>
<td valign="top" width="97">
$340,000
</td>
<td valign="top" width="93">
3.052
</td>
</tr>
<tr>
<td valign="top" width="151">
South Perth
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
1,386
</td>
<td valign="top" width="99">
45,469
</td>
<td valign="top" width="97">
$727,000
</td>
<td valign="top" width="93">
3.048
</td>
</tr>
<tr>
<td valign="top" width="151">
Claremont
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
303
</td>
<td valign="top" width="99">
10,065
</td>
<td valign="top" width="97">
$1.2 m
</td>
<td valign="top" width="93">
3.010
</td>
</tr>
<tr>
<td valign="top" width="151">
Kalgoorlie/Boulder
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
968
</td>
<td valign="top" width="99">
33,319
</td>
<td valign="top" width="97">
$319,000
</td>
<td valign="top" width="93">
2.905
</td>
</tr>
<tr>
<td valign="top" width="151">
North Burnett
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
311
</td>
<td valign="top" width="99">
10,839
</td>
<td valign="top" width="97">
$150,000
</td>
<td valign="top" width="93">
2.869
</td>
</tr>
<tr>
<td valign="top" width="151">
Banana
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
427
</td>
<td valign="top" width="99">
15,542
</td>
<td valign="top" width="97">
$270,000
</td>
<td valign="top" width="93">
2.747
</td>
</tr>
<tr>
<td valign="top" width="151">
Melville
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
2,835
</td>
<td valign="top" width="99">
103,687
</td>
<td valign="top" width="97">
$670,000
</td>
<td valign="top" width="93">
2.734
</td>
</tr>
<tr>
<td valign="top" width="151">
Fremantle
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
785
</td>
<td valign="top" width="99">
29,318
</td>
<td valign="top" width="97">
$640,000
</td>
<td valign="top" width="93">
2.678
</td>
</tr>
<tr>
<td valign="top" width="151">
Broome
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
448
</td>
<td valign="top" width="99">
17,081
</td>
<td valign="top" width="97">
$675,000
</td>
<td valign="top" width="93">
2.623
</td>
</tr>
<tr>
<td valign="top" width="151">
Mundaring
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
1,021
</td>
<td valign="top" width="99">
39,753
</td>
<td valign="top" width="97">
$450,000
</td>
<td valign="top" width="93">
2.568
</td>
</tr>
<tr>
<td valign="top" width="151">
Northern Grampians
</td>
<td valign="top" width="83">
Vic
</td>
<td valign="top" width="93">
309
</td>
<td valign="top" width="99">
12,158
</td>
<td valign="top" width="97">
$150,000
</td>
<td valign="top" width="93">
2.542
</td>
</tr>
<tr>
<td valign="top" width="151">
Gannawarra
</td>
<td valign="top" width="83">
Vic
</td>
<td valign="top" width="93">
292
</td>
<td valign="top" width="99">
11,522
</td>
<td valign="top" width="97">
$153,000
</td>
<td valign="top" width="93">
2.538
</td>
</tr>
<tr>
<td valign="top" width="151">
Mount Isa
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
563
</td>
<td valign="top" width="99">
22,186
</td>
<td valign="top" width="97">
$349,000
</td>
<td valign="top" width="93">
2.534
</td>
</tr>
<tr>
<td valign="top" width="151">
Western Downs
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
818
</td>
<td valign="top" width="99">
32,727
</td>
<td valign="top" width="97">
$295,000
</td>
<td valign="top" width="93">
2.499
</td>
</tr>
<tr>
<td valign="top" width="151">
Hinchinbrook
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
298
</td>
<td valign="top" width="99">
12,240
</td>
<td valign="top" width="97">
$255,000
</td>
<td valign="top" width="93">
2.435
</td>
</tr>
<tr>
<td valign="top" width="151">
Albany
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
904
</td>
<td valign="top" width="99">
37,207
</td>
<td valign="top" width="97">
$375,000
</td>
<td valign="top" width="93">
2.430
</td>
</tr>
<tr>
<td valign="top" width="151">
Cambridge
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
667
</td>
<td valign="top" width="99">
27,552
</td>
<td valign="top" width="97">
$1.01m
</td>
<td valign="top" width="93">
2.421
</td>
</tr>
<tr>
<td valign="top" width="151">
Central Goldfields
</td>
<td valign="top" width="83">
Vic
</td>
<td valign="top" width="93">
308
</td>
<td valign="top" width="99">
12,854
</td>
<td valign="top" width="97">
$185,000
</td>
<td valign="top" width="93">
2.396
</td>
</tr>
<tr>
<td valign="top" width="151">
Berri &amp; Barmera
</td>
<td valign="top" width="83">
SA
</td>
<td valign="top" width="93">
268
</td>
<td valign="top" width="99">
11,259
</td>
<td valign="top" width="97">
$187,500
</td>
<td valign="top" width="93">
2.380
</td>
</tr>
<tr>
<td valign="top" width="151">
Joondalup
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
3,995
</td>
<td valign="top" width="99">
166,370
</td>
<td valign="top" width="97">
$525,000
</td>
<td valign="top" width="93">
2.377
</td>
</tr>
<tr>
<td valign="top" width="151">
Eurobodalla
</td>
<td valign="top" width="83">
NSW
</td>
<td valign="top" width="93">
915
</td>
<td valign="top" width="99">
38,607
</td>
<td valign="top" width="97">
$350,000
</td>
<td valign="top" width="93">
2.370
</td>
</tr>
<tr>
<td valign="top" width="151">
Scenic Rim
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
955
</td>
<td valign="top" width="99">
40,304
</td>
<td valign="top" width="97">
$390,500
</td>
<td valign="top" width="93">
2.369
</td>
</tr>
<tr>
<td valign="top" width="151">
Goondiwindi
</td>
<td valign="top" width="83">
Qld
</td>
<td valign="top" width="93">
274
</td>
<td valign="top" width="99">
11,646
</td>
<td valign="top" width="97">
$261,250
</td>
<td valign="top" width="93">
2.353
</td>
</tr>
<tr>
<td valign="top" width="151">
Vincent
</td>
<td valign="top" width="83">
WA
</td>
<td valign="top" width="93">
758
</td>
<td valign="top" width="99">
32,228
</td>
<td valign="top" width="97">
$600,000
</td>
<td valign="top" width="93">
2.352
</td>
</tr>
</tbody></table>
Source: HIA, median house prices provided by APM.
 
