Buyers considering a residence at boutique Gordon townhouse development <a href="https://www.apartments.com.au/new-townhouses/lume-gordon-43-47-dumaresq-street-gordon-nsw-2072">Lume</a>&nbsp;now have another reason to bring forward their decision.

For a limited time, purchasers of a residence at Lume will receive a BMW iX3 50 electric SUV, valued at more than $120,000, as part of their purchase. The offer is designed to add value for buyers while complementing the lifestyle envisioned for the architecturally designed Upper North Shore development.

Scott Timmins, Development Manager at <a href="https://www.apartments.com.au/developers/winim">WINIM</a>, said the partnership was created to provide buyers with a compelling reason to act.

"In today's market, buyers need a compelling reason to act now, and the BMW partnership was designed to create that catalyst. We wanted to add genuine value for our future purchasers. Choosing the all-electric BMW iX3 50 also reflects the values behind LUME, forward-thinking design, innovation and a more sustainable way of living. It's a premium incentive that complements the lifestyle our buyers aspire to and rewards those who commit early."

[smartcode_project:default project_id=7354 project_image_fid=374893]

Delivered by WINIM in partnership with Burtonwood Investment Partners, Lume comprises 14 architecturally designed two, three and four-bedroom townhomes created for families seeking the space of a freestanding house with the ease of modern, low-maintenance living.

The three-storey residences, designed by award-winning architecture practice <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a>, have been tailored for families and multi-generational living, featuring private internal lifts, flexible lower-level spaces, generous open-plan living and entertaining areas, media rooms, and landscaped outdoor spaces with custom outdoor kitchens.&nbsp;

Inside, engineered oak flooring, bespoke dining joinery with integrated wine fridges and backlit bars, sculptural porcelain bathrooms, Parisi freestanding baths and Astra Walker tapware create interiors that balance functionality with refined finishes.

Each townhome has been designed to combine generous internal spaces with sustainability initiatives such as EV charging infrastructure, while <a href="https://www.apartments.com.au/landscape-architect/arcadia-landscape-architecture">Arcadia</a>'s landscaped communal areas, centred around a restored creek line and native planting, encourage residents to connect with nature and spend more time outdoors.

[smartcode_project:default project_id=7354 project_image_fid=269527]

Rothelowman's Gary Tsui said the architecture was conceived to respond carefully to its Upper North Shore setting.

"Our vision was to create elegant, uplifting homes that draw on and positively contribute to the local character through meticulously considered design and an interaction with the surroundings."

The communal landscape has been designed as more than an open space between homes. Arcadia's Ben Newell and Kate Phillips said the adjoining reserve provided an opportunity to create a distinctive natural retreat for residents.

"Just as waterways carve their way through Ku-ring-gai's landscape, a raised boardwalk weaves through the reserve, connecting the homes to this tranquil oasis."

[smartcode_project:default project_id=7354 project_image_fid=374892]

Located just 300 metres from <a href="https://www.apartments.com.au/developments/gordon-nsw-2072">Gordon</a> Village and Gordon railway station, Lume offers convenient access to Sydney's CBD while placing residents close to some of the North Shore's leading schools, including Ravenswood, Pymble Ladies' College and Knox Grammar. Lane Cove National Park, Gordon Golf Club and a range of cafés and restaurants further reinforce the family-focused lifestyle on offer, with the BMW iX3 50 complementing everything from local trips around Gordon to weekend drives and city commutes.

Construction is underway with completion expected in mid-2027.

[smartcode_project_cta:default project_id=7354]

Joel Robinson

Boutique Gordon townhomes now come with a BMW iX3 50

Two apartments have sold for more than $10 million at EADE Byron Bay, setting some of the highest apartment prices ever achieved in the coastal town and underlining the growing appetite for luxury beachfront apartments in Australia's most popular coastal locations.

The $210 million project by Vitale Property Group has now secured more than $70 million in sales, led by residences that changed hands for $12.75 million and $11.75 million.

The record-breaking transactions reinforce the shift occurring in Byron Bay's premium property market, where affluent downsizers and lifestyle buyers are increasingly opting for high-end apartments over large beachfront homes.

<a href="https://www.apartments.com.au/new-apartments/eade-byron-bay-29-shirley-street-byron-bay-nsw-2481">EADE Byron Bay</a> occupies a rare 6,000 sqm absolute beachfront site on the corner of Shirley and Milton Streets overlooking Main Beach and The Wreck surf break, just 350 metres from Byron Bay's town centre.

The 25-residence development is the first beachfront apartment project approved in Byron Bay in more than a decade and is currently under construction, with completion expected in May 2027.

[smartcode_project:default project_id=145590 project_image_fid=359521]

The project has attracted a mix of local Byron Shire residents downsizing from larger homes, alongside interstate buyers from Sydney, Melbourne and Brisbane seeking a permanent coastal lifestyle without compromising on space.

Designed by <a href="https://www.apartments.com.au/architects/hayball">Hayball</a> and with interiors by <a href="https://www.apartments.com.au/interior-designers/alexander-co">Alexander &amp; Co</a>, EADE comprises&nbsp;10 garden apartments ranging from 284 sqm to 622 sqm, nine with private pools, five full-floor apartments and 10 rooftop residences with private plunge pools, expansive outdoor entertaining areas and uninterrupted ocean views.

[smartcode_project:default project_id=145590 project_image_fid=359527]

<a href="https://www.apartments.com.au/developers/vitale-property-group">Vitale Property Group</a> Managing Partner Chris Vitale said the project's combination of scale, location and limited future supply was driving buyer demand.

