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As we look to what's ahead for 2012, Property Observer is republishing some of our most noteworthy stories of 2011.
 
Property developer Stockland will invest close to half a billion dollars in new-style retail centres in regional areas designed to combat the threat of online shopping.
Rather than focus on metro areas, Stockland CEO Matthew Quinn says the company sees strong growth potential in regional areas such as Townsville, the Latrobe Valley and Gladstone.
“We are big fans of very good centres in regional cities. We understand these markets,” Quinn told Property Observer during the company’s annual results media briefing.
He highlighted its $100 million shopping centre in Rockhampton in Central Queensland, which has delivered significant value and has performed well above expectations.
“The quality was well above what consumers expected,” he says.
Stockland will build smaller shopping centres, as Quinn says a reduction in the amount of retail space per capita will act as a “natural shock absorber” to increasing online sales.
It forecasts retail space per capita to shrink from two square metres currently to 1.8 square metres by 2020.
Stockland says its retail centres will act as a social and community hub and are more resilient to market downturn and the online threat.
The focus will be on day-to-day value convenience and attracting people to the centres rather than just to the shops themselves.
Centres will feature a higher proportion of food, leisure, retail services and entertainment offerings.
Research by Stockland and Quantium shows that higher end of fashion is more exposed to online sales and the focus will be on securing tenants in the “value to mid-end” retailing range.
Stockland’s $330 million redevelopment of the Shellharbour centre in the Illawarra will include 220 speciality stores.
The reweighting in retail property will be funded partly by $308 million of apartment sales, and a further $73 million under contract.
Quinn says based on extensive research of retail activity in partnership with Quantium, Stockland expects the proportion of online sales to increase (currently about 5%) but the rise will not be as dramatic as some are forecasting.
Annual results for 2011 revealed that Stockland’s retail assets were the strongest performing of its commercial assets, delivering an 8% increase in net operating income of $286 million compared with a 5% drop income from its office portfolio ($183 million). Industrial properties delivered a 3% increase in income to $77 million.
Quinn says the development pipeline is flexible and can be put on hold should conditions deteriorate.
 
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Stockland plans smaller, regional shopping centres to combat online threat

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Some of the biggest stocks in the Australian listed property sector rebounded strongly yesterday after taking a pounding earlier in the week.
On Tuesday the S&amp;P ASX 200 A-REIT index regained 1.29% of its value, having plummeted by 3.1% on Monday.
Westfield Group, which touched a low of $7.52, closed at $7.79 last night. The stock accounts for more than a quarter of the market capitalisation of the $75 billion A-REITs sector.
Retail A-REITs are proving particurlarly resilient.
Westfield’s Australian and New Zealand shopping centre spin-off, Westfield Retail Trust, is trading up from around the $2.20 mark to $2.39 at close of trading yesterday.
CFS is also trading strongly, with the share price at $1.60 up from $1.50.
And the Charter Hall Retail Trust is heading back towards $3 a share, closing at $2.96 yesterday up from a monthly low of $2.73.
Stockland, which today revealed a 57% increase in statutory profit for the 2011 financial year, has also seen its share price turn around in the last few days and closed yesterday at $2.78 having traded around $2.70.
Analysts say sentiment towards A-REITs is improving, with companies now taking a more risk-averse approach.
Gearing ratios at the biggest REITs have fallen from about 35% in 2007 just before the onset of the GFC to about 25%, while secondary REITs’ debt-to-equity ratios have fallen from 45% to 35% over the same period.
The Stockland results revealed a debt-to-equity ratio of just 22%.
Morgan Stanley is forecasting 4.8% growth for A-REITs in 2011, and Russell Investments says there will be modest growth in 2012.
Laura Cummins, a research analyst at Cushman &amp; Wakefield, told Property Observer that A-REITs had learnt the lessons of the GFC.
“Senior management is most concerned with stability and security.  Lessons surrounding the increased availability of debt appear to have been learnt.
“A-REITs have changed their policies to allow distributions to be paid from only cash profits instead of shifts in asset valuations. Capital management is of paramount importance and long-term sustainability is the new black,” she says.
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A-REITs bounce back after fall

