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The unfulfilled dream of countless small business owners is to run an active business through their self-managed super fund (SMSF).
The typical driver is to pay tax at half the corporate rate or no tax once the super fund is in the pension phase.
During his 40-plus years advising SMSFs, Martin Murden has had at least one request a year from fund trustees for advice about whether they can operate a business, such as a corner shop, through a self-managed fund.
But Murden, a director of SMSF consulting and auditing with the Partners Wealth Group, says none of these trustees to his knowledge has gone ahead and operated a business through their SMSF after listening to his warnings.
While Murden says that the law does not, in theory, prohibit SMSFs from running active businesses, various superannuation and trust laws make it highly impractical.
Here are five questions that fund trustees should ask themselves before trying to setup an active business in their SMSFs:
<ol>
<li>
Will your fund still comply with the sole-purpose test if running a business? This is the biggest stumbling block to an SMSF operating an active business. Under the sole purpose test, a super fund must be maintained for the purpose of providing retirement or death benefits to members. Indeed, Stuart Jones, author of the Australian Superannuation Handbook 2014-15, published by Thomson Reuters, writes that the Tax Office, as self-managed super regulator, “generally considers” an SMSF is breaching the sole-purpose test if conducting a business. 
</li>
<li>
Does your SMSF trust deed allow the fund to operate an active business? An SMSF may not be permitted by trust law to carry out a business unless expressly empowered under its trust deed, Jones warns. 
</li>
<li>
Can your SMSF business operate without an overdraft? Murden says the strict limits on borrowing by an SMSF will prevent the fund having an overdraft. SMSF are prohibited from borrowing except in limited circumstances. An SMSF can borrow for up to 90 days to pay a member benefit or to cover the settlement of securities such as shares and bonds. (Such loans must not exceed 10% of a fund’s assets.) 
</li>
<li>
Will your SMSF business have to pay cash for its trading stock? An SMSF is prohibited from lending to members or relatives of members, Murden stresses. 
</li>
<li>
Will your SMSF business employ members or relatives of members? While superannuation law does not prohibit a fund from employing members and relatives, their employment may encourage the Tax Office, as SMSF regulator, to take a closer look.
</li>
</ol>
Jones says the regulator may look at the “stated rationale” for employing family members and at the level of income.
In regard to salaries paid to family members, Murden points to provisions in superannuation law requiring funds to conduct their affairs on an arm’s length, commercial basis.
An inflated salary paid to a family member would also be an issue under the sole-purpose test.
As Murden says, it is common for SME owners to own their business premises through their SMSFs. Business real estate is among the few types of assets that SMSFs are permitted to acquire from their members and other related parties.
And business real estate is one of the few types of assets that funds can lease to related parties – including fund members and their businesses – without a restriction on its value.
However, running an active business through an SMSF is much harder to achieve without breaching superannuation and trust laws.
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
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Five questions you should ask before trying to run a business through an SMSF

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Property spruikers target SMSFs with good reason.
SMSFs often have large amounts of money at their ready disposal with the average fund holding almost $1 million.
Funds also have the ability to borrow to invest.
And significantly, SMSF members –whether as individual trustees or trustee directors if the fund has a corporate trustee– make the investment decisions, including whether to invest in direct property.
ASIC does not want to SMSFs to become the “vehicle of choice for property spruikers”, says the regulator’s deputy chairman Peter Kell.
 
<hr>
 This article is part of Property Observer's <a style="color: #000000; font-size: 15px;" href="http://propertyobserver.com.au/ebooks/free-ebook-21-dos-and-donts-for-smsf-property-investors">free eBook: 21 do’s and don’ts for SMSF property investors</a>.
 
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Don't ignore ASIC warning about property spruikers

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An SMSF can own business property (such as offices, shops and factories) and residential investment property.
However, there are crucial differences between the legal requirements for funds regarding business and residential properties.
Business real estate is among the few types of assets that SMSFs are permitted to acquire from their members and other related parties.
And business real estate is one of the few types of assets that funds can lease to related parties – including fund members and their businesses – without a restriction on its value.
Generally, an SMSF is barred under the in-house asset rules in superannuation law from leasing or having investments with related parties involving assets that are worth more than 5% of the fund’s total market value.
Business property is among the few exceptions to the rule.
SMSFs are prohibited from acquiring residential real estate from related parties– even if the market value is paid.
An SMSF can be the sole owner of a property or hold a property with other investors, commonly using a unit trustor joint-ownership arrangement.
Some SMSFs enter arrangements to hold property with their own membersor with other SMSFs.
This enables the funds to invest in otherwise unaffordable properties.
<hr>
This article is part of the <a style="color: #000000; font-size: 15px;" href="http://propertyobserver.com.au/ebooks/free-ebook-21-dos-and-donts-for-smsf-property-investors">free eBook: 21 do’s and don’ts for SMSF property investors</a>. 
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Do understand what types of property your fund can own

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Just because the law allows investors to do something doesn’t, of course, mean it is a good idea.