"There isn't another beachfront holding in Byron Bay of this size and position that could be developed again," Vitale said.

"Buyers are responding to the scarcity and the irreplaceability of a site of this calibre and to floorplans they can't find elsewhere in the market.

"We are seeing buyers place significant value on quality, space, design, resort-style amenities and the rarity of the location. The sales achieved to date demonstrate that discerning purchasers recognise the long-term significance of what is being created at EADE Byron Bay.

"Many are coming from larger homes in the Byron region, or from Sydney, Melbourne and Brisbane, and are after the space, security and convenience, without the upkeep of a house."

&nbsp;

[smartcode_project:default project_id=145590 project_image_fid=359523]

The Byron Bay project follows Vitale Property Group's delivery of the Mondrian Hotel and Private Residences at Burleigh Heads, with EADE continuing the developer's focus on luxury coastal developments.

Residents will have access to a resort-style swimming pool, gymnasium, sauna, cold plunge pool, concierge services and dedicated workspaces, while the project is targeting an 8-Star Green Star rating.

EADE Byron Bay is being exclusively marketed by Projx Australia in conjunction with WHITEFOX Projects.

WHITEFOX National Projects Director Phillip Rand said demand had been driven predominantly by owner-occupiers.

"We are seeing buyers at EADE place significant value on quality, space, design, resort-style amenities and the rarity of this location," Rand says.

"The sales achieved to date demonstrate that purchasers at this level recognise the long-term significance of what is being created at EADE Byron Bay."

Residences at EADE Byron Bay are currently priced between $4.75 million and $15.95 million.

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[smartcode_project_cta:default project_id=145590]

Vitale breaks Byron Bay records with EADE sales flurry 

When buying an apartment, most people compare the big-ticket items first. Floorplans. Kitchens. Balcony size. Natural light. The view.

But there's one everyday consideration that often doesn't come up until after moving in: how parcels are delivered.

As online shopping has become part of everyday life, parcel deliveries have shifted from an occasional event to a regular occurrence. Australians spent a record $82.6 billion shopping online in 2025, with almost one in every four retail dollars now spent digitally.

For apartment residents, that can present a challenge.

If nobody is home to accept a delivery, parcels may be redirected to a nearby Post Office, left in a building lobby or common area, or require building management to step in. In higher-density buildings, where dozens or even hundreds of residents may receive deliveries each day, parcel management has become an increasingly important part of everyday living.

That can create a range of frustrations. A missed delivery often means making time to collect a parcel elsewhere, while packages left unattended in foyers or mail areas can create clutter and increase the risk of theft. What seems like a minor inconvenience can quickly become a recurring issue for residents who shop online regularly.

It's one of those details that rarely features in a display suite but can have a noticeable impact once residents move in.

As a result, buyers are beginning to look beyond traditional apartment features and consider how a building supports day-to-day convenience, including whether there are secure options for receiving deliveries.

Australia Post's Parcel Lockers provide one solution.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" allowfullscreen="" frameborder="0" height="315" referrerpolicy="strict-origin-when-cross-origin" src="https://www.youtube.com/embed/CkF2oKmlACg?si=C50sDaoUUn2nuLmq" title="YouTube video player" width="560"></iframe>

Rather than having a parcel delivered directly to an apartment, eligible deliveries can be sent to a nominated Parcel Locker. Once the parcel arrives, residents receive a notification through the AusPost app or SMS and can collect it using a QR code or one-time PIN at a time that suits them.

The Parcel Locker network now includes more than 1,500 locations nationwide, with installations at Post Offices, shopping centres, transport hubs and an increasing number of residential developments. By providing a secure collection point, Parcel Lockers help reduce missed deliveries and avoid parcels being left unattended in common areas.

For developers, parcel infrastructure is becoming another way to improve the resident experience. Rather than relying on concierge staff or leaving parcels in communal spaces, secure collection points help streamline deliveries while preserving the presentation and functionality of shared areas.

For buyers, it's a reminder that the best apartment features aren't always the most obvious.

A generous floorplan or quality finishes might help narrow the shortlist, but the conveniences that simplify everyday life, whether that's EV charging, secure bike storage or reliable parcel delivery, often become the features residents appreciate most once they're living there.

The apartment feature many buyers don't think about, until their first missed delivery

<a href="https://www.apartments.com.au/developers/hg-developments">HG Developments</a> is doubling down on Maud Street in Newstead, filing plans for a new apartment tower just a few doors down from its under-construction Aire Newstead development.

Recently submitted to Brisbane City Council, the proposal is for an 18-storey building designed by bureau^proberts, which has drawn heavily on Brisbane's subtropical design principles while referencing the suburb's industrial heritage.

A total of 64 apartments are planned for the amalgamated 1,518 sqm site at <a href="https://www.apartments.com.au/new-apartments/17-21-maud-street-newstead-qld-4006">17–21 Maud Street</a>, a short walk from the Brisbane River and Newstead Riverwalk.

<img alt="First look: HG Developments plans 18-storey subtropical apartment tower for Newstead" data-entity-type="file" data-entity-uuid="a400c7fd-bd15-48f8-a63b-10ede92efe00" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Maud%20st%20bldg.png?VersionId=.0vPmjpbC7CNP7kqGWa6L7rGIwsNExaw" />

"The building is defined by a series of vaulted motifs that reinterpret the arches, colonnades and layered facades evident throughout Newstead's historic built fabric," the Urban Design Report states.