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Melbourne is the most active commercial market in Australia and the most attractive to offshore investors, according to data compiled by global research house Real Capital Analytics.
RCA estimates that commercial property sales in Australia jumped 127% over the quarter to reach $4.35 billion, with offshore buyers accounting for 42% of the investment capital.
More than half of this investor money has flowed into Melbourne.
According to RCA, the Victorian capital has generated the most deals in offices, hotels and retail sites activity over the past 12 month, while Sydney had a marginally more active industrial market.
RCA calculates that Melbourne has generated $2.56 billion worth of office deals during the past 12 months, compared with $2.46 billion in Sydney and $1.58 billion in Brisbane.
Melbourne is significantly ahead in retail, with deals totalling $1.87 billion over the past 12 months compared with less than $1 billion in Sydney.
And following the sales of major CBD hotels this year, Melbourne has generated $492 million worth of sales in the leisure sector, compared with $394 million generated across all other major markets.
The Sydney industrial market (primarily the outer-western Sydney suburbs) has generated sales of $591 million during the last 12 months, compared with $492 million in Melbourne and $394 million in Brisbane.
Value of commercial activity over the last 12 months
<table cellpadding="0" cellspacing="0" border="1"><tbody>
<tr>
<td valign="top" width="92">
Offices
</td>
<td valign="top" width="70">
Value
</td>
<td valign="top" width="92">
Retail
</td>
<td valign="top" width="70">
Value
</td>
<td valign="top" width="89">
Hotels
</td>
<td valign="top" width="65">
Value
</td>
<td valign="top" width="84">
Industrial
</td>
<td valign="top" width="55">
Value
</td>
</tr>
<tr>
<td valign="top" width="92">
Melbourne
</td>
<td valign="top" width="70">
$2.56 bn
</td>
<td valign="top" width="92">
Melbourne
</td>
<td valign="top" width="70">
$1.87 m
</td>
<td valign="top" width="89">
Melbourne
</td>
<td valign="top" width="65">
$492 m
</td>
<td valign="top" width="84">
Sydney
</td>
<td valign="top" width="55">
$591 m
</td>
</tr>
<tr>
<td valign="top" width="92">
Sydney
</td>
<td valign="top" width="70">
$2.46 bn
</td>
<td valign="top" width="92">
Sydney
</td>
<td valign="top" width="70">
$886 m
</td>
<td valign="top" width="89">
All other
</td>
<td valign="top" width="65">
$394 m
</td>
<td valign="top" width="84">
Melbourne
</td>
<td valign="top" width="55">
$492 m
</td>
</tr>
<tr>
<td valign="top" width="92">
Brisbane
</td>
<td valign="top" width="70">
$1.58 bn
</td>
<td valign="top" width="92">
Brisbane
</td>
<td valign="top" width="70">
$197 m
</td>
<td valign="top" width="89">
 
</td>
<td valign="top" width="65">
 
</td>
<td valign="top" width="84">
Brisbane
</td>
<td valign="top" width="55">
$394 m
</td>
</tr>
</tbody></table>
Source: RCA
According to the research group, offshore funds have been attracted to Australian commercial markets by traditionally higher yields – averaging 8.3% over the quarter – with Singapore investors particurlarly active in Victoria, Queensland and NSW.
Recent noteworthy sales include 469 La Trobe Street, comprising 20,000 square metres of office space, acquired by CIMB TrustCapital Singapore for $84 million in April.
In January Singapore investor Michael Kum added the one-year-old 275-room Travelodge in Melbourne’s Docklands to his hotel portfolio in February for a reported $54 million.
Colliers national director of institutional investment Jon Chomley told AFR offshore buyers were replacing A-REITs as buyers of commercial property.
Chomley says offshore investors are looking for stable economies with good prospects to invest their funds.
Investors view Australia’s commercial sector as an attractive market despite the high Australian dollar and high interest rates.
Furthermore, the Japanese disaster combined with commercial markets in Hong Kong and Singapore at cyclical highs have also contributed to offshore funds flowing into Australian markets rather than to other markets in the Asia Pacific region.
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Melbourne leads commercial boom as foreign investors step in

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{yoogallery src=[images/stories/august10darlinghurst]}
Local Darlinghurst restaurateurs and retail investors with at least $2 million to spare are being approached as potential buyers of four shops in a new retail precinct being developed in the inner-city suburb. 
The four retail sites range in size from 160 square metres to 280 square metres and are located on the high-traffic corners of Forbes and Burton streets, and Bourke and Burton streets in the heart of Darlinghurst. They are each being marketed with $2 million-plus hopes.
They are part of the $150 million 4,500-square-metre mixed-use development called Dominion being developed jointly by St Hilliers and Cbus Property, due to be completed by the end of 2012. 
The retail sites are being sold by Jonathan Wilmot and Paul Wong of Wilmot Retail Property Services. 
Wong says he is in discussions with several Sydney restaurant owners as either owner-occupiers or investors. 
“Big restaurants are our first port of call,” Wong says. 
He says there is a lot of retail on the market in the area, but none that is brand-new. “It’s quite a unique opportunity.” 
The north-facing retail spaces described as “classically contemporary” are expected to draw strong trade day and night. 
They are surrounded by densely populated affluent inner-city neighbourhoods, established restaurants, cafes, boutiques and galleries. 
Dominion Retail is adjacent to The National Art School and within 100 metres of St Vincents Hospital, Taylor’s Square and Oxford Street. 
Jonathan Wilmot believes the high-visibility spaces would be ideal for cafes, delis, bars and food service operations. 
Successful nearby restaurants include Christine Manfield’s Universal, Lucio Pizzeria, Verde Restaurant &amp; Bar, La Brasserie and The Balkan. 
“Darlinghurst already has a thriving food and bar scene, but it will get a further boost when the lifestyle-savvy residents move into Dominion,” Wong says.
“These very limited retail spaces are in a brand-new, high-quality residential complex and represent a ‘blank canvas’ opportunity for a sophisticated food and beverage professional.”
Besides being suitable for eateries, the spaces are also being targeted at sites for a beauty salon, spa, art gallery, design studio, or even a boutique office.
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Restaurateurs sought for $2 million Darlinghurst offerings