 
 
 
 
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Australia’s truffle capital, Manjimup, WA, has mushrooming housing shortage: HIA

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The Reserve Bank will keep an eye on China’s economic progress following new data showing the Chinese economy has slowed down, says governor Glenn Stevens.
Concerns about China's growth were expressed by Stevens as part of a questions and answer session following his speech to the Australian Payments Clearing Association (APCA) 20th Anniversary Symposium in Sydney today.
The new data, the HSBC Flash Purchasing Managers Index, showed that China’s purchasing managers index fell from 49.3 to 48.6 in May.
The index is considered an earliest indicator of the strength of China's industrial sector.
"One caution I'd offer is that we typically read a [purchasing managers index] level below 50 as meaning they're contracting, but what it means [for China is] they're growing slower than average if you calibrate that carefully," Stevens said.
Around half of the planned investment driving the current mining boom is based on expectations about the growth of China.
“Very few long-term economic issues therefore matter to Australia as much as how fast China will grow, for how long, and in what pattern,” wrote John Edwards, Lowy Institute visiting fellow, on <a href="https://www.google.com.au/search?q=australian+mining+boom+china+&amp;rls=com.microsoft:en-GB:%7Breferrer:source?%7D&amp;ie=UTF-8&amp;oe=UTF-8&amp;sourceid=ie7&amp;rlz=1I7GGHP_en&amp;redir_esc=&amp;ei=idPCT8KrKsaViAeRvtCQCg">Business Spectator in March</a>.
His comments followed the publication of a World Bank report that said that under a “favourable scenario” GDP growth in China would slow from the current rate of over 9% to 5% by 2026.
During his speech to the symposium today, Stevens also highlighted the growing role of the RBA as a regulator of financial markets.
He said the global push to strengthen financial regulation in the wake of the GFC had increased the role of the RBA in overseeing financial markets infrastructures (FMIs) such as securities settlement systems.
“Oversight of FMIs therefore demands a significant proportion of the Board's time. It is also this work that is expanding most rapidly.
“The logic of this reform is that it will reduce and simplify bilateral exposures between counterparties.  But it will also increase the systemic importance of the financial infrastructure, because we will in effect be creating a small number of ‘single points of failure’.
“Hence the resilience of that infrastructure will be critical, and the obligation of the official sector to provide proper oversight to ensure that resilience will correspondingly increase,” Stevens said.
 
 
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RBA watchful of China industrial slowdown: Glenn Stevens

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There is less than a month to go until five state home owners’ grants and one state stamp duty concession come to an end.
<img src="/images/stories/june302012.gif">
Victoria
On June 30 Victoria will end two bonus schemes aimed at first-home buyers – the $13,000 first-home bonus, which has run for three years, and the $6,500 regional bonus, which has run for two years.
These schemes will not be replaced.
Instead the government will increase existing stamp duty concessions for first-home buyers, as announced in the Victorian state budget.
From January 1, 2013 the <a href="https://www.sro.vic.gov.au/sro/sronav.nsf/LinkView/C88211C9E07486F0CA2578B70001025018E490D796850F8ECA2575C1008187C7">existing 20% stamp duty discount first-home buyers spending less than $600,000 on a house purchase will be increased to 30%.</a>
The stamp duty discount will rise to 40% on January 1 2014 and to 50% on September 1 2014.
To qualify for the stamp duty discount, first-home buyers must also qualify for the federal $7,000 first-home owners’ grant.
ACT
In the ACT, the <a href="https://www.revenue.act.gov.au/home_buyer_assistance/home_buyer_duty_concession/1_January_2012_-_30_June_2012">home buyer concession scheme (HBCS)</a> will end on June 30. The scheme provides stamp duty concessions on homes worth up to $470,000 and vacant land up to $260,000 and to qualify applicants must satisfy a combined income test for one year prior to the date of the grant starting from $120,000 for applicants with no children and up to $136,650 for applicants with five or more children.
No new schemes were introduced in the May 2011-12 ACT budget.
 