This investment adage comes to mind with the recent final ruling from the tax office – in its role as regulator of self-managed super – relating to the acquisition, maintenance and improvement of geared properties in a self-managed super fund (SMSF).
In short, the ruling – clarifying much of the uncertainty about the commissioner’s interpretation of the SMSF gearing laws – is likely to encourage many more SME owners to at least consider holding their business premises in their family super funds.
Property Observer discussed the ruling in detail on June 5, including in regard to the gearing of business premises built over several titles and the <a href="https://www.propertyobserver.com.au/finance/five-strategies-for-investing-in-geared-property-through-an-smsf/2012060655012" target="_blank">undertaking of improvements to business and other properties</a>.
Particularly given the new ruling, it is crucial for business owners to carefully weigh up the advantages and disadvantages of holding their business premises in their SMSFs – whether or not the properties are geared.
The advantages are clear.
Business real estate, such as the premises of a family SMSE, is among the few types of assets that SMSFs are allowed to acquire from their members and other related parties. And business real estate is one of the few types of assets that funds can lease to related parties – including fund members and their businesses – without a limit on its value.
Your business pays a commercial rent to your SMSF. The rent is tax-deductible to your business and your SMSF pays tax at no more than 15% on the rent.
If your fund has borrowed to buy the business premises, the interest is tax-deductible.
Unrivalled asset protection is another advantage. If you later experience financial difficulties, superannuation assets (including business premises) are generally out of the reach of creditors if individual fund members are declared bankrupt – subject to the claw-back provisions in the Bankruptcy Act.
Further, no capital gains tax (CGT) is payable if your fund eventually sells the property when the fund’s assets are backing the payment of a superannuation pension.Bu
Some business owners, however, would tend to concentrate only on the advantages of acquiring their business premises through their SMSFs without giving sufficient attention to the possible disadvantages.
Here are six tough questions to ask yourself:
<h3>1. What happens if my business experiences financial difficulties?</h3>
Family SMSFs sometimes face the difficulty of having a financially-troubled family business – owned by the fund’s members – unable to pay the rent for fund-owned business premises.
Under superannuation law, fund trustees (who are the members themselves) must operate their super fund for the sole purpose of providing member retirement benefits. And that means pursuing a tenant for unpaid rent – even if that wayward tenant is the members’ own business.
“It can become very difficult because you are then wearing two hats,” says Martin Murden, a director of Partners Group, a financial services provider to accountants.
“You are the landlord in the superannuation fund and then you are the tenant, being a director of the business which is facing difficulties,” he adds.
“I have seen businesses, which have fallen into financially difficulties, not paying the true amount of rent to the super fund,” says Murden, the author of How to invest in property through your self managed super fund (released by Major Street Publishing).
These super funds had breached superannuation law by providing financial assistance to a related party.
The tax office, as regulator of self-managed super, has the power to strip an SMSF of its complying status.
In turn, the market value of a non-complying fund is taxed at the top marginal rate, less any non-concessional or undeducted contributions. This can remove almost half of a fund’s assets in tax, depending upon the circumstances.
And if your business cannot pay proper rent on a fund-owned business premises, your SMSF may have trouble meeting loan repayments if the property is geared. (See question four.)
<h3>2. What happens if I divorce?</h3>
Husband-and-wife business partners often arrange for their SMSF to acquire their business premises. The sad reality is that a marriage break-up will typically destroy the business partnership – in addition to the closure of the couple’s SMSF when their personal financial links are severed.
Frequently in such instances, the business premises are sold – perhaps in an unfavourable market – in order to split the super savings.
Of course, some husband-and-wife SMSFs would have sufficient other assets to enable one spouse to keep the property in his or her super fund and for other fund-held assets to go into the super account of the other spouse.
Couples who are considering acquiring the premises for their family businesses through their self-managed funds should keep in mind that the possibility that their relationship may fail is far from remote. Figures from the Australian Bureau of Statistics (ABS) suggest that 40% of marriages will end in divorce – a statistic that doesn’t include de facto relationships.
“Trying to disentangle superannuation assets [in a property settlement] can become very difficult,” says Murden.
He points out the need to split an SMSF’s assets such as business premises following a marriage breakdown do not solely involve husband-and-wife funds.
For instance, business partners may have set up an SMSF together to acquire their business premises. And the failure of the marriage or de facto relationship of one of the partners may trigger the splitting of superannuation assets.
In other words, the super savings of both business partners may be affected even though both may have been married to spouses with no involvement in the business.
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<h3>3. What if a member of my SMSF unexpectedly dies?</h3>
Depending upon the circumstances, the death of a fund member may force the sale of fund-owned business premises.
Under superannuation law, a fund must payout the superannuation death benefits of a deceased member to his or her beneficiaries. And funds often have to sell assets such as property to pay the death benefits.
The forced sale of business premises may, in turn, damage the commercial prospects of the family business.
Of course, the beneficiary of a deceased member’s super is often a surviving spouse who is also a member of the same SMSF. In such cases, there is perhaps no need to sell the business premises to pay death benefits.
Murden says some SMSFs deal with risk of having to pay death benefits by taking insurance policies on the life of each member.
A fund’s trustees would arrange for their SMSF to setup a special reserve account to pay the premiums on the life insurance policies. And the beneficiary of any payout upon death or permanent disability would be the SMSF through its special reserve account.
Under superannuation law, fund trustees must have an investment strategy that has regard to such matters as the risk of making an investment, the risks of inadequate diversification, and the liquidity of investments. Liquidity is a key issue when it is time to pay death benefits.
<h3>4. What if my SMSF defaults on a loan to buy my business premises?</h3>
The lender could sell the property in attempt to recover its debt (including any outstanding interest) along with the costs of selling the property and discharging the mortgage. Whatever is left is repaid to the fund.
Particularly if the property has fallen in value, the fund could lose capital and interest paid to the date of the default.
Sydney tax and superannuation lawyer Robert Richards suspects that some SMSFs will have difficulty making loan repayments after the halving from the concessional contributions cap for members over 50 to $25,000 a year from July. (Concessional contributions comprise salary-sacrificed and compulsory contributions as well as personally-deductible contributions by the self-employed and eligible investors.)
Craig Morgan, a director of mortgage broker SMSF Loans, points out that SMSFs tend to keep their loan-to-valuation ratio for commercial property to a maximum of 55%. With most of the loans Morgan arranges, the rent at least covers the interest payments.
 