"Combined with recessed glazing and generous balconies, these elements create a layered building envelope that provides shade, weather protection and opportunities for natural ventilation whilst establishing a distinctive architectural identity."

The proposal comprises 64 two, three and four-bedroom apartments across 18 residential levels, positioning it alongside a growing number of taller residential projects transforming Newstead's northern precinct. The tower incorporates extensive subtropical landscaping, with cascading planter boxes, deep planting at street level and a landscaped rooftop recreation area.

<img alt="First look: HG Developments plans 18-storey subtropical apartment tower for Newstead" data-entity-type="file" data-entity-uuid="1d8140f4-8b98-45cd-b1b8-1efe8c8e266b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Maud%20st%20podium.png?VersionId=VAZtbCoD44YCJ57N99fQCAKeSJx7ldZs" />

Bureau Proberts has prioritised passive environmental design throughout the project, with generous balconies, recessed glazing and operable façades helping reduce solar heat gain while maximising natural ventilation. River views become available from the upper levels, while the building has been orientated to capture prevailing breezes from both the Brisbane River and the west.

The architects say landscape is intended to be integral to the building rather than an applied element.

"Vertical greenery, cascading planter boxes and elevated gardens are woven throughout the architecture, softening the built form and strengthening the connection between residents and the subtropical environment."

"Through the integration of landscape, high-quality materials and passive design principles, the development delivers a refined residential address that celebrates Newstead's heritage character while contributing positively to Brisbane's evolving subtropical identity."

Newstead has remained one of Brisbane's most active apartment markets in recent years, with a number of developers continuing to back the inner-city suburb.

HG Developments is currently delivering the 40-apartment Aire Newstead at 25 Maud Street. Fortis recently launched the 65-apartment <a href="https://www.apartments.com.au/new-apartments/crest-walker-newstead-12-kyabra-street-newstead-qld-4006">Crest &amp; Walker</a> on Kyabra Street, while builder-developer BPG and Don O'Rorke's Consolidated Properties are both expected to launch their respective Newstead projects before the end of the year.

HG Developments doubles down in Newstead with second Maud Street apartment development

Walk past a new apartment development promoting its sustainability credentials and it's easy to picture rooftop gardens, mature trees, landscaped courtyards and residents surrounded by nature.

But in many cases, that's not actually what those sustainability ratings guarantee.

Australia's leading environmental rating tools have played a significant role in improving the energy efficiency and environmental performance of buildings. Yet despite their focus on reducing emissions, many don't require developers to include trees, biodiversity or meaningful green space.

In other words, a building can achieve one of the country's highest sustainability ratings while containing little more than concrete, glass and hard landscaping.

That disconnect has led to the emergence of a new movement across Australia's property industry: nature-based cities.

The concept goes beyond designing buildings that consume less energy. Instead, it encourages developers to treat nature as essential infrastructure, integrating biodiversity, tree canopy, living landscapes and green spaces into projects from the earliest stages of planning.

Research has consistently linked access to nature with better physical and mental health, cooler neighbourhoods, improved biodiversity, stronger climate resilience and more connected communities. As Australia's cities continue to become denser, advocates say those outcomes should be considered just as important as energy efficiency.

Nature Based Cities (NBC) was established in 2022 to help accelerate that shift.

Founded by Hamton Executive Chairman Paul Hameister OAM, the not-for-profit was created after research highlighted a significant gap in Australia's sustainability framework. While existing environmental rating tools rewarded energy performance and emissions reductions, they placed little emphasis on the inclusion of living landscapes.

"We've always wanted to do more, and we know other developers who want to do more, but the ESD rating tools just aren't there," Hameister says.

"In Australia, you can have a five-green-star rated building that's concrete and glass with not a blade of grass.

"The focus is on reducing emissions, which is laudable, but there hasn't been enough attention paid to protecting and re-establishing nature. We need both for the health of the environment and for communities."

Since its launch, NBC has developed independent design guidelines and accreditation frameworks that encourage developers to prioritise ecology, biodiversity, tree canopy, walkability and living landscapes alongside traditional sustainability measures. The organisation first focused on medium and high-density residential developments before recently expanding into precinct-scale communities and masterplanned neighbourhoods.

Jan Talacko, founder of sustainability consultancy Ark Resources and a member of the Nature Based Cities Advisory Council, says the initiative addresses an area that has largely been overlooked by the property industry.

"Throughout my 25 years of working collaboratively with all stakeholders in the property sector, I've always favoured a pragmatic approach to sustainable design which encourages initiatives that not only meet environmental expectations but also improve amenity," Talacko says.

"Whilst we are making steady progress in relation to energy and carbon emissions from buildings, there has been much less emphasis on encouraging biodiversity and tackling the urban heat island effect.

"The Nature Based Cities initiative responds to a gap in the suite of tools currently used by the property development sector, which don't provide sufficient incentive, or recognition, for the integration of landscaping and greenery."

For apartment buyers, the shift is also changing the questions worth asking.

Rather than assuming a sustainable building will naturally include abundant green space, buyers are increasingly being encouraged to look beyond environmental ratings and ask what nature is actually being delivered. How much tree canopy will the development create? Has biodiversity been considered? Are landscaped spaces designed for people as well as appearance?

As Australia's cities continue to grow upwards and outwards, the next generation of sustainability may not simply be measured by lower emissions, but by how successfully developments bring nature back into everyday urban life.

What does it really mean for a building to be 'green'?