NSW 
The <a href="https://www.homebuyer.nsw.gov.au/newhomes.php">NSW government's home builders bonus</a>, which provides full exemption on stamp duty for new homes where the value does not exceed $600,000 and also applies to vacant land up to $400,000, will end on June 30. The scheme is available to everyone, including investors, who purchase a new house or apartment. For homes already under construction, a partial stamp duty reduction of 25% is available up until June 30.
The NSW state budget was handed down on June 12 <a href="https://www.propertyobserver.com.au/tax/nsw-doubles-its-first-home-grant-for-new-homes/2012061255075">wit</a><a href="https://www.propertyobserver.com.au/tax/nsw-doubles-its-first-home-grant-for-new-homes/2012061255075">h changes announced affecting investors and first-home-buyers from July 1 and October 1</a>. The changes create a<a href="https://www.propertyobserver.com.au/landlords/nsw-property-investors-condundrum-take-the-%2422490-housing-bonus-now-or-just-%245000-after-july-1/2012061255081"> conundrum for property investors.</a>
South Australia
The <a href="https://www.revenuesa.sa.gov.au/fhog/bonus8000">first-home bonus grant of up to $8,000</a> available to first-home buyers who qualify for the federal $7,000 first-home owner grant will be abolished from July 1, 2013. The first-home owners’ grant is not being phased out.
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Time running out for first-home bonuses and stamp duty concessions

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Four WA olive farms have been put up for sales by receivers KordaMentha.
The olive farms in Preston Valley, Avon Valley, Twin Brooks and Dandaragan belong to one of Australia’s biggest olive companies Kailis Organic Olive Groves, which has its headquarters in Osborne Park in Perth.
The company collapsed in November 2011 after being unable to repay debts of $18 million, with $15 million owed to Westpac.
Combined the four properties feature 1,800 hectares of olive plantations with an average age of 6.5 years and include modern processing facilities and over 10 gigs of water licences with a value of around $20 million, excluding the operating business.
The properties are available to be purchased separately.
The biggest property is <a href="https://www.eldersrealestate.com.au/rural/buy/property-wa-gingin-498076" target="_blank">Twin Brooks in Gingin</a> measuring 1,606 hectares with 449 hectares planted to olives.
<a href="https://www.eldersrealestate.com.au/rural/buy/property-wa-beverley-498073" target="_blank">Avon Valley in Beverley</a> measures 1,368 hectares over 20 titles, with 785 hectares of olive groves.
<a href="https://www.eldersrealestate.com.au/rural/buy/property-wa-mumballup-498078" target="_blank">Preston Valley in Donnybrook</a> measures 447 hectares and has 236 hectares of olive groves.
<a href="https://www.eldersrealestate.com.au/rural/buy/property-wa-dandaragan-498074" target="_blank">Dandaragan</a> measures 498 hectares and has 388 hectares of olive groves.
All four properties are being sold by Elders Real Estate via expressions of interest campaigns.
Mark Mentha, partner at KordaMentha, says there is strong interest in the farms from local syndicates of high-net-worth individual, super funds and Asian investors.
Olive oil producers in Australia have struggled to compete against cheaper imports from countries like Spain and Italy following the strengthening of the Australian dollar.
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Four olive farms put up for sale by receivers with $20 million price tag

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St Hilliers Construction founder Tim Casey says the firm is owed more than $6 million by the NSW government and has slammed its decision to take over 13 NSW social housing projects.
Speaking at a creditors' meeting in Sydney on Friday, Casey said he had written to the State Treasurer, Premier and Finance Minister over the $8.1 million in work St Hilliers has undertaken on the projects.
Casey claims the construction business has only been paid $1.4 million.
Of the $6.7 million still owed, $3.5 million is owed to sub-contractors of St Hilliers Construction.
Casey says St Hilliers plans to sell the company’s Cumberland Street headquarters in Sydney, worth up to $22 million, to pump money into the ailing construction business.
“It’s a high-handed decision of the state government to [terminate these state housing contracts],” Casey said at the creditors' meeting.
One contractor on the NSW housing projects, Ivan Stefanac, a gyprocker who is owed $41,000, told The Australian he does not expect to receive any money now that the government has taken over the projects.
At the meeting Casey said all but two of the projects would be reopened and said he was confident the construction business would find a way to start trading again.
There are about 1,000 creditors of St Hilliers Construction.
At the meeting, attended by about 100 creditors, administrators Trent Hancock and Michael Hird of Moore Stephens Sydney Corporate Recovery Group did not say how much was owed to creditors.
The <a href="https://www.sthilliers.com.au/Home">St Hilliers website </a>is functioning normally again after previously only linking through to a press release about the voluntary administration decision.
Separately, the Reed Group, which is facing the threat of supplier seeking to wind up the business, has had its claim that it is owed up to $70 million by the NSW state government rejected following a parliamentary hearing.
An independent expert panel chaired by Andrew Rogers QC found that the monies Reed claims it is owed by the state government were not “anywhere near” the true figure.
Reed claims the money is owed for work done on building roads and building schools as part of the federal government’s $16.2 billion Building the Education Revolution scheme.
 