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<h3>5. What are my possible CGT obligations when selling or contributing my business premises to my SMSF?</h3>
The increased value of the business premises during your personal ownership may be subject to capital gains tax (CGT) upon the transfer of its ownership – whether by sale or contribution – to your self-managed fund.
However, the small business CGT concessions on the sale of active assets of a business (such as its business premises) together with the standard CGT discount for assets owned for at least 12 months may eliminate any CGT – depending upon the circumstances. Get specialist tax advice on this point.
You should also be aware that some states apply stamp duty when a property owned by a member is contributed to a super fund.
“You may be eligible for the small business CGT concessions,” says Murden, “but speak to your tax adviser before doing a single thing. Get it wrong and you are going to pay a lot of tax.”
<h3>6. Are my retirement investments adequately diversified?</h3>
One of the negatives about owning your business premises in your SMSF is that your fund may have insufficient other assets to adequately diversify its portfolio against risks and to take advantage of non-property investment opportunities.
If a fund is poorly diversified, the retirement savings of the members depend on whether the property turns out to be a good investment. Of course, much will rely on the members’ personal circumstances including their other super and non-super investments.
This article originally appeared on <a href="https://www.smartcompany.com.au/index.php" target="_blank">SmartCompany</a>.
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Divorce, death, debt and default: Six questions SMSF trustees should be asking