Sydney’s property market is known for high prices, competitive bidding, and mounting pressure on first home buyers. But change is on the horizon.

From late 2025, eligible first home buyers in New South Wales will have access to a new federal government initiative aimed at addressing affordability: the Help to Buy Scheme.&nbsp;

<h2>What is the Help to Buy Scheme?</h2>

The program introduces a shared equity model intended to reduce the upfront cost of entering the property market, particularly in high-demand urban areas such as Sydney.

The scheme operates under a shared ownership structure in which the federal government takes an equity stake of up to 40 per cent for new homes, or 30 per cent for existing dwellings. This arrangement allows eligible buyers to significantly reduce their loan size and avoid the added cost of Lenders Mortgage Insurance (LMI).

Under this model, purchasers can enter the property market with as little as a two per cent deposit, well below the traditional 10 to 20 per cent usually required. The government’s contribution is not a loan but a co-ownership stake in the property. As such, there is no interest or rent charged on its portion.

Because the government’s equity combined with the buyer’s deposit typically meets or exceeds the 20 per cent threshold, LMI does not apply. The remaining balance, generally between 60 and 70 per cent of the property’s value, is financed through a standard home loan with a participating lender.

The government's equity in the property remains in place until the buyer chooses to repay it voluntarily or until the property is sold. Buyers can buy back the government’s share over time, in increments of at least five per cent, depending on their financial situation.

There is no fixed repayment timeline, but the amount to be repaid will be based on the property's market value at the time of repayment, not the original purchase price.

<h2>How do you qualify for the&nbsp;Help to Buy Scheme?</h2>

To qualify for the Help to Buy Scheme, applicants must meet the following conditions:

<ul>
	<li>Be an Australian citizen at least 18 years of age.</li>
	<li>Be a first-home buyer who does not currently own property.</li>
	<li>Intend to live in the property as their primary residence.</li>
	<li>Earn less than $100,000 per year for individuals, or $160,000 for couples.</li>
	<li>Purchase a property within the regional price caps, currently $950,000 in Sydney, though this is expected to rise to approximately $1.3 million ahead of the program’s launch.</li>
</ul>

While the Help to Buy Scheme does not solve affordability challenges across the board, it does offer a more accessible pathway for a defined segment of the market, particularly younger buyers with moderate incomes who have been priced out of traditional lending routes.

The scheme is expected to commence in NSW in late 2025, as part of a national rollout.

Under the new model, purchasers can enter the property market with as little as a two per cent deposit, well below the traditional 10 to 20 per cent usually required

Help to Buy Scheme: What first home buyers in NSW need to know

The First Home Owners Grant (FHOG) is a government initiative designed to help eligible first-time home buyers by offering financial assistance towards the purchase or construction of a new home.

While the FHOG is a nationwide program, it is administered separately by each state and territory, meaning the eligibility criteria, grant amounts, and property requirements can vary depending on your location. This means that the amount available and the conditions attached to the grant will differ, so it is important to check the specific guidelines for your state or territory.

It’s important to note that the FHOG is just one of several incentives available to first home buyers. In most states and territories, the grant is not linked to stamp duty exemptions or concessions, with the exception of the Australian Capital Territory (ACT). The FHOG is typically a one-off payment, reducing the overall cost of purchasing or building a new home before any stamp duty concessions are applied.

Below, we provide a breakdown of the First Home Owner Grants available across Australia, outlining the specific details for each state and territory.

<h2>New South Wales First Home Owner Grant</h2>

First Home Owner Grant: Offers a $10,000 grant for new homes valued up to $600,000. For land purchases and owner-builders, the threshold extends to $750,000.

Stamp Duty Benefits: Provides full stamp duty exemption for homes valued up to $800,000, with concessions available for properties up to $1 million.

<h2>Victoria South Wales First Home Owner Grant</h2>

First Home Owner Grant: Provides a $10,000 grant for first-home buyers purchasing or building new homes valued up to $750,000.

Stamp Duty Benefits: Offers full stamp duty exemption for properties up to $600,000, with concessions available up to $750,000.

<h2>Queensland First Home Owner Grant</h2>

First Home Owner Grant: Offers $30,000 for contracts signed between 20 November 2023 and 30 June 2025. The FHOG applies to new homes valued up to $750,000.

Stamp Duty Concessions: Provides additional concessions for properties valued up to $800,000.

<h2>Western Australia First Home Owner Grant</h2>

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First Home Owner Grant: Offers a $10,000 grant for new homes valued up to $750,000 in the southern regions and up to $1 million in the northern regions.

Stamp Duty Concessions: Available for homes valued up to $600,000 for transactions entered into on or after 9 May 2024.

<h2>Australian Capital Territory First Home Owner Grant</h2>

First Home Owner Grant: Replaced by the Home Buyer Concession Scheme, offering full stamp duty concessions for eligible buyers.

<h2>South Australia First Home Owner Grant</h2>

First Home Owner Grant: Provides up to $15,000 for new homes, including houses, apartments, and townhouses. As of 6 June 2024, there is no property value cap for eligibility.

Stamp Duty Relief: Available for new homes and vacant land purchases.

<h2>Tasmania First Home Owner Grant</h2>

First Home Owner Grant: Offers a $10,000 grant for new homes and off the plan purchases.

Stamp Duty Exemption: Between 18 February 2024 and 30 June 2026, first home buyers of established homes valued up to $750,000 receive a full exemption on property transfer duty.