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The Mortgage and Finance Association of Australia says it supports draft legislation designed to offer better protection for senior Australians who use reverse mortgages to access the equity built up in their homes.
“We’ve been very much involved in the working group which was responsible for the changes announced.  We support them,” MFAA chief executive Phil Naylor has told Property Observer
Naylor says the proposals, released over the weekend by assistant treasurer Bill Shorten, are generally consistent with the code of practice set by SEQUAL, the industry body representing lenders who offer reverse mortgages.
The draft legislation offers statutory protection against the risk of negative equity, restricting lenders from asking seniors to pay more than the value of their home when it is sold.
The SEQUAL code of conduct requires that “all products carry a clear and transparent ‘no negative equity’ or ‘non-recourse’ guarantee. That is, the customer(s) will never owe more than the net realisable value of their property, provided the terms and conditions of the loan have been met.”
Members of SEQUAL include the Commonwealth Bank, BankWest, St George and Suncorp, which all offer reverse mortgage products.
The other key facets of the draft legislation are:
<ul>
<li>Better disclosure of the financial consequences of entering into these types of contracts, so that seniors can better assess how accessing credit can reduce equity in their homes and limit their choices in the future 
</li>
<li>New requirements on lenders before they act on a default – including an obligation to take reasonable steps to contact borrowers in person, make sure they understand they are in default and provide borrowers with an opportunity to rectify the default.</li>
</ul>
Reverse mortgages are typically offered to home owners aged over 60 and allow them to borrow money against the equity in their home, in return for a lump sum, line of credit or regular payment.  The debt does not need to be repaid until the home is sold (usually when the borrower dies or voluntarily vacates the home), with interest compounding until that time.
The market has grown strongly in Australia over the last five years.
Research by Deloitte and SEQUAL, the industry body representing lenders who offer the products, found that the total value of reverse mortgages reached $3 billion by December 2010.
About 5,600 seniors took out a reverse mortgage in 2010, with the total number of loans rising to 41,600.
<img src="/images/stories/reverse.jpg">
"Many senior Australians have worked hard to own their own home before retirement, and if they need to use credit to access the equity in their home then they deserve to be adequately protected," Shorten says.
"These measures deliver a new level of protection for seniors who take out reverse mortgages.  Reverse mortgages are different from other credit products and it is important the law takes into account their unique characteristics. With these new measures, older Australians can have greater confidence when using these products, and will be able to make better choices."
Older Australians, lenders who offer the products and other stakeholders have until August 17 to comment on the draft legislation.
Reform of reverse mortgages will be included in the National Consumer Credit Protection Act 2009.
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Government to offer seniors reverse mortgage protection

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The property market in one of Australia’s most remote towns appears to be turning around, if you believe figures put out by the Real Estate Institute of Western Australia. 
The institute says the median house price in Broome, 2,200 kilometres north of Perth, increased by 6% over the June quarter of 2011. 
In comparison, Perth house prices fell 3% over the quarter, the fifth consecutive quarterly contraction. Houses are now selling at the pre-GFC level of about $475,000, a fall of 6% from the March 2010 peak of $505,000. 
Broome’s performance in the June quarter not only stands out in stark contrast to Perth, but is a significant turnaround on the regional market’s performance earlier this year. 
In the March quarter, Broome house prices fell by 9.1% and were down 11.8% compared with a year prior, according to Real Estate Institute of Australia figures, with houses selling in a wide range between $533,000 and $700,000. 
More recent data compiled by Australian Property Investor shows Broome house prices down 8.1% for the three months to April 2011 and 15.4% over the 12-month period, with a median house price of $533,000, median weekly rent of $565 and a yield of 4.5%. 
Broome is most famous for its pearls, the white sands of 22-kilometre long cable beach and as a tourist destination. It has a resident population of about 15,000. 
Despite its remoteness, Broome can be reached by air from most capital cities and is connected by road via the Great Northern Highway and the North West Coastal Highway. 
Graham McGinn of Hutchinson Real Estate says prices in Broome are showing some signs of firming, with the rental market still very strong. 
“There is some upward pressure on rents,” he says.
McGinn says that in the past Broome has been very attractive due to its rental return, but investors are now conspicuous by their absence. 
“Most buyers are owner-occupiers,” he says. 
“We still get sea changers coming to Broome. People who are travelling around Australia stop and have a look around. If they like it, some come back and buy.” 
“They come for the beach lifestyle, though it gets pretty hot during the wet season which runs from November to March,” he says. 
He describes the most recent wet season as “fantastic”, which may have played a factor in the recent uptick in Broome prices over the quarter. 
McGinn says vendors currently have to discount their properties anywhere between 4% and 8% of the asking price. 
Recently, gas giant Woodside received state approval for its controversial $30 billion Kimberley LNG hub at James Price Point. 
McGinn says it the project will have some impact. 
Allan Griffiths, principal at First National Real Estate Broome, is also hopeful the project will give a boost to Broome property prices. 
He questions the latest REIWA figures and says the market is “fairly flat”. 
“The increase is coming from low base of turnover,” he says, adding that the median price might have been given a boost by the recent sale of a house at Sunset Park near Cable Beach for around $1.35 million. 
“The market is very selective. We won’t list properties that are overpriced.” 
“There is ample supply and limited demand. There have been no investors in the market for some time,” he says. 
State government land developer LandCorp has recently released a large quantity of land into the market. 
Two key developments include Broome North, which will ultimately be home to up to 13,000 people, and the 35-hectare Januburu Six Seasons estate, which will eventually accommodate 345 homes across single residential and group housing lots. 
However, Griffiths says it’s cheaper to buy an established house in Broome than buy land and build on it</body></html>