 
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St Hilliers founder says government owes it millions, but Reed Group government claim rejected

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Rental yields have been increasing across most of Australia over the past 12 months and are better option than holding cash or government bonds, according to Janusz Hooker, executive chairman of real estate group LJ Hooker. 
Rising yields, he says, are being driven by softening property prices and increasing rents due to relatively low vacancy rates nationwide. 
“Given the forecast supply of rental stock and forecast demand for rental stock, rents look set to continue their five-year historical average growth of 5.8% per annum for apartments and 5.4% per annum for homes,” he says. 
“At present average gross yields for apartments in Australia are 5.2% (around 4.2% net of expenses) and for homes 4.5% (around 3.5% net of expenses). 
“If you look at real estate as a long-term asset class to hold, these yields are becoming increasingly attractive compared to cash and government bonds – not to mention the appreciation of the property asset,” Hooker says. 
“Typically more affordable housing has a higher yield. 
“Also property yields are often higher outside of the major metropolitan areas.” 
Hooker says the highest yields at present in Australia are in the mining boom towns in the Pilbara and central Queensland, where double-digit yields are achievable on rental properties.
 
 
 
 
 
 
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Rental yields on the rise and a better option than cash and bonds: Janusz Hooker

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Offshore investor demand for Australian commercial property, already strong, is likely to increase on the back of the weakening Australian dollar, say commercial property experts.
Savills has already noted anecdotal evidence of an up-tick in offshore demand as the dollar has fallen, “particularly from China, where the yuan is pegged to the US dollar”.
“We predict that further significant falls in the Australian dollar will lead to a surge in offshore investment in most forms of commercial properties, resulting in an escalation of values,” says Savills head of city sales and investments Clinton Baxter.
The Australian dollar reached parity with the US dollar in November 2010 and rose to a 29 year high of $1.108 on July 27 2011 before retreating.


Since the end of April 2012 the Australian dollar has decline from around $1.04 against the US dollar to below 98 cents with a more gradual decline commencing from the $1.09 level in February.
Australian dollar versus US dollar since July 2010
<img src="/images/stories/dollarchart1.gif">
Source: OANDA.com
However, Baxter along with counterparts at Knight Frank and CBRE, notes that offshore investor demand has remained high even when the Australian dollar was at record levels.
“Despite the Australian dollar reaching record highs over the past two years, the Australian commercial property market has experienced an unprecedented flow of investment capital from off-shore, particularly from China  and south-east Asia,” Baxter says.
“In the Melbourne CBD alone, half of all major transactions over the past 12 months have been to offshore investors.
“Counter-intuitively, motivation of offshore investors rose despite the protracted rise of the Australian dollar, with investors seeking a safe haven for their wealth, expansion into a new market, potential immigration advantage, and to invest in a country insulated from the woes of Europe and the US.”
Neil Brookes, director of international investments at CBRE, says the significant strengthening of the US dollar against the Australian dollar since February has positively affected buyers from the US and China.
“However the strengthening of the euro has not been as pronounced and therefore has not lessened the hedging costs for European investors,” he says.
Brookes says the volatility of the currency is a factor for some groups investing in Australia.
But he stresses that the majority of institutional buyers are looking at Australia as a long-term play and therefore aren’t sensitive to the currency variations.
Australian dollar versus euro since July 2010
 
<img src="/images/stories/eurochart1.gif">
Source: OANDA.com
Paul Henley, managing director of sales at Knight Frank, says there is already strong demand from offshore Asian private investors and institutions looking to invest and/or seek out development opportunities.
“The fall in the Australian dollar is only going to help,” he says.
Henley says investor interest is primarily coming from Asia, with the focus predominantly on the non-core office markets such as the St Kilda Road market in Melbourne and the North Sydney market.
“Investors are also seeking out development opportunities in Melbourne,” he says.
Henley says overseas buyers are seeking investments that represent a “strong return today” and will add value over time.
“They’re particurlarly targeting development opportunities in Melbourne.”
Henley says investors are looking to diversify their asset base and view Australia as a relatively stable economic climate.
“The Australian commercial market is not as foreign to these people as it was once – they are now very familiar with these markets.”
Before the strengthening of the dollar, Henley says Asian investors did not see the high exchange rate as an impediment.
“When the Australian dollar got to $1.05 against the US dollar we thought investor demand would slow down, but it didn’t slow down their appetite,” he says.
Earlier this month the <a href="https://www.propertyobserver.com.au/industry-news/new-asian-real-estate-website-adds-australian-commercial-properties-to-listings/2012051654720" target="_blank">ASX-listed iProperty Group launched a new Asian commercial property website, CommercialAsia.com</a>, which includes Australian commercial properties among its listings.
According to Jones Lang LaSalle figures, Australian investment volumes for office, retail and industrial in the first quarter of 2012 reached $2.08 billion, compared with $1.4 billion in the first quarter of 2011. Australia was one of the top investment destinations for overseas buyers over this period – behind Japan and Hong Kong. 
About a third of the investment in Australia has come from offshore, mainly from non-Asia Pacific investors. 
In its recent Asia Pacific Capital Markets MarketView report, CBRE said A-grade offices in Sydney, Melbourne and Brisbane continued to attract a steady flow of enquiries. There was also a jump in demand for retail assets accounted for $968 million worth of deals during the period – 40% of total sales over the period.
<img src="/images/stories/cbremay28.gif">
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Falling dollar encouraging even more offshore investment in Australian commercial property