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More SME owners will focus much more closely in coming months on the pros and cons of buying and gearing their businesses premises through their self-managed super funds.
Specialists in superannuation, investment and business advice <a href="https://www.smartcompany.com.au/finance/superannuation/43421-self-managed-super-smes-to-expedite-gearing-of-business-premises" target="_blank">expect SME owners to consider accelerating any existing plans</a> to gear their business premises through their self-managed super funds. This follows renewed debate about whether to bar future gearing.
The interim report of the Australian government’s inquiry into the financial system calls for views about whether superannuation gearing should be prospectively prohibited because it “may create vulnerabilities for the superannuation and financial systems”.
Here are 10 critical points to consider when deciding whether your SMSF should acquire business premises, typically through gearing, to rent to your family business:
Pros
<ol>
<li>
Family businesses may make excellent tenants Sue Prestney, a partner at PwC Private Clients, says that in her experience, family businesses tend to make “excellent” tenants for their SMSF-owned business premises. Again speaking in regard to her own clients, Prestney says their family businesses typically pay their rent on time to their SMSF. “They look after the premises like it was their own.” Martin Murden, a director of SMSF consulting and auditing with the Partners Wealth Group, says family businesses make “great” tenants provided the business is successful. And Murden says dealings between a family SMSF as landlord and a family business as tenant can be smoother – regarding such things as rent reviews – than with an arm’s-length tenant. 
</li>
<li>
Exception for business property Business real estate is one of the limited types of assets that SMSFs are allowed to acquire from related parties including members. And business real estate is one of the few types of assets that SMSFs can lease to related parties, including the members’ businesses, without a limit on its value under the in-house asset rules in superannuation law. 
</li>
<li>
Concessional tax treatment During an SMSF’s accumulation or saving phase, rents are taxed at 15% within the fund while capital gains are taxed at an effective 10% if the property is held for more than 12 months. And once the business premises are backing the payment of a superannuation pension, fund income and capital gains are tax-free. This means that the SMSF may eventually be able to sell a property in the pension phase without paying CGT on any profits. SMSFs in the accumulation phase can claim the same types of tax deductions as individual investors who buy properties in their own names including negative-gearing deductions for the shortfall between the deductible expenses, including interest payments, and rental income. 
</li>
<li>
Business succession and estate planning SMSF trustees aim to keep the premises of their family businesses in their super fund through generations, with the aim of gaining greater security of tenure for the business as well as business succession and estate-planning benefits. Under this strategy, an SMSF will need sufficient other assets to pay member superannuation benefits when necessary for older members such as a business’s founders. 
</li>
<li>
Asset protection Business premises held in an SMSF are generally out of the reach of creditors if individual fund members are declared bankrupt – subject to claw-back provisions in the Bankruptcy Act.
</li>
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Article continues on the next page. Please click below. 
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Cons
<ol>
<li>
Potential conflicts if family business struggles to pay rent While the principals of a troubled family business may need the premises to keep trading, the family SMSF’s trustees – who are often the same people – must maintain the fund for the core or sole purpose of paying member benefits. Additionally, funds are prohibited from providing financial assistance to members, says Murden. This includes giving rent relief to family businesses in financial difficulties. 
</li>
<li>
High-cost business premises can dominate an SMSF’s portfolio This can make it to diversify a fund’s portfolio to spread investment risks and opportunities. When preparing their mandatory investment strategies, SMSF trustees must consider such factors as investment risk, portfolio diversification, liquidity of investments, ability to pay member benefits and the members’ circumstances. Peter Crump, superannuation strategist for ipac South Australia, says that super funds are not legally required to diversify their investments but emphasises that trustees must consider diversification when preparing their investment strategies. Indeed, some fund trustees specifically decide to have SMSF portfolios dominated by a single property asset, such as the premises of their businesses, perhaps after considering the diversification of their other super and non-super investments. 
</li>
<li>
It may be more tax-effective to gear business premises outside super Much will depend on the circumstances. First, the superannuation tax rate is much lower than most personal marginal tax rates, thus providing potentially lower tax deductions for negative gearing. Second, lenders usually require a much higher deposit for SMSF gearing, which means a property is likely to remain negatively-geared for a relatively short period – if at all. As well, SMSF trustees should be cautious about relying too much on the possibility that the business premises will eventually be sold when the asset is backing the payment of a pension and thus becomes exempt from CGT. Crump suggests that trustees recognise that the fund may well sell the property before it becomes exempt from CGT. 
</li>
<li>
Potential costly traps in conditions for super gearing SMSFs should gain quality professional advice to ensure compliance with the strict conditions allowing funds to borrow. Mistakes can be costly. SMSF Trustees must enter a limited recourse borrowing arrangement and a geared asset must be held in a separate trust until the load is repaid. Lenders cannot make a claim against any other assets of the super fund in the event of a default on the loan. 
</li>
<li>
SMSF could face severe financial setback following loan default Despite the requirement for a limited recourse loan, an SMSF that defaults on a loan to buy business premises could lose its sizeable deposit plus capital repayments and payments of interests and costs. Upon a property’s forced sale, a defaulting fund would be paid whatever is left after the lender recovers any outstanding amounts including the cost of a forced sale and the discharge of the mortgage.
</li>
</ol>
This article first appeared on <a href="https://www.SmartCompany.com.au" target="_blank">SmartCompany</a>. 
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Should your SMSF own your business premises? The pros and cons

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Self-manged super funds (SMSFs) hoping to gain tax relief for repairs and improvements to a fund-owned investment propertyshould act with particular caution if the property is geared.
Under superannuation law, money borrowed by an SMSF under a limited recourse loan arrangement must be used only to buy and maintain the property – not to improve it.
Crucially, a fund can use its own money to improve a property – not borrowed money – provided those improvements are not so extensive so as create a new asset, according to a final tax ruling released in May last year.
Graeme Colley, director of technical and professional standards for the Self-Managed Super Fund Professionals’ Association, explains that an SMSF in the accumulation phase is entitled to claim the same types of tax deductions as individual investors who buy properties in their own names.
For instance, an SMSF can claim deductions for loan interest, repairs, any shortfall between the deductible expenses and the rent, and depreciation.
And SMSFs can claim capital works deductions.
See our free ebook on the <a target="_blank" href="http://propertyobserver.com.au/ebooks/free-ebook-top-24-tax-strategies">top 24 tax strategies</a> for property investors.
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Take extra care with self-managed super fund property