<h2>Northern Territory First Home Owner Grant</h2>

First Home Owner Grant: The Northern Territory provides a $10,000 grant for new homes only. Additional government grants and concessions are available for first home buyers.

Stamp Duty Exemption: The only stamp duty exemption available to property buyers is the House and Land Package Exemption (HLPE).

Eligibility criteria and application processes differ across states. Prospective buyers should refer to their respective state revenue offices for full details on grant availability, conditions, and additional concessions.

Every First Home Owner Grant for new property by state

In the ever-evolving landscape of sustainable architecture and environmentally conscious design, systems and ratings in place can help determine the energy efficiency of residential buildings in Australia.

Australia has multiple building rating systems that evaluate energy efficiency and sustainability in existing and new building designs.

Some systems assess individual building components, while others provide an overall rating for the entire structure.

A rating system ensures that homes are comfortable and energy-efficient, whether you are buying, renovating, or building.

NatHERS (Nationwide House Energy Rating Scheme) is a common way for new homes to meet energy efficiency requirements.

As new developments continue to shape the urban environment, understanding NatHERS ratings becomes essential for developers and homeowners. This article delves into the concept of NatHERS ratings, their significance, and how they contribute to creating energy-efficient homes.

<h2>What is NatHERS?</h2>

NatHERS is a national initiative implemented by the Australian government to promote energy efficiency in residential buildings. The scheme aims to provide a standardised method for assessing the thermal performance of homes, considering factors such as insulation, orientation, ventilation, and building materials.&nbsp;

NatHERS ratings are the most common way new homes meet the National Construction Code's (NCC's) minimum energy efficiency requirements.&nbsp;

NatHERS assessments provide thermal and whole-home ratings for new homes, townhouses, and apartments.

The rating helps evaluate the energy performance of buildings, guides homeowners and developers to make informed decisions about the energy efficiency of their properties, and encourages the construction of more sustainable, comfortable, and cost-effective homes.

<h2>How NatHERS Ratings Work</h2>

NatHERS ratings are determined through four accredited software tools (AccuRate, BERS Pro, FirstRate5, HERO) using a calculation engine CSIRO developed to predict building temperature based on various factors.

The tools can model complex effects of building mass, insulation, window size, and other elements.

The outcome is a star rating that reflects the building's overall thermal efficiency, indicating how well it can maintain a comfortable indoor temperature without excessive reliance on heating or cooling systems.

The star rating scale ranges from 0 to 10, with a 6-star rating being the minimum requirement for compliance with the National Construction Code (NCC).&nbsp;

Achieving a higher star rating demonstrates a commitment to energy efficiency and sustainability, as the building is better equipped to minimise its environmental impact and reduce long-term energy costs.

Anyone can use NatHERS tools, but accredited assessors can provide certified ratings and professional advice.

<h2>Benefits of Higher NatHERS Ratings</h2>

Energy Efficiency: Buildings with higher NatHERS ratings are more energy-efficient, requiring less heating and cooling energy. This reduces the structure's carbon footprint and lowers occupants' energy bills.

Cost Savings: Homes with higher NatHERS ratings are generally more energy-efficient, resulting in reduced energy consumption for heating and cooling. This translates to lower energy bills for homeowners, making sustainable living environmentally friendly and economically viable in the long run.

Environmental Impact: Lower energy consumption directly translates to a reduced environmental impact. Buildings with higher NatHERS ratings contribute to the overall goal of mitigating climate change by lowering greenhouse gas emissions associated with heating and cooling systems.

Improved Comfort: Buildings with high NatHERS ratings offer better thermal comfort to occupants. Proper insulation, well-designed ventilation, and optimal orientation maintain a consistent and comfortable indoor temperature, providing occupants with a more enjoyable and healthier space.

Market Value and Desirability: Higher NatHERS ratings can enhance the market value of a property. As energy efficiency becomes a more significant consideration for homebuyers, a well-rated building may attract a premium price and stand out in the real estate market.

Compliance with Building Codes: NatHERS ratings are a vital component of the National Construction Code (NCC), and compliance with these ratings is often a mandatory requirement for new developments. Local councils and planning authorities may set minimum energy efficiency standards that must be met to obtain development approval.

The Nationwide House Energy Rating Scheme (NatHERS) is a crucial initiative shaping the future of energy-efficient, resilient, and cost-effective homes. With its recent upgrades, NatHERS has evolved into a world-leading tool for the building sector, supporting the global commitment to achieving net-zero emissions by 2050.

Staff Writer

What is a NatHERS rating in new off the plan apartment developments?

Mixed-use developments have gained significant popularity across Australia in recent years due to their unique blend of residential, commercial, and recreational spaces.

Unlike traditional single-purpose developments, mixed-use projects offer a harmonious integration of various functions within a single locale.

Residential units seamlessly coexist with commercial establishments, retail outlets, dining venues, entertainment hubs, and recreational facilities, with the combination not only enhances convenience but also fosters a vibrant lifestyle and a sense of community.

<h3>Convenience and accessibility</h3>

Mixed-use developments are designed with convenience in mind. They often integrate residential units with commercial spaces, retail outlets, restaurants, and recreational facilities, creating a self-contained community.

[smartcode_project:default project_id=114215 project_image_fid=204874]

The proximity allows residents to enjoy the convenience of having essential amenities and services within walking distance. Whether it's grabbing a cup of coffee, going grocery shopping, or accessing healthcare services, everything is conveniently located, saving residents time and effort.