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The Commonwealth Bank has today cut interest rates on some of its fixed-rate home loans by up to 0.4 percentage points. 
The rate cut matches the number of basis points it reduced its variable rate mortgages by on May 11, taking its standard variable down to 7.01%. 
However the bank has left its three-year fixed-rate mortgage offering – considered the benchmark fixed-rate product – unchanged at 5.99%. 
Click here for Property Observer’s three-year fixed-rate guide. 
The bank’s two-year fixed-rate product has been reduced by 40 basis points to 5.79%; the four-year fixed-rate product by 0.35 percentage points  to 6.29% and its five-year fixed-rate product by 0.35 percentage points to 6.39%. 
It is the second time this month that the bank has cut its fixed-rate home loan offering. 
On May 8, the Commonwealth Bank cut its one and three-year fixed-rate home loans by up to 0.34 percentage points. 
Earlier this month, Westpac has cut its headline three year-fixed mortgage by 20 basis points to 6.19%.

HSBC has cut its three year fixed-rate product to 6.09% or 5.99% for those investors who take up the interest-in-advance offering

ME Bank has also cut its three-year fixed rate mortgage product to 5.99%.
 
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Commonwealth Bank cuts fixed rates by 0.4 percentage points, but not three-year fixed product

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A 10-storey timber building, the tallest of its kind in the world, has today been launched in Lend Lease’s Victoria Harbour precinct.
Known as Forté, the $11 million will be built at 807 Bourke Street in Victoria Harbour and will be Australia’s first first timber high-rise building.
The building will rise to 32 metres and will be built with prefabricated wooden panels made from cross-laminated timber (CLT) and will feature 23 apartments.
<img src="/images/stories/forte1.jpg">
The multiple timber layers are glued and then pressed given them the structural strength similar to concrete or steel, allowing the building to bear the load of the 10 storeys.
<img src="/images/stories/forte2.jpg">
There will be seven one-bedroom apartments (59 square metres) priced from the mid-$400,000s, 14 two-bedroom apartments (80 square metres) priced from the late $600,000s and two penthouse apartments with two-bedrooms (102 square metres) priced from $800,000. The ground floor will be for retail space.
<img src="/images/stories/forte3.jpg">
In addition there will also be four townhouses.
More pictures on page 2.
 
<hr class="system-pagebreak">
 
Work on the site commenced in February with a targeted completion date of October – quicker than it takes to build some single-family houses.
<img src="/images/stories/forte5.jpg">
The project was officially launched by Lend Lease’s CEO for the Australian Business Mark Menhinnitt along with Victorian Premier Ted Baillieu, who says Forté will be a driver for "a new environmental footprint in Australia".
<img src="/images/stories/forte4.jpg">
"It means less energy and fewer emissions and will put Victoria at the forefront of sustainable design," says Baillieu.
It will also seek to be the first five-star green star as built certified residential building in Australia. Forté will reduce carbon emissions by more than 1,400 tonnes when compared with concrete and steel – the equivalent of removing 345 cars from Melbourne roads.
The Forté apartments will require 25% less energy to heat and cool than a typical apartment.
<img src="/images/stories/forte6.jpg">
Menhinnitt says the project will “unlock a new era for sustainable development by offering a viable alternative to traditional construction options, which are carbon intensive”.
He says Lend Lease will look to establish a "viable supply chain" for the CLT product and will also look for other applications for the product. Lend Lease is aiming to develop 30% to 50% of its apartment pipeline using CLT.
It will rise 2.42 metres <a target="_blank" href="/news">above the current highest timber building, a nine-storey, 29-apartment residential building in Hackney, London called the Stadhaus</a> (below), which was completed in January 2009 at a cost of £3.5 million ($5.6 million).
<img src="/images/stories/stadhaus.jpg">
The Stadhaus was designed by architects Waugh Thistleton in collaboration with structural engineers Techniker, and timber panel manufacturer KLH.
It was the first high-density housing building to be built from pre-fabricated CLT panels, the same technology that will be used to build Forté in Docklands.
Forté won’t be the tallest timber high rise for long, with Grocon planning on building a timber high rise on the old Carlton &amp; United Brewery site called Delta and due to be completed by 2014.
Using the prefabricated panels means a timber building can be built very quickly, explained Grocon building manager David Waldren following the launch of the project last year.
 