Hotspots: Broome market turning around

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The Commonwealth Bank has hiked its fixed rate home loans by up to 60 basis points, one of the biggest increases of the year.
The Commonwealth Bank said the move was to ensure it "continue[d] to meet our regulatory requirements".
Fixed rates for one- to five-year products will range from 6.59% to 6.99%.
The CBA’s three-year fixed rate loan – traditionally the most popular fixed-rate loan type – has been raised by 40 basis points from 6.99% to 6.59%
Ross McEwan, group executive of retail banking services at the Commonwealth Bank, says: “Many customers want certainty with their home loan repayments, and we are pleased to take a lead and offer customers that peace of mind.”
However, fixed-rate customers might not feel that pleased should the RBA take drastic action in September and cut interest rates, as some economists predict might happen if the global situation worsens.
The CBA move follows ANZ cutting its fixed rate mortgages by between five and 15 basis points on August 1 along with Newcastle Permanent cutting its fixed rates by up to 10 basis points.
In June, Mortgage Choice recorded demand for fixed rates rising to 13.3% of all loan approvals compared to a 12 month average of 10.45% and up from 12.3% in May.
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Commonwealth Bank cuts fixed home loan rates

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June housing finance data failed to deliver a fillip to the property market, with fewer first-time buyers and the total value of mortgages declining.
According to the Australian Bureau of Statistics, the number of first home buyer commitments as a percentage of total owner-occupied housing finance commitments fell from 15.4% in May 2011 to 15.2% in June 2011, with the average loan size for first home buyers falling $6,000 to $280,200.
The average loan size for all owner occupied housing commitments increased fractionally – up $900 to $288,100 for the same period.
On a seasonally adjusted basis, the total value of mortgages declined by 1.4% in June to $20.18 billion.
“New home lending is a leading indicator of residential building activity so unfortunately the current low number of loans reinforces HIA’s view that dwelling starts will fall by at least 14% in calendar year 2011,” says HIA senior economist Andrew Harvey.
“This low level of residential building activity is not only a negative for the Australian economy, but is not sustainable in a market which already poses major home affordability challenges, particularly for first-time buyers.”
<img src="/images/stories/absaugust9.jpg">
Source: HIA
Banks were the only ones to benefit over the month, with lending volumes rising by 0.2% over June with non-banks suffering a 1.1% drop and permanent building societies a 0.9% fall.
The banking sector's share of total mortgage approvals increased to 92.5% in June (up from 92.4% in May), to be at the highest share since March 2009. This reflects both a solid increase in bank-sourced housing finance (10.2% higher since February 2011) and weakness in housing finance from non-banks which is now at its lowest level since November 2008
The combined bank loan book now total just over $1 trillion dollars comprising $724 billion worth of owner occupier loans and $318 billion worth of investment loans.
The number of commitments for owner occupied housing finance was flat with 49,175 mortgages arranged over the month.
The continuing struggles of the construction sector were reflected in stagnant construction loan figures, down 0.8% to $4.8 billion.
Investment housing fixed loans decreased by 4.4% over June to $6.06 billion.
Westpac notes the housing finance to owner-occupiers was flat in June, but was in line with expectations.
It notes the level of housing finance to owner-occupiers remained relatively subdued, with the sector facing “a number of headwinds.”
The detailed data for owner-occupier finance was mixed, with Westpac noting new lending (i.e., ex-refinancing) was a little stronger, but finance for the construction of new dwellings edged lower.
Queensland continued to disappoint, Westpac notes.
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First-home buyers and mortgage numbers down, but banks boost their dominance