<h3>Vibrant lifestyle and community</h3>

One of the major advantages of mixed-use developments is the vibrant lifestyle they offer. With a diverse range of amenities and communal spaces, residents have ample opportunities to interact, socialise, and build a sense of community.

[smartcode_project:default project_id=107714 project_image_fid=214122]

The presence of parks, community centres, and shared spaces fosters a lively atmosphere, encouraging residents to engage in various activities and events. The vibrant lifestyle within these developments creates a unique sense of belonging and camaraderie among the residents.

<h3>Potential for higher rental yields and property value appreciation</h3>

Mixed-use developments tend to attract a broad range of tenants and buyers due to their versatile nature. This high demand can result in higher rental yields for investors and potentially lead to property value appreciation over time.

[smartcode_project:default project_id=139989 project_image_fid=212887]

The integration of commercial and retail spaces attracts businesses, which can provide a stable rental income stream. Additionally, the popularity of mixed-use developments often drives up property values, making them a potentially lucrative investment in the long term.

<h3>Enhanced security and maintenance</h3>

Mixed-use developments typically have comprehensive security measures in place. With controlled access points, CCTV surveillance, and professional security staff, residents can enjoy enhanced safety and peace of mind.

[smartcode_project:default project_id=108019 project_image_fid=212658]

Additionally, these developments often have dedicated maintenance teams responsible for the upkeep of common areas, landscaping, and infrastructure. This ensures that the overall appearance and functionality of the development are well-maintained, creating a pleasant living environment for residents.

<h3>Live-work-play balance</h3>

One of the key attractions of mixed-use developments is the ability to achieve a desirable live-work-play balance. The integration of residential and commercial spaces allows residents to live closer to their workplaces, reducing commuting time and improving work-life balance.

The proximity to various amenities and recreational facilities encourages an active and healthy lifestyle. Residents can easily access fitness centres, parks, restaurants, and entertainment options, all within the same development, leading to a more fulfilling and convenient way of life.

alisonwarters@gmail.com

The top five reasons to buy in a mixed-use development

When buying a property, everyone needs to be aware of the additional costs that come as part of the buying process.

Often the largest outlay, after the deposit which goes to the bank, is stamp duty.

<h2 style="line-height: 1.38;">What is Stamp Duty?</h2>

Stamp duty is an extra tax to pay the government when you buy land, a property, and other certain assets.

It happens when the legal ownership is transferred. It can also be known as property transfer duty or transfer duty.

<iframe allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="" frameborder="0" height="415" src="https://www.youtube.com/embed/C32BWkB5--c" title="YouTube video player" width="660"></iframe>

<h2>Who pays Stamp Duty?</h2>

In some circumstances, you may get an exemption. For some states, you won’t have to pay for stamp duty if you are a first home buyer or a pensioner for houses under a particular price. There are also stamp duty concessions, where you may be entitled to a discount.

<h2>How much does Stamp Duty cost?</h2>

Each state has different rules which affect how much you need to pay. These rules can affect the rate you pay, and the timeframe you will need to pay in. Before you buy land or a property, make sure you check the up-to-date information for your state’s stamp duty.

You can use a free stamp duty calculator online to see approximately how much you’ll need to pay. Find out if you’re eligible for an exemption by enquiring on a project via Urban!

Overall, the stamp duty you need to pay will depend on:

<ul>
	<li aria-level="1">How much your land/property is worth</li>
	<li aria-level="1">Where your land/property is located</li>
	<li aria-level="1">What type of land/property it is</li>
</ul>

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Ellen Walker

Off-the-plan property explained: What is stamp duty?

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Mining towns dominate the latest list of real estate investment No -Go Zones compiled by national property analyst Terry Ryder.
The 2011 list includes the mining towns of Kalgoorlie and Mount Isa, as well as iconic sea-change locations Byron Bay, Gold Coast and Noosa.
“Mining towns have great allure for property investors because they often provide high rental returns and rapid capital growth,” Ryder says.
“But mining towns are among the most perilous locations for investors. They sit at the extreme far end of the risk spectrum.
“Mining towns have volatile markets that depend on buoyancy in the resources sector,” he says.
“Often the prices and rents in mining towns are sustainable only while a resources boom lasts.”
Ryder’s comments preceded the June quarter figures from the Real Estate Institute of Western Australia that show property in the Pilbara cooled a little, with the Port Hedland median pulling back by 5% and Karratha by 9%.
Real Estate Institute of Western Australia president Alan Bourke notes the market has been “extraordinary” in the iron ore belt.
Ryder, the founder of the <a href="https://www.hotspotting.com.au" title="hotspotting.com.au" target="_blank">www.hotspotting.com.au</a> website, which focuses on forecasting Australia’s next property hotspots, has also nominated sea change locations among his leading ‘anti-hotspots’ locations.
For example, Ryder believes one of the least-known factors in Australian real estate is that iconic sea-change locations tend to have poor capital growth records.
“Investors often assume that locations that have high population growth and/or strong tourism markets will be real estate hotspots, showing superior growth.
“In reality such locations often deliver inferior gains for investors,” he says.
“The Gold Coast, Sunshine Coast and Byron Bay are prime examples of iconic sea-change areas that are not prime real estate performers for investors.”
“These three famous sea change locations don’t have a great record on price growth, with the Gold and Sunshine coasts plagued by over-supply and falling prices and Byron Bay facing court battles and erosion issues.”
Ryder also describes master-planned communities as having “lots of bells and whistles” but poor long-term capital growth.
He says urban renewal sites in Melbourne affected by oversupply may have had concerns about site contamination issues.
He considers prestige suburbs in capital cities as being over-heated and over-valued.
The full list of hotspotting.com.au 2011 No-Go Zones are:
<ul>
<li>Master-planned communities – expensive, poor long-term capital growth</li>
<li>Mining towns (general) – volatile, dependent on one industry, pollution issues</li>
<li>Mining towns (Kalgoorlie) – falling prices, poor rental returns, volatile</li>
<li>Mining towns (Mount Isa) – falling prices, poor capital growth, pollution</li>
<li>Population growth leaders – oversupply, high vacancy rates, lower capital growth</li>
<li>Prestige suburbs major cities – overvalued, volatile, unaffordable, lower capital growth</li>
<li>Sea change icons (Byron Bay) – expensive, erosion, court battles</li>
<li>Sea change icons (Gold Coast) – expensive, oversupply, tourism downturn</li>
<li>Sea change icons (Noosa) – underperforming, unaffordable, inferior capital growth</li>
<li>Urban renewal sites (Melbourne) – poor capital growth, oversupply, contamination</li>
</ul>
Ryder has been fairly consistent in his inclusions, as last year’s no-go list featured Byron Bay and Queensland's Sunshine Coast and Gold Coast. It also included prestige Melbourne suburbs, Mount Isa in Queensland, Kalgoorlie in Western Australia and the Roseberry/Zeehan area in Tasmania.
Ryder, a specialist property writer, is the author of four books about real estate and compiles the no-go zones list each year for his website.
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jchancellor-FAypfDUnLy