 
{module Would you buy an apartment in a timber building?}
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Lend Lease’s Docklands project Forté will be world’s tallest residential timber building

<a href="https://www.apartments.com.au/developments/broadbeach-qld-4218">Broadbeach</a> offers plenty of reasons to live vertically, but moving from a substantial family home into an apartment can expose the compromises of high-density living. Privacy, room for guests and usable living space tend to matter more when an apartment is intended as a permanent home rather than an occasional coastal base.

A typical residential floor at <a href="https://www.apartments.com.au/new-apartments/the-eveleigh-broadbeach-7-9-surf-parade-broadbeach-qld-4218">The Eveleigh</a>, on Surf Parade,&nbsp;contains just four apartments. The 94-residence development by <a href="https://www.apartments.com.au/developers/hirsch-faigen">Hirsch &amp; Faigen</a> is predominantly made up of expansive three-bedroom homes, with a limited collection of half-floor penthouses above.

Across the apartment floors, <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> has used the relatively limited number of residences to give each home greater access to natural light and outlook. Living spaces extend towards full-height glazing, while a series of bay windows frame selected views across the Pacific Ocean, city and hinterland rather than treating the building edge as a continuous wall of glass.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360965]

“The apartment floors deliver a collection of homes that embrace controlled outlook via a series of bay windows deliberately framing moments of view,” Rothelowman Director Kim Lowman said.

From outside, those projecting forms contribute to the tower’s faceted profile. Strong horizontal and vertical elements establish its proportions, while the changing position of the sun alters the light, shadow and reflection across the façade throughout the day.

The same attention moves inside the apartments, where the material palette combines warm timber, natural stone, metallic detailing and softer curved forms. Kitchens sit within the main living zone, with stone island benches, integrated joinery and European appliances, before the living areas extend towards the glazing and the outlook.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360981]

Three genuine bedrooms provide room to accommodate family and guests, while two secure car spaces and storage address some of the practical considerations that can become more noticeable when moving from a larger home. Feedback from the display suite has centred on the warmth and restraint of the interiors, with buyers commenting that the residences feel like homes rather than conventional coastal apartments.

A limited collection of half-floor penthouses occupies the upper levels, increasing the scale of the living spaces and adding private balconies and elevated finishes. From this position, the outlook extends between the ocean and hinterland.

Outside the private residences, The Eveleigh separates its shared spaces between the podium and rooftop. The podium is centred on wellness, with subtropical landscaping surrounding a swimming pool and pool terrace, yoga garden, private gymnasium, sauna and hot and cold plunge facilities. Landscaped retreats and pavilions provide additional places to sit away from the main recreation areas.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360966]

Higher in the building, a rooftop pavilion and private dining suite sit alongside resident lounge, barbecue and outdoor dining areas, opening towards panoramic views across the ocean, city and hinterland.

“Buyers are no longer just looking for an apartment, but a lifestyle where they can relax, reset, and enjoy a balanced way of living,” Hirsch &amp; Faigen Director of Sales Matt George said.

Interest to date has come from established owner-occupiers and interstate lifestyle purchasers, including buyers planning a future move to the Gold Coast. Many are coming from larger homes and want to reduce ongoing maintenance without giving up space for family and guests, privacy, two car spaces or the ability to entertain at home.

&nbsp;

[smartcode_project:default project_id=149670 project_image_fid=360969]

Much of that daily life can also take place beyond the building without requiring a drive. Kurrawa Beach and Pratten Park are an easy walk from Surf Parade, while Pacific Fair, Oracle Boulevard, The Oasis, restaurants, cafés, entertainment and public transport are also within walking distance.

The Eveleigh is Hirsch &amp; Faigen's fourth Gold Coast development since entering the market in 2021, following The Hemingway at Palm Beach, The Emerson at Kirra and Yves at Mermaid Beach. Each of the preceding projects sold out before completion.

“Broadbeach had been on our radar throughout our time operating on the Gold Coast,” the developer said. “Following our projects in Palm Beach, Kirra and Mermaid Beach, Broadbeach represented the natural next step for the business.”

The Surf Parade site brought together proximity to the beach, protected coastal outlooks and walkability to dining, shopping and recreation. Hirsch &amp; Faigen also identified the street as an emerging premium residential address, with enough separation from Broadbeach's busier destinations to retain a quieter environment at home.

The Eveleigh is now under construction by Maxcon, with completion forecast for mid-2028. Three-bedroom residences are currently available from $2.87 million.

[smartcode_project_cta:default project_id=149670]

Joel Robinson

The Eveleigh brings house-like apartments to Broadbeach

A long-stalled Campbelltown development site is back in play, with new plans for 139 apartments set to supersede a mixed-use scheme approved almost a decade ago but never built.