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Inner-Sydney median rents have increased by $40 per week over the past year, outpacing a $30 per week increase across the city, according to the latest NSW government’s rent and sales report for the June quarter.
Over the course of the year, the median rent increased by $10 a week to $440 in the middle ring and by $5 per week to $380 in the outer ring.
<img src="/images/stories/sydneyrentsaugust9.jpg">
The biggest annual increase in the inner ring across all property types occurred in<a target="_blank" title="Botany Bay" href="/news"> Botany Bay</a>, where rents for three-bedroom dwellings increased by 16.6% over the year to a median weekly rent of $650.
Eastern suburbs accounted for many of the biggest increases of the year, with two-bedroom dwellings in <a target="_blank" title="Waverley" href="/news">Waverley</a> increasing by 11% over the year to a weekly median rent of $600.
A three-bedroom pad in Woollahra will cost about $1,100 a week to rent – the most expensive in Sydney – following a 12.8% increase over the year to June. Three-bedroom dwelling rents in Woollahra increased by 12.2% over the June quarter alone.
The Sydney CBD remains the most expensive place to rent a one-bedroom apartment, with median weekly rent rising 11.1% over the year to $500 a week.
The inner-western suburbs of <a target="_blank" title="Marrickville" href="/news">Marrickville </a>and <a target="_blank" title="Ashfield" href="/news">Ashfield </a>remain the cheapest inner-city suburbs to rent a one-bedroom apartment, with weekly median rents of $350, despite increases over almost 10% for both suburbs over the past year.
<a target="_blank" title="Mosman" href="/news">Mosman </a>on the North Shore is the only inner city suburb to record a drop in the median rent for one-bedroom apartments. Rents are down 1.3% on the year to $395.
Among the most popular rental category – two-bedroom flats – the largest annual increases in median rent were recorded in <a target="_blank" title="Waverley" href="/news">Waverley </a>in the inner east (14.3% to $600 per week), and in the outer-western suburbs of <a target="_blank" title="Campbelltown" href="/news">Campbelltown</a> (13% to $260), and <a target="_blank" title="Baulkham Hills" href="/news">Baulkham Hills</a> (12.2% to $460).
Outside of Sydney the biggest increase in median weekly rents for two-bedroom apartments occurred in Lake Macquarie, with rents up 16.7% over the year to a median price of $280 per week. 
In the three-bedroom category, Lane Cove, Mosman, Randwick all recorded rental increases above 10%.
Outside of the Sydney metro area, Hunters Hill (13.4%) in the middle ring, Wollondilly (16.7%) in the outer ring and Cessnock (10.1%), Maitland (10%) and Wollongong (14.3%) in the greater metropolitan region generated rental increases of greater than 10% for the year for all dwellings.
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Inner-Sydney rents up $40 a week over the past year

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Borrowers can be forgiven for being confused about the direction of interest rates over the past five weeks. Property Observer has compiled the top 10 defining economist announcements since the RBA's July decision to keep interest rates on hold: 
<h1 align="center">1 </h1>
July 5 Rates on hold for rest of 2011: ANZ
Following the RBA’s decision to leave rates on hold on July 5, ANZ forecast rates to be on hold for the rest of 2011 but also estimated a “more gradual tightening cycle, with the cash rate to reach 5.75% in the second half 2013".
<h1 align="center">2</h1>
July 5 A rate hike in November: Westpac
“We see the first possible window for a hike as the November meeting. That would require an improvement in consumer spending and more clarity on the situation in Europe,” Westpac forecast on July 5. 
<h1 align="center">3</h1>
July 12 A 25 basis point rise in December: NAB
On July 12, NAB said the next 25 basis point rise would be deferred until December, “when growth momentum is more apparent and labour market tightens significantly”. The bank put a second 25-basis-point rise back to May 2012.
<h1 align="center">4</h1>
July 15 Rates to fall in October: Westpac
On the back of “further adverse developments in Europe” Westpac changed its minds on rates, forecasting a 25 bps rate cut by October and 50% chance of a follow-on move by February next year.
<h1 align="center">5</h1>
July 21 Rates down by 1% by late 2012: Westpac
Following publication of its Red Book, Westpac said the RBA would move to an easing bias in the months ahead before delivering a series of rate cuts from December with a 1% reduction by late 2012.
 
<h1 align="center">6</h1>
July 27 Rise of 25 bps before the end of 2011: ANZ
Following the release of higher-than-expected quarterly CPI figures for June, ANZ said a 25bps interest rate rise before the end of the year was very likely.
<h1 align="center">7</h1>
July 27 No rate hike in August: Westpac
Following its bold declaration that rates would fall, Westpac had a go at the method the ABS used to compile its inflation data – “We note with relief that the ABS plans to change this troublesome sub-component from the CPI from the September quarter” – but became a lot more cautious about future rate cuts.
<h1 align="center">8</h1>
July 29 Rates up in fourth quarter to 5%, peaking at 5.75% by mid-2013: CBA 
“We do expect the RBA to lift the cash rate to 5% at the November board meeting after the release of the third-quarter CPI in late October, which is likely to confirm intensifying underlying inflation pressures. We then see the RBA gradually lifting the cash rate to a likely peak of 5.75% by early 2013," said Commonwealth Bank of Australia. 
<h1 align="center">9</h1>
August 2 Rates going down in November: Westpac
Following the RBA's August 2 decision to leave rates on hold, Westpac declared: “Given our view that the global economy is likely to remain a risky place and that inflation pressures will continue to ease in the Australian economy, we see no reason to change our forecast that the next move in rates will be down by late in 2011.”
 
<h1 align="center">10</h1>
August 8 Emergency rate cuts possible: ANZ
Following S&amp;P’s US downgrade and global equity markets crashing, ANZ warned that a further sharp decline in equity markets would increase the risk of the RBA enacting “emergency rate cuts”. However, should international markets stabilise the bank says the RBA thinking would “reverse toward higher interest rates once more”.
Rismark economist Christopher Joye wrote on his <a target="_blank" title="Christopher Joye" href="https://christopherjoye.blogspot.com/2011/08/calm-pays-during-chaos">macroeconomic blog</a> that he remained of the view that interest rates werelikely to go up rather than down. However, he noted the possibility of the RBA doing a 180-degree spin if the crisis worsened, with interest rate markets pricing in potential for six rate cuts between now and March next year.
<a title="Click to enlarge" rel="shadowbox" href="/images/stories/joyeaugust83.gif"><img src="/images/stories/joyeaugust83thumb.gif"></a>
Click to enlarge
Source: Christopher Joye
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Ten twists and turns: The interest rate forecast rollercoaster

Sydney developer&nbsp;<a href="https://www.apartments.com.au/developers/central-element">Central Element</a>&nbsp;is doubling down in Drummoyne, lodging plans for a boutique apartment development on St Georges Crescent, only one-kilometre down the road from its first Drummoyne development, Bianca.