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With certain exceptions, preserved superannuation benefits must remain in the super system until members permanently retire after reaching their “preservation age” (currently at least 55) or turning 65 (even if still working).
The locking of benefits into superannuation could be seen as an advantage or disadvantage by some fund members.
Many SMSFs aim to hold on to their properties at least until retirement.
Some SMSF members will produce better negatively-gearing tax breaks from gearing a property in their own name rather than through their fund.
Much depends on the circumstances.
Another possible pitfall is that ownership of a costly property may limit a fund’s ability to adequately diversify their portfolios to spread its risks and opportunities.
<hr>
This article is part of the <a href="http://propertyobserver.com.au/ebooks/free-ebook-21-dos-and-donts-for-smsf-property-investors" style="color: #000000; font-size: 15px;">free eBook: 21 do’s and don’ts for SMSF property investors</a>. 
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Don't ignore potential pitfalls of SMSF property

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Superannuation law does not prohibit a fund from owning just one asset such as a valuable investment property.
Indeed, some fund trustees specifically decide to have SMSF portfolios dominated by a single property asset, perhaps after considering the diversification of their other super and non-super investments.
SMSFs are required to have written investment strategies.
And when preparing their strategies, trustees must consider such factors as investment risk, portfolio diversification, liquidity of investments, ability to pay member benefits and the members’ circumstances.
Despite the requirement that fund trustee smust consider diversification when preparing an investment strategy, they are not legally required to diversify.
Financial planners and superannuation specialists typically urge fund trustees to recognise the possible consequences if their retirement savings are overly dependent on the profitability of a single, high-cost asset.
<hr>
This article is part of Property Observer's <a href="http://propertyobserver.com.au/ebooks/free-ebook-21-dos-and-donts-for-smsf-property-investors" style="color: #000000; font-size: 15px;">free eBook: 21 do’s and don’ts for SMSF property investors</a>. 
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Do think about impacts of direct property on your fund's diversification

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Superannuation law allows self-managed super funds to borrow to invest provided strict rules are met.
Geared assets must be held in a special trust until payment of the final installment.
And lenders cannot make a claim against any other assets of the super fund – apart from the geared asset – in the event of a default on the loan.
Martin Murden, director of SMSF consulting with the Partners Group in Melbourne, says his firm receives about one serious question a day from people who are interested in gearing through an SMSF.
“This is beyond tyre-kicking,” he emphasises.
<hr>
This article is part of Property Observer's <a href="http://propertyobserver.com.au/ebooks/free-ebook-21-dos-and-donts-for-smsf-property-investors" style="color: #000000; font-size: 15px;">free eBook: 21 do’s and don’ts for SMSF property investors</a>.
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Do understand the basics of SMSF gearing

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Rents are concessionally-taxed at 15% while capital gains are taxed at an effective 10% during your fund’s accumulation or saving phase if the property is held for more than 12 months.
And once the property is backing the payment of a superannuation pension, fund income and capital gains are tax-free under current law.
This means that your SMSF may eventually be able to sell a property in the pension phase without paying any CGT on the profits.
The Labor Government had proposed to tax annual earnings of more than $100,000 from superannuation assets supporting a pension.
However, the legislation wasn’t passed before federal Parliament went into its pre-election recess.
SMSFs in the accumulation phase are entitled to claim the same types of tax deductions as individual investors who buy properties in their own names.
For instance, an SMSF can claim deductions for loan interest, repairs and depreciation, and for any shortfall between the deductible expenses and the rent.
But it is crucial not to overrate the benefits of negative gearing through an SMSF.
 
<hr>
This article is part of the <a href="http://propertyobserver.com.au/ebooks/free-ebook-21-dos-and-donts-for-smsf-property-investors" style="color: #000000; font-size: 15px;">free eBook: 21 do’s and don’ts for SMSF property investors</a>. 
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Do understand the tax treatment of SMSF property

<a href="https://www.apartments.com.au/new-apartments/smith-by-valli-collingwood-224-228-smith-street-collingwood-vic-3066">Smith Collingwood</a> is a new boutique apartment development bringing a refined, design-led approach to one of Melbourne’s most established inner-city neighbourhoods.

Designed by <a href="https://www.apartments.com.au/architects/pandolfini-architects">Pandolfini Architects</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/lisa-buxton-interiors">Lisa Buxton</a>, Smith by Valli sits on iconic Smith Street and comprises just 22 residences tailored toward owner-occupiers seeking a more considered style of apartment living.

[smartcode_project:default project_id=140747 project_image_fid=367540]

The design of Smith focuses on a north-facing orientation across all residences, a relatively uncommon feature in dense inner-Melbourne settings. Each apartment has been planned to maximise natural light and outlook, alongside a material palette defined by warm tones, custom joinery, and a full suite of Gaggenau appliances.

The development comprises a mix of one, two, and three-bedroom apartments, with pricing currently ranging from just under $1 million to around $4.85 million for the premium penthouse-level residences, reflecting growing demand for luxury owner-occupier product in Melbourne’s inner urban market.