The new proposal for 28 Cordeaux Street would deliver 116 market and 23 affordable apartments in a part 14-storey building, bringing a substantial new project into a Campbelltown market where new apartment supply remains limited.

Plans have been filed over the 3,092 sqm corner site at Moore-Oxley Street, around 600 metres from Campbelltown Railway Station and the city-centre retail core.

The site already carries a mixed-use residential approval dating to 2016. Doroch Architects has now been engaged on a larger replacement scheme, which is progressing as a State Significant Development Application following a Housing Delivery Authority determination in August 2025.

The apartment mix comprises 39 one-bedroom, 72 two-bedroom and 28 three-bedroom residences. Two-bedroom apartments make up just over half of the project, while three-bedroom homes account for 20 per cent.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="136dd5b9-3791-4da6-9e31-76f533f5b4de" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da2.png?VersionId=LgOSy9nwf5u.MGswBBwaGGxuX8QpHSl_" />

Of the 139 apartments, 23 will be delivered as affordable housing under the in-fill affordable housing provisions of the Housing SEPP. The affordable component represents 15 per cent of the residential gross floor area and will be managed by a registered Community Housing Provider.

Doroch has sought to break the scale of the building into two distinct elements, with a masonry podium of around four storeys establishing the street edge before the residential tower steps back above.

The corner position has shaped that approach. Cordeaux Street faces toward the commercial and civic centre, while Moore-Oxley Street leads into the lower-scale residential neighbourhood to the south, and the design verification report describes the site as "bridging the commercial core to the north and established residential areas to the south."

The podium will be expressed predominantly in face brick, while the upper levels shift to brushed and grooved concrete cladding with darker metal detailing. Recessed sections, deep balcony edges and landscaping break down the upper form, with an approximately 11.8-metre setback to the northern boundary addressing the adjoining St Peters Anglican School.

<img alt="First look: New 139-apartment plans revive long-stalled Campbelltown city centre site" data-entity-type="file" data-entity-uuid="c8b3d2d3-c561-4bfc-a5d9-a68c0c10dac1" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Campbelltown%20da1.png?VersionId=AeAEyJU02Gk2k5noUj2StziCvdQ7fW4B" />

Campbelltown has been starved of new residential developments in the last decade.

The only other notable development set to come to market this year is ALAND's Queen Square, a mixed-use precinct on over two hectares that will comprise apartments above a vibrant ground-level retail and hospitality dining precinct.

First look: New 139-apartment plans revive long-stalled Campbelltown city centre site

First Look: Sherlock Construction pitches apartments for low-rise Deception Bay

Queensland builder-developer MAYD has revealed the first look at its major North Kirra beachfront development, lodging amended plans that reduce the number of apartments and increase the proportion of larger residences.

The project is planned across a substantial 4,742 sqm amalgamated site spanning seven lots at <a href="https://www.apartments.com.au/new-apartments/2-6-pacific-parade-bilinga-qld-4225">2-6 Pacific Parade</a> and 27-33 Golden Four Drive in Bilin​ga, directly opposite Nor​th Kirra Beach.

<a href="https://www.apartments.com.au/developers/mayd-group">MAYD</a> secured the site for $32.5 million in 2025, in what was one of the Gold Coast's largest property transactions of the year.

The development will be delivered across two stages, with the first stage carrying an estimated gross realisation value of around $360 million.

The latest amendments seek to reduce the overall apartment count and shift the project further toward the owner-occupier market, with larger residences designed for buyers wanting considerably more space than traditionally offered in a beachfront apartment.

The residential mix will include townhomes, oversized two-bedroom apartments, substantial three-bedroom residences and four-bedroom homes.

MAYD has appointed Cera Stribley to lead the architecture and interiors, with the Melbourne-based design practice drawing on the beachfront setting through a series of ocean-facing terraces and heavily landscaped balconies.

Strong horizontal forms and curved balconies will define the exterior, with subtropical landscaping integrated throughout the building to soften the built form and increase the connection between the residences and the beachfront.

The project will also include an extensive collection of resident wellness and lifestyle facilities, continuing the broader shift across the Gold Coast's luxury apartment market toward larger homes supported by resort-style amenity.

<img alt="MAYD" data-entity-type="file" data-entity-uuid="d1bcbb05-e659-4b47-8bd4-1e595315e2ad" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-27%20at%202.05.03%E2%80%AFPM.png?VersionId=jj0XEud1X1DuLt7_KyElhjMdZGOXmLHP" />

MAYD Founder Todd Mould said North Kirra was increasingly appealing to buyers attracted to the more established, lower-density character of the southern Gold Coast.

"North Kirra presents one of the most compelling luxury residential opportunities currently emerging in Australia, combining absolute beachfront with the character and authenticity that buyers are increasingly seeking, and the same sense of tight-knit community that defined Burleigh and Currumbin perhaps 10 or 15 years ago," Mould said.