The new project at 15A-21 St Georges Crescent,&nbsp;a&nbsp;1,701sqm north-facing site overlooking Iron Cove, will have 45 apartmnts across 10 levels. Eight of the units will be dedicated to affordable housing.

The site sits within walking distance of Drummoyne Village, Birkenhead Point, ferry services and the Bay Run, and offers harbour views towards the Sydney Harbour Bridge and CBD skyline.

Designed by MHN Design Union, the development will deliver a mix of one, two and three-bedroom apartments, alongside resident amenity including a gym, landscaped communal open space and three levels of basement parking.

The project has been lodged under the NSW Government's Low and Mid-Rise Housing reforms, with Drummoyne Village identified as a town centre capable of accommodating additional housing supply.

Central Element acquired the site earlier this year as part of its continued expansion across Sydney's eastern suburbs, lower north shore and inner west.

The developer's current pipeline includes luxury apartment projects Pearl Bondi and a separate development on Lamrock Avenue in Bondi, a residential project in Barry Street, Neutral Bay, and a mixed-use seniors living community in Greenwich.

Central Element Managing Director Nathan Chivas said the project would address a shortage of new owner-occupier housing opportunities in Drummoyne.

"While we're seeing a significant shift across Canada Bay as major infrastructure investment, population growth and planning reform drive a new chapter for the region, in suburbs like Drummoyne there remains a genuine shortage of new boutique luxury housing opportunities for owner occupiers," Chivas said.

"Sites of this nature are increasingly difficult to secure, particularly those that combine a north-facing aspect with direct water outlook. Our St Georges Crescent project responds directly to the market demand, offering a level of exclusivity, outlook and lifestyle in the highly sought after suburb."

The development application has been lodged with the City of Canada Bay Council, with the project expected to launch to market in early 2027.

&nbsp;

Joel Robinson

Central Element seeks second Drummoyne apartment development

The NSW Government has unveiled plans that could deliver around 1,300 new homes across Nowra and Kiama, continuing its push to unlock housing in well-located regional centres along the South Coast.

The proposals, now on public exhibition, would pave the way for around 830 homes in Nowra and a further 450 homes in Kiama, while also introducing affordable housing requirements and increased building heights in key locations.

The larger of the two proposals is centred on Nowra, where the NSW Government is seeking to rezone land within the Mandalay and Riverfront precincts.

The Mandalay sub-precinct, located close to Shoalhaven Memorial Hospital, Nowra Library and the city's aquatic centre, could accommodate around 530 new homes. Around 30 per cent of housing delivered on Homes NSW-owned land would be dedicated to social and affordable housing, equating to roughly 100 homes. Building heights would increase from the current two-storey limit to between three and six storeys.

A separate rezoning proposal for the Nowra Riverfront Precinct would unlock a further 377 homes while creating stronger connections between the Shoalhaven River and the CBD. The plans include building heights ranging from five to 12 storeys, floor space ratios of up to 2:1 and a requirement for two per cent affordable housing.

Together, the two proposals would deliver more than 900 homes across the broader Nowra area, reinforcing the city's role as one of regional NSW's key growth centres.

The housing push builds on previous infrastructure commitments in the Shoalhaven, including government funding aimed at supporting thousands of future homes in West Nowra through upgrades to water and wastewater infrastructure.

Further north, the NSW Government is also progressing plans for the former Kiama Depot site, a two-hectare parcel near Kiama's town centre.

The rezoning proposal would transform the former industrial site into a residential community capable of delivering up to 450 homes. Buildings would range between six and eight storeys, with at least 10 per cent of homes allocated as affordable housing. The proposal also includes approximately 600 parking spaces and improved walking and cycling connections.

Planning Minister Paul Scully said the proposals are designed to increase housing supply in locations close to jobs, transport and services.

"For too long, families have struggled to find somewhere to live, and activating underutilised sites allows us to deliver the new homes these families need," Scully said.

"The Minns Labor Government is getting on with the job of unlocking well-located sites close to transport, jobs, and town centres and building the homes our communities need.

"These rezonings are about removing barriers to housing delivery and making sure land is put to better use so more people can find a place to call home within the communities they choose."

The latest rezonings form part of the Minns Government's broader strategy to accelerate housing delivery across NSW, particularly in established centres where existing infrastructure can support additional population growth.

Community consultation on the proposals is now underway, with feedback set to inform the final planning controls before the rezonings are determined.

Around 1,300 new homes earmarked for Nowra and Kiama as NSW Government pushes housing supply

<a href="https://www.apartments.com.au/developers/mrcb">MRCB International</a> has commenced construction on its latest Gold Coast apartment development, Maris, on the site of the former Sundale Motel in Southport.

The start of construction by <a href="https://www.apartments.com.au/builders/binah-constructions">Binah</a> follows an exceptionally strong sales campaign, with more than 90 per cent of apartments sold since launch. Every purchaser has been local, an&nbsp;indicator of confidence in both the development and Southport's evolution into a thriving CBD.