Residents will also have access to a private rooftop garden designed as an elevated retreat above the city, &nbsp;featuring curated landscaping, veggie boxes, intimate seating areas and spaces for relaxed gatherings. Sustainability has also been integrated into the project through a 7-star energy rating and two secure bicycle facilities for every residence.

[smartcode_project:default project_id=140747 project_image_fid=367529]

Smith by Valli sits in the heart of one of Melbourne’s most established retail and hospitality strips, within walking distance of venues such as Falco Bakery, Carnation Canteen and Alimentari, alongside parks and everyday services. With a Walk Score of 99, the location reinforces the project’s positioning toward buyers prioritising walkability and access over car dependency.

With only a limited number of residences, Smith reflects growing demand for smaller, highly curated apartment developments that prioritise design quality, liveability, and connection to neighbourhood character.

[smartcode_project_cta:default project_id=140747]

Joel Robinson

Smith by Valli delivers a refined collection of luxury residences to Melbourne’s inner north

<a href="https://www.urban.com.au/developers/far-east-consortium">Far East Consortium</a>’s 640 Bourke Street stands as a testament to&nbsp;<a href="https://www.urban.com.au/developments/melbourne-vic-3000">Melbourne</a>’s ability to bridge its storied past with a bold vision for the future.&nbsp;

Rising above the heritage-listed Eliza Tinsley building, the development reflects a broader shift toward adaptive reuse in the city, where historical assets are retained and reinterpreted as part of new residential development.

Designed by <a href="https://www.urban.com.au/architects/rothelowman">Rothelowman</a>, <a href="https://www.apartments.com.au/new-apartments/640-bourke-street-melbourne-640-bourke-street-melbourne-vic-3000">640 Bourke Street</a> incorporates the Eliza Tinsley building as its foundation, housing a grand gallery and lobby space that serve as both a functional and symbolic centrepiece. The heritage façade informs the tower’s design, creating a connection between Melbourne’s past and its contemporary skyline.

"It's a significant asset and wants to be celebrated and experienced by all residents every single time they go in and out of the building," Rothelowman Principal Stuart Marsland said.

[smartcode_project:default project_id=509 project_image_fid=365684]

Above this historic base, the 68-storey tower will deliver just over 600 residences, a notable reduction from earlier schemes, reflecting a deliberate move toward larger-format apartments and a stronger owner-occupier focus.

Unlike traditional CBD developments that prioritised investor stock, 640 Bourke Street has been repositioned to respond to changing buyer expectations.

"The discussion was all around making 640 Bourke Street the best residence to live in, to be much more focused on the people in the building rather than people looking at the building," Marsland explained.&nbsp;

This shift is evident in the development’s interiors, which emphasise practical luxury with spacious layouts, high ceilings, and floor-to-ceiling windows framing sweeping views of Melbourne and Port Phillip Bay.&nbsp;

“What it's meant for 640 Bourke is we've actually reduced the number of apartments. We've increased the overall size of the apartments. We don't have any studios in here, and what that does for a project is it elevates it," Lauren Sheldon, Far East Consortium’s Director of Sales and Marketing, said.&nbsp;

[smartcode_project:default project_id=509 project_image_fid=365687]

Rothelowman Associate Jun Chang added, "We were given the opportunity to be more generous. The apartments became bigger and squarer than any other apartments which had been designed in the CBD before that."&nbsp;

Amenities spanning more than 3,000 sqm across multiple levels further reinforce this focus on resident experience. These include a pool, gym, co-working areas, and a range of hospitality-inspired spaces such as a whisky lounge, library, and private dining rooms, many drawing reference from traditional bathhouses and Melbourne’s laneway culture.

"We wanted to make both the pool and the gym area to be absolutely destinational, and when you traverse across to these spaces, there is a gentle familiarity to the beautiful notions of the hammams and the Roman baths, a gentle nod to history," Chang noted.

At street level, the project contributes to the ongoing transformation of the western CBD, with upgrades to Langs Lane and the introduction of retail, hospitality, and gallery spaces designed to activate the precinct and strengthen its connection to the surrounding city fabric.

[smartcode_project:default project_id=509 project_image_fid=365689]

The location places residents within walking distance of Southern Cross Station, Flagstaff Gardens, Queen Victoria Market, and the Docklands waterfront, positioning the development within a rapidly evolving inner-city neighbourhood.

"We believe it's the best site left in the city of Melbourne," Craig Williams, Executive Director at Far East Consortium, said.&nbsp;

640 Bourke Street is Far East Consortium’s 14th building in Melbourne’s western CBD.

"A very elegant designed building. It's going to be a Melbourne statement for many, many years to come."

One-bedroom apartments are priced from around $640,000, with 640 Bourke Street targeting completion in 2029.

Renders shown are Artist's Impressions correct as of May 2026.