"With Gold Coast Airport on its doorstep, it also offers a level of accessibility that broadens its appeal across almost every market demographic."

The project comes as the southern Gold Coast continues to attract an increasing share of high-end apartment development and buyer activity.

Kirra in particular has emerged as one of the region's more tightly held beachfront markets, with its relatively low-density character, established surf and hospitality scene and proximity to Gold Coast Airport differentiating it from the higher-density markets further north.

Mould said those characteristics had informed the approach MAYD and Cera Stribley had taken to the project.

"We've worked closely with Cera Stribley to create a vision that is deeply connected to its surroundings," he said.

"Inspired by the coastline itself, the architecture has been shaped around space, privacy and resort-style living, creating a collection of homes that reflects the next generation of luxury on the southern Gold Coast."

MOTIV Managing Director Carly Cottam, who has been appointed to market the project, said buyer attention had continued to move south along the Gold Coast.

"Purchasers who may once have defaulted to Broadbeach, Main Beach or Surfers Paradise are increasingly recognising the value of a genuine beachfront location that offers lower density, strong amenity and a more established sense of community," Cottam said.

"Kirra has a powerful combination of growing demand and genuine scarcity. Beachfront supply is inherently constrained, the area remains relatively low density, and buyers are increasingly placing a premium on locations that feel established, uncrowded and authentic rather than heavily developed."

Cottam said the proximity to Gold Coast Airport was also proving increasingly important for interstate and second-home buyers.

"Being minutes from Gold Coast Airport makes it particularly compelling for interstate buyers, frequent travellers and second-home purchasers who can access an authentic coastal lifestyle almost immediately after stepping off a flight."

The acquisition takes MAYD's active development portfolio to more than $500 million, with the North Kirra project representing one of its largest undertakings to date.

MAYD is targeting an early 2027 launch.

First look at MAYD's North Kirra mixed-use precinct

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Castle Hill, the longtime hub of the Hills District, has been one of the major beneficiaries of Sydney's Metro expansion, with improved connectivity helping drive continued population growth, development and buyer demand across the Hills District.

But despite that growth, the suburb has seen relatively few major new apartment projects brought to market over the past 18 months.

Hills District developer Reve Group is looking to fill that gap with <a href="https://www.apartments.com.au/new-apartments/nova-r-ve-castle-hill-2-garthowen-crescent-castle-hill-nsw-2154">Nova Rêve</a>, a major new mixed-use precinct on the corner of Garthowen Crescent and Old Castle Hill Road, a short walk from Castle Hill Metro Station and Castle Towers.

[smartcode_project:default project_id=152737 project_image_fid=377679]

The project will comprise three residential towers alongside a hotel, restaurants, cafes and a skybar, more than 1,600 sqm of ground-floor retail and almost an acre of landscaped gardens.

It represents the largest project undertaken by Reve Group, the development arm of the Kassis family, which has been building across the Hills District for more than 30 years through Kassis Homes.

[smartcode_project:default project_id=152737 project_image_fid=377675]

Nova Rêve also represents a significant step up from the family's first apartment development, Grand Rêve, which was delivered nearby on Garthowen Crescent.

Grand Rêve introduced larger, house-like apartment layouts and premium inclusions including Wolf and Sub-Zero appliances to the Castle Hill market.

Nova Rêve takes that approach to a precinct scale, combining the residential component with hospitality, retail and substantial public and resident landscaping.

[smartcode_project:default project_id=152737 project_image_fid=377685]

Reve Group Managing Director Sam Kassis said the project reflected the family's three decades of building in the Hills, which has evolved from trophy homes on quarter-acre blocks to larger-scale apartment development.

"Grand Rêve was our first apartment project here and it showed us what this pocket of Castle Hill could be. Nova Rêve is the refinement of that idea: not just apartments, but a place the whole suburb can use," Kassis said.

A key part of that approach is the hotel, which has been designed to operate as an amenity for the wider Castle Hill community rather than solely hotel guests.

It will include restaurants, cafes, skybars and all-day dining, alongside conference and event facilities catering to business functions, community groups and private events.

At ground level, more than 1,600 sqm of shops and cafes will open onto the surrounding streets and landscaped areas.

Almost an acre of gardens designed by Land and Form Studios will run through the precinct, incorporating pathways, seating, barbecue areas and children's play spaces.

[smartcode_project:default project_id=152737 project_image_fid=377680]

Reve Group's Romio Georges said creating an active ground plane had been central to the planning of Nova Rêve.

"There are gardens with pathways, barbecues, seating and play areas, shops and cafes opening onto the street, and a hotel with restaurants and a skybar that anyone in Castle Hill can walk into," Georges said.

The project's elevated position on one of Sydney's highest ridgelines will also provide apartments with outlooks toward the Sydney skyline, surrounding parkland and the Blue Mountains.

More than 80 per cent of the apartments will occupy corner positions, with Turner responsible for both the architecture and interiors.

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[smartcode_project_cta:default project_id=152737]

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Larry Schlesinger

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