<a href="https://www.apartments.com.au/new-apartments/maris-southport-20-queen-street-southport-qld-4215">Maris</a> will deliver 192 residences across 20 levels. The project forms part of MRCB's Australian and New Zealand development pipeline now exceeding $1.6 billion in gross development value, alongside a growing portfolio of projects globally.

[smartcode_project:default project_id=134403 project_image_fid=350663]

The company also commenced construction on its $600 million 26 Vista residences in Surfers Paradise last year, following strong sales momentum, with over 70 per cent of residences sold.

Maris has been designed to meet evolving buyer demand, offering architecturally designed layouts suited to long-term liveability. The approach reflects a growing preference for quality and adaptability among Gold Coast buyers.

Positioned next to the Broadwater in the <a href="https://www.apartments.com.au/developments/southport-qld-4215">Southport</a> CBD, Maris sits directly opposite the Broadwater Parklands light rail station and within easy reach of retail, dining and lifestyle precincts, placing residents at the centre of one of the Gold Coast's most connected and rapidly maturing urban centres.

[smartcode_project:default project_id=134403 project_image_fid=372756]

Maris will offer a full suite of resort-style residential amenities, including a pool, gym and sauna, along with a rooftop level featuring decks, lounges and dining and yoga areas that command sweeping views across the Broadwater and out to the ocean.

Binah, a New South Wales headquartered company co-founded by Amen Zoabi and Khalil Hafza in 2008, has expressed its excitement at establishing its first partnership with MRCB.

Binah's Managing Director Khalil Hafza said partnering with MRCB on Maris is a significant moment for Binah.

"MRCB's financial strength and a track record that speaks for itself give this project a solid foundation, and this marks the beginning of what will be a long and successful relationship.

"With the right people, systems and partnerships behind it, Maris is set to become a significant addition to the Gold Coast's premium residential market."

[smartcode_project:default project_id=134403 project_image_fid=350664]

MRCB International CEO Ravi Krishnan said the project's progression to construction reflects both sustained demand and tightening conditions across the apartment sector, as well as MRCB's continued confidence in the Gold Coast market.

"Commencing construction at Maris is a significant step and reflects the depth of demand for quality apartments in well-connected urban locations," said Krishnan.

"Across Southeast Queensland, new apartment supply remains constrained, particularly in established precincts with infrastructure and amenity already in place. Projects like Maris are increasingly critical in meeting that demand, especially on the Gold Coast and in the city's CBD precinct."

[smartcode_project:default project_id=134403 project_image_fid=372761]

Krishnan said Southport's ongoing transformation, supported by infrastructure investment and long-term planning, was underpinning renewed buyer confidence.

"We're seeing a clear shift back towards well-located urban centres where infrastructure, connectivity and amenity are already established," said Mr Krishnan. "Southport is evolving into a more mature CBD environment, and that is being reflected in buyer behaviour."

Construction at Maris is anticipated to be completed in 2029.

[smartcode_project_cta:default project_id=134403]

Construction commences on MRCB’s $200m Maris Residences in Southport

Moonee Valley Park’s latest residential release <a href="https://www.apartments.com.au/new-apartments/the-eveline-at-moonee-valley-park-moonee-ponds-100-thomas-street-moonee-ponds-vic-3039">The Eveline</a>, has achieved a new benchmark for off-the-plan apartment sales in the suburb, with the sale of The Alexandra penthouse selling for $5,435,000.

Positioned on the top floor of a 16-level residential building, the three-bedroom, three and-a-half-bathroom penthouse features uninterrupted city skyline views across the future Valley racetrack.&nbsp;

The landmark sale comes as momentum at the precinct continues to build, with the Moonee Valley Racing Club progressing works on its new racetrack ahead of the 2027 Cox Plate. The transformative development will see MVRC reimagine the beloved Valley as a vibrant year-round entertainment and lifestyle destination.

Alongside a world-class racing experience, the historic precinct will be activated with events, hospitality and public green spaces designed to attract broader audiences, while breathing new life into one of Melbourne’s most iconic destinations.&nbsp;

[smartcode_project:default project_id=142519 project_image_fid=372786]

Development partners <a href="https://www.apartments.com.au/developers/hamton">Hamton Property Group</a> and Hostplus have delivered five residential stages over the past four years, the most recent in November 2025 with Trackside House and Stonepine House. The flourishing community is now home to almost 500 families.&nbsp;

The latest residential release, The Eveline, has recorded strong demand since launching publicly last July, securing more than $200 million in sales to date, satisfying its pre sales hurdle for construction to commence.&nbsp;

Hamton Founder and Executive Chairman, Paul Hameister OAM said, the sales&nbsp;team have been overwhelmed by demand for these unique homes in this unique project.

"Buyers continue to be predominantly hyperlocal and attracted by the 40 hectare botanic masterplan in Melbourne’s inner north west," Hameister said.

[smartcode_project:default project_id=142519 project_image_fid=372788]

Hamton’s Sales and Marketing Director Fergus Humphries said the team has achieved more than 70 sales over the past eight weeks, including the penthouse purchase by a local buyer.