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Heritage-led design anchors Far East Consortium’s 640 Bourke St, Melbourne

<a href="https://www.apartments.com.au/developers/mayd-group">MAYD Group</a> has set a new residential price record in Queensland with the $30 million sale of the penthouse at its <a href="https://www.apartments.com.au/new-apartments/one-burleigh-88-the-esplanade-burleigh-heads-qld-4220">ONE Burleigh</a> development in Burleigh Heads.

The sale equates to around $37,500 per sqm.

The two-level, 800 sqm penthouse, featuring five bedrooms, five bathrooms, five car spaces, and a private infinity pool overlooking the Pacific Ocean, was acquired by a Gold Coast-based entrepreneur, highlighting continued demand for ultra-premium beachfront product.

Selling agent Freddie Tehle of PRD Burleigh Heads said the result reflects tightening supply of high-quality, large-format apartments in Burleigh.

“There’s very limited opportunity to secure this level of scale and absolute beachfront position in <a href="https://www.apartments.com.au/developments/burleigh-heads-qld-4220">Burleigh Heads</a>,” Tehle said.

“Buyers are increasingly seeking apartments that genuinely replace a standalone home, and this penthouse delivers that with its size, privacy, and direct ocean frontage.”

[smartcode_project:default project_id=146358 project_image_fid=323057]

The sale comes as construction progresses on ONE Burleigh, a boutique development of 17 full-floor residences at 88 The Esplanade, scheduled for completion in early 2027.

Developed by MAYD Group and designed by <a href="https://www.apartments.com.au/architects/mas-architecture-studio">MAS Architecture</a> with interiors by <a href="https://www.apartments.com.au/interior-designers/sici-design">Sici Design</a>, the project has been positioned as a collection of house-sized beachfront apartments, each occupying an entire floor with around 381 sqm of internal and external living space.

When construction commenced, MAYD director Todd Mould pointed to the long-term resilience of premium coastal real estate as a key driver behind the project.

“Real estate, particularly at the premium end, remains one of the most resilient and proven long-term investment avenues,” Mould said.

“Our ambition is that anyone who buys a MAYD-built product can genuinely feel the care, craftsmanship and commitment we bring to every detail.”

[smartcode_project:default project_id=146358 project_image_fid=323055]

Each residence has been configured with four bedrooms, multiple living zones, a private office, and expansive ocean-facing terraces. Interiors draw on a restrained material palette, including travertine stone, timber joinery, and integrated premium appliances.

Interior designer Sici Design said the approach was to reflect the project’s coastal setting through both materiality and spatial planning.

“ONE Burleigh is our vision of luxury living, designed to bring the essence of Burleigh Heads' vibrant coastal beauty into an unparalleled residential experience.”

Residents will have access to a suite of wellness-focused amenities, including pools, sauna facilities, and dedicated relaxation spaces, reflecting a broader shift toward lifestyle-driven apartment design on the Gold Coast.

[smartcode_project:default project_id=146358 project_image_fid=323052]

The project occupies a southern Esplanade site with uninterrupted beachfront frontage, an increasingly rare offering in Burleigh Heads, free from the Norfolk Pines that line much of the coastline and often limit direct ocean outlook.

Mould said the design intent was to balance that outlook with a sense of retreat.

“Living at ONE Burleigh is about how your day naturally unfolds, morning light across the ocean, coffee on the balcony, and being in Burleigh but elevated above the noise.”

The result further reinforces Burleigh Heads’ emergence as one of the Gold Coast’s most tightly held and supply-constrained beachfront markets, where boutique, owner-occupier-focused developments are increasingly setting new price benchmarks.

[smartcode_project_cta:default project_id=146358]

MAYD Group sets Queensland record with $30 million penthouse sale at ONE Burleigh in Burleigh Heads

Apartment developers in the Gold Coast are finding new, creative ways to differentiate themselves from competing projects, as new supply starts to flow through up and down the Coast.

Developer BIG Projects brought in the renowned Sydney-based design studio YSG Studio to craft the interiors for The Frederick, BIG Projects' new Mermaid Beach project and YSG Studio's first move into the multi-residential development space.

[smartcode_project:default project_id=110588 project_image_fid=5346]

It was a strategic move for BIG Projects to bring in a Sydney eye to the development.

“Our role is to give our design partners the space and freedom to explore,” says Matt Barrett, Director of BIG Projects.

“We wanted YSG Studio to capture the essence of Nobby’s, to design a building that embraces life, light and connection, while creating a genuine sense of place.”

There are only 39 apartments in The Frederick, including a striking beach house, just 100 metres from the booming Nobby Beach precinct.&nbsp;

[smartcode_project:default project_id=110588 project_image_fid=5347]

Yasmine Ghoniem, Director of YSG Studio, says their vision&nbsp;for The Frederick "reinvents coastal living."

“Nobby’s has such an iconic energy, it’s one of those rare pockets of the Gold Coast where the community, the beach, and the streets all feel connected,” Ghoniem says.

"Responding to the neighbouring coastline, soothing curves add a relaxing regional overlay, while unique detailing really sets it apart. It’s a place that feels lived in from the moment you step inside.”