Mining towns not rivers of gold: Terry Ryder

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The amount of commercial finance loans written by banks has soared in June, according to the latest ABS figures.
In June banks wrote a total of $34.7 billion worth of commercial loans, up from $29.4 billion in April. The sector accounts for 93% of all commercial loans written in Australia.
As with housing finance, and personal lending, banks were the only beneficiaries in a month when commercial finance fell 6.5% on a seasonally adjusted basis following an increase of 8.8% in May.
The latest figures come as the Commonwealth Bank revealed a 22% increase in second-half profits on the back of increased business and household lending.
At the same time smaller developers continue to have problems obtaining finance for commercial developments.
Revolving commercial credit commitments fell 8.4% and fixed lending commitments fell 5.6% over the month.
Since December 2010 when commercial finance commitments increased from $30.5 billion to $32.8 billion, commercial mortgages have followed a pattern of falling one month and rising the next.
The decline in June takes commercial mortgage commitments below the $30.1 billion achieved in October 2010.
Personal lending fell marginally in June, with commitments of $6.99 billion, compared with $7.05 billion in May and $6.82 billion in April.
Banks share of personal lending stands at 85% – banks wrote $6.8 billion out of $8 billion of personal loans in June
Leasing suffered the biggest monthly drop, falling 7.2% to $374 million.
As revealed yesterday, owner-occupier mortgages remained flat at $14.1 billion.
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lschlesinger-FZcF9M3vE6

Banks big winners in commercial finance slump

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There can be little doubt that the latest turmoil in share markets will trigger a decision by many super fund members towards a greater property investment.
Some will choose to do so changing their exposure through their existing industry funds, while others will decide to do it through self-managed super funds.
Given the overly high allocation of shares in the typical balanced super portfolio, Australian super fund members are particularly vulnerable to every tumultuous swing in the world’s share markets.
The pro-property push will come not necessarily because Australian funds have underperformed the OECD average in the GFC aftermath. (And pity those whose assets have not recovered in the six OECD countries in local currency terms; Belgium, where assets are 10% lower than in 2007; Ireland, 13%; Japan, 8%; Portugal, 12%; and Spain and the US, which were both down by 3%.)
But the shift towards bricks and mortar will come rather from the desire to control one’s own destiny and forego the anxiety of waking up to find one’s fate after the overnight trading on Wall Street.
The Organisation for Economic Co-operation and Development report on pensions found Australian funds had the third-highest exposure to shares in the developed world.
About 46% of super money was invested in equity markets. The June 2010 report noted the best-performing funds were in New Zealand (10.3%), Chile (10%), Finland (8.9%), Canada (8.5%) and Poland (7.7%).
In most OECD countries bonds were by far the dominant investment class, accounting for at least half the funds' investments. Australian funds typically have 11 per cent in bonds, and about 15% in cash and deposits.
Countries including the United States, Finland and Chile were others that showed significant portfolio allocations to equities, in the range of 40% to 50%.
Of course the bias towards shares helped compulsory super funds produce strong returns when the stock market was rising.
But the latest unsettling share market turmoil comes at a time when SuperRatings managing director Jeff Bresnahan says many funds had yet to regain all the losses suffered during the GFC.
“To say 2012 is shaping up to be a challenging one is a mild understatement, with ongoing European debt crises, political jousting in the US, massive daily stock market swings and now the threat of recession,” Bresnahan notes.
No doubt many fund members will be switching to a more conservative investment option within their existing funds, and the super industry will be content to keep them in the tent.
But the latest episode in stock market turmoil will trigger an exodus towards self-managed super funds with property investment prospects at top of mind.
Jeremy Cooper, who chaired last year's review of the super industry, acknowledged this week that the industry funds had a “one-size-fits-all soup of assets.”
“And that may need to change, especially in retirement where people feel losses the most.''
''I get the sense people are saying not again, and are overwhelmed by the powerlessness of it all,'' Cooper, who is the head of Challenger retirement income division, told the SMH.
Cooper says the recent sell-off was irrational, and that small investors worried about their superannuation portfolios ought to have a cup of tea and leave it to the experts.
Since it was the share market and super industry experts at whom much of the blame rests, the property industry stands ready in anticipation of an investment fillip once the mums and dads have had that cuppa.
Let’s just hope the shift is orderly.
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Bricks and mortar will be more investors' cup of tea after turmoil