"These results reinforce that, even in a challenging market, purchasers continue to be drawn to quality projects that offer more than just a home, they offer a lifestyle.”

Designed by Cera Stribley, the penthouse has been created with entertaining in mind, spanning close to 400 sqm of indoor and outdoor living space, including multiple terraces designed to capture sweeping views across Melbourne’s skyline, the new Valley racecourse and sunset views over Moonee Ponds.

Moonee Valley Park is one of Melbourne’s largest urban renewal projects, transforming the iconic racecourse site into a vibrant mixed-use neighbourhood integrating homes, parklands, retail, racing and community amenities.

[smartcode_project_cta:default project_id=142519]

Moonee Valley Park penthouse sets suburb record as sales surge clears construction benchmark

A company linked to one of Australia's largest privately owned cattle businesses has lodged plans for a new residential tower in <a href="https://www.apartments.com.au/developments/newstead-qld-4006">Newstead</a>, continuing the rapid transformation of one of Brisbane's most sought-after, inner-city precincts.

Bottletree Holdings, an entity associated with Stanbroke Managing Director Brendan Menegazzo, has submitted a development application for a 28-storey mixed-use tower at <a href="https://www.apartments.com.au/new-apartments/9-longland-street-newstead-qld-4006">9 Longland Street</a>, a site that made headlines last year when it changed hands in an off-market transaction that reportedly set a benchmark land rate for the suburb.

The proposal would replace an existing two-storey commercial building on the 1,510 sqm corner site with a Bureau Proberts-designed tower comprising 76 apartments, ground-floor retail, office space and a suite of resident wellness amenities.

<img alt="9 Longland" data-entity-type="file" data-entity-uuid="c710a836-568e-4382-bc91-3c34b8e80a8b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-22%20at%209.41.45%E2%80%AFAM.png?VersionId=Vy.mQWBc7GA_a.vIBdxKqRC9XGjWalo2" />

According to planning documents lodged with Brisbane City Council, the development would comprise a mix of 36 two-bedroom apartments, 24 three-bedroom apartments and 16 four-bedroom residences, positioning the project firmly at the premium end of the market. The apartments would sit above a podium containing retail and commercial space, with three levels of communal recreation facilities spread throughout the tower. The proposal also includes 198 car spaces and 95 bicycle spaces.

Bureau Proberts has drawn heavily on Newstead's industrial heritage in developing the architectural response.

"Occupying a prominent corner in the heart of Newstead, the proposal draws from the area's industrial lineage of robust brick warehouses to deliver a distinctly contemporary response," the architects said in the design statement.

"It is conceived as a subtropical sanctuary and elevated private retreat embedded within one of Brisbane's most vibrant lifestyle precincts."

The design seeks to reinterpret the traditional Queensland vernacular through wraparound verandahs, deep shading elements and permeable facades that respond to Brisbane's subtropical climate.

<img alt="9 Longland" data-entity-type="file" data-entity-uuid="25524f59-395c-4825-8fad-9b639822fa8a" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-22%20at%209.42.09%E2%80%AFAM.png?VersionId=dlWlbpCc_g3Y6yTLGqRVKvGJvO2ubMJ3" />

Planning documents describe the building as embodying the principles of "buildings that breathe", a design approach increasingly favoured in Brisbane's apartment market as developers focus on natural ventilation and outdoor living spaces.

The tower itself would rise above a heavily landscaped podium designed to reference the woolstore architecture that helped define Newstead and neighbouring Teneriffe for generations. At ground level, fine-grain retail tenancies would activate Longland Street, Wyandra Street and the existing Wyatt Street laneway, further extending the pedestrian network that has become a hallmark of the Gasworks precinct.

The application notes that more than 54 per cent of the site would be dedicated to landscaping and deep planting, while approximately 1,750 sqm of communal recreation space would be delivered across multiple levels.

<img alt="Planning" data-entity-type="file" data-entity-uuid="fed3b189-1054-4b68-af5f-b0befc4a66e5" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-22%20at%209.42.19%E2%80%AFAM.png?VersionId=gqeE3cjsbnLAfeTUKA1HtPZfqDs6S4Xa" />

Bottletree paid $22 million for the 1,510 sqm development site, equating to more than $14,500 per sqm, a reflection of the strong demand for development opportunities in Newstead. The suburb continues to attract both developers and buyers, underpinned by the ongoing evolution of the Gasworks and Teneriffe precincts into some of Brisbane's most sought-after lifestyle destinations.

Brisbane City Council's Sustainable Growth Strategy and Inner City Strategy both identify Newstead as a priority growth precinct capable of accommodating additional housing density due to its proximity to employment hubs, public transport and lifestyle infrastructure.

The proposed tower joins a growing pipeline of high-end apartment developments in the suburb. Fortis recently launched <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a>, a 65-apartment owner-occupier-focused development on Kyabra Street, while Consolidated Properties Group is preparing to launch <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a 227-apartment waterfront project on Skyring Terrace.

Meanwhile, builder-developer BPG is planning its own Newstead project on Maud Street, comprising just over 100 apartments and more than 1,380 sqm of dedicated wellness and resident amenity spaces, further highlighting the shift towards lifestyle-driven apartment developments in Brisbane's inner-city market.

Larry Schlesinger

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