A standout feature of The Frederick is its rooftop terrace, an uncommon inclusion for a boutique, low-rise building, where amenity is typically concentrated at ground level.

[smartcode_project:default project_id=110588 project_image_fid=5360]

Positioned to capture panoramic views from the hinterland to the ocean, the rooftop has been designed as a series of intimate zones. It includes a pool, sauna, sun decks, workspaces and dedicated entertaining areas.

“The rooftop was conceived as a collection of spaces where residents can unwind and connect, an extension of the Nobby’s lifestyle,” Barrett says.

Architecture for the project was led by Plus Studio, with landscape design by LDG Landscape Architecture.

SRQ Projects Director Nick Clydsdale, who is handling sales at The Frederick, says the majority of enquiry is coming from South East QLD and Victorian buyers who have been actively searching between Broadbeach and Mermaid Beach for some time.

"They’ve reviewed a number of projects, however this one has stood out for its unique detailing and compelling design,"&nbsp;Clydsdale says.

Site demolition is slated for this month, with construction commencing soon after. BIG Projects is targeting a late 2027 completion.

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Sydney’s YSG Studio makes Gold Coast multi-residential debut with BIG Projects at The Frederick

Melbourne-based property developer ALTA Property has this week achieved planning approval for the adaptive re-use of a former commercial tower into a $200 million, 169-apartment project at 10 Queens Road, one of the last developable sites along the Albert Park Lake-fronting boulevard.&nbsp;

Set within one of Melbourne’s most sought-after precincts and designed by <a href="https://www.apartments.com.au/architects/fraser-partners-0">Fraser and Partners</a>, the illustrious building will offer unparalleled views across Albert Park Lake, Port Phillip Bay and Melbourne CBD.&nbsp;

The mix of 1, 2 and 3-bedroom residences will be complemented by a ground-floor amenity featuring private dining, a lounge bar, gym and wellness spaces, co-working, outdoor communal gardens, and retail.&nbsp;

The 17-storey building is a masterclass in adaptive re-use, with the existing commercial building’s façade, shell and internal structure to be retained, before high-end residences are built from the ground up in a newly built Albert Park facing addition to the building.&nbsp;

Sitting atop the building will be two 320+sqm penthouses with private rooftop terraces, which are expected to be priced between $9 - $11 million.&nbsp;

<img alt="ALTA Property achieves permit approval for $200 million Queens Road tower" data-entity-type="file" data-entity-uuid="aa11211b-5581-43f9-940c-fc84d30a0e61" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/C_04.png?VersionId=Yhf5p_1EgGDu_zOIMFgvA8Ug8j3sTFQs" />

Architecturally, the building will feature a curved, geometric façade that celebrates and elevates the existing structure, with warm, muted tones which were selected to extend the materiality of the existing building rather than contrast it.&nbsp;

Interiors will bring together three metre high ceilings with waffle concrete in some spaces, natural timber, granite and Australian materials, culminating in crafted, generous and considered spaces that are defined by authenticity.&nbsp;

The adaptive re-use means that the Queens Road project will be a sustainability led, high-quality finished product, with a 62% saving in carbon emissions by re-using the existing structure rather than knocking it down and rebuilding.&nbsp;

ALTA Property was launched by Nigel Givoni in 2023, bringing over 25 years of experience in multi level residential delivery.&nbsp;

Melbourne’s property market growth is currently led by apartments. According to RPM VIC Apartments &amp; Townhomes Market Report (April 2026), units are outpacing houses, especially in the middle ring suburbs where median prices hit $757,500 – a four-year high that represents 2.9 percent growth quarter-on-quarter.&nbsp;

<img alt="ALTA Property achieves permit approval for $200 million Queens Road tower" data-entity-type="file" data-entity-uuid="647e13d7-b4bc-433a-9bc9-fe3c3dd4f2ec" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/V_06.png?VersionId=ou4NUCWUgA3NAy.6CQJlEdKX50j3dOk6" />

For ALTA Property Founder Nigel Givoni, this performance speaks to the confidence he has in the Melbourne market.&nbsp;

“Queens Road represents a rare opportunity to continue to shape our presence in the Melbourne market.,"&nbsp;Givoni says.

"With a considered project team and a premier site along one of the city’s most sought-after boulevards, we look forward to contributing to the fabric of this established address.

“Other Australian markets are getting a lot of attention, but I believe the depth of value in Melbourne is being overlooked. The fundamentals are strong, population growth is steady and, based on our preliminary conversations with a leading builder, construction costs are beginning to normalise, creating further opportunity."

Givoni says the project is a&nbsp;highly considered example of adaptive re-use, delivering quality, high-end residences, premium hotel-inspired amenities and an architecturally striking façade, all achieved without the need to remove the existing structure.

"We are really looking forward to the market’s response,” he said.&nbsp;

Michael Laurence

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