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Let’s face it, we don’t have expensive housing in Australia, we have expensive land.  The average cost of residential land overtook the median cost of constructing a dwelling, across all Australian capitals, about five years ago.  The difference between the two is now considerable and growing.  Volume builders in Queensland are constructing quality new detached homes for well under $1,000 per square metre. 
The proof is readily available.  Across the south-east corner of Queensland, for example, the price of vacant land per metre is now 2.3 times (230%) what is was a decade ago.  Established house prices (which include the price of land) also increased, but at a lower rate – they are 1.5 times (150%) the price a decade ago.  The cost of new project homes, which exclude the cost of land, are just 0.65 times (65% higher) what they were a decade earlier. 
Land is expensive because we have a shortage of it.  To the rest of the world, such a statement would be bordering on lunacy. Australia is one of the most spacious countries – based on total land area per capita – in the western world, after all.  And yet, ironically, we are one of the most urbanized places on the planet. 
Over-governance, green politics and town planning tomfoolery are corralling us into a handful of already crowded places.  This has created a shortage of land, driving up its price and resulting in fewer economically feasible developable sites.  Land now accounts for about two-thirds of the cost of a new home in our major capitals and close to half in our regional centres. 
There is no better place to illustrate how out of whack the system is than on the Gold Coast.  The Queensland Government and the local council are doing everything they can to make housing on the Gold Coast unaffordable, and in turn, undermining employment. 
Despite what we read in the daily press, the Gold Coast market – in terms of total stock – isn’t oversupplied.  There is just way too much of the wrong stock and too little of that which is in demand. 
The oversupplied stock consists largely of apartments, mostly in high-rise towers and priced over $800,000.  By default, this targets a short-term tourist market, which for the most part cannot afford to pay the tariffs.  In contrast, apartments under $600,000 are undersupplied but are suffering collateral damage, so to speak, given the negative commentary about the apartment market in general on the Gold Coast. 
There isn’t enough new detached housing or new townhouse development on the Coast.  The SEQ Regional Plan (which covers a time period from 2008 to 2031), expects 77% of new development on the Gold Coast to be “infill” i.e. medium and high-rise dwellings.  However, just three years into the plan, only half of the new starts are in “infill” areas.  The demand for detached housing is rising and is currently about 70% of the overall demand.  It can only be provided, and at an affordable price, on “greenfield” sites.  There are plenty of these sites available on the Gold Coast. 
There is little government can, or should, do about the price of “infill” real estate.  But there’s a lot they can and should do about affordable housing in “greenfield” areas.  This is where there’s an infinite supply of land available and a housing industry ready, willing and able to build top-quality houses at unbelievably low prices. 
The Gold Coast doesn’t just need a new police helicopter, the Commonwealth Games or even a light rail system; what it needs is jobs.  Close to 25% of the region’s economic growth comes from new construction, with over 30% of its workforce employed (directly and indirectly) in the building trade.  It needs much more new detached housing. 
It also needs to open up its industrial land bank to new business.  It must incentivize new operations to move to the Coast.  It should be all about permanent jobs and industries which have higher employment multipliers, rather than one-off feel-good events, white elephants and election stunts. 
Thousands of people are being denied the opportunity to replicate what those now running the show were able to do, i.e. to get a start in the housing market.  This is not only socially and economically unsound, but morally wrong!
Michael Matusik is the director of independent property advisory Matusik Property Insights. Matusik has helped over 500 new residential developments come to fruition and writes the weekly  <a title="Matusik's Missive" target="_blank" href="https://matusikmissive.wordpress.com/">Matusik's Missive</a>.
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michaelmatusik-49YzLvdmNv

Residential land is overpriced

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While we’re in uncharted territory in our financial markets and many investors are confused and concerned, older and more experienced investors have lived through similar times before. If you look back over the last decade, we’ve had the introduction of CGT, the dot-com stock market crash, September 11th, gone to war overseas, a change of government, periods of high interest rates and low interest rates, the GFC and a myriad other factors out of our control that seemed scary at the time and created uncertainty for our investments. The big lesson is: “This too shall pass.” 
Unfortunately these problems will not go away quickly, and we are entering new era in the financial markets. But this is not a time to panic or make rash emotional decisions. It is a time to learn from history. 
You just have to look back a few years to the correction after the GFC when local share prices plummeted 50%, but the peak-to-trough fall in Australian home values was just 3 to 4%. 
Compared with shares, property performed very well. 
It was much the same in 1987, when the share market crashed and property values languished for a while before property boom that created fortunes. 
This as also true after the dot-com boom collapsed into what became known as the “tech-wreck” in 2001. Many investors will remember the property boom of 2001-03. 
There’s no denying that things are probably going to get worse before they get better. 
However, if history repeats itself, as it surely will, while the majority of Australians will sit on the sidelines feeling sorry for themselves, successful investors are looking for and buying investment opportunities created by the change.
As always, some people will thrive not just survive in these difficult times.
Michael Yardney is the director of <a href="https://www.metropole.com.au/">Metropole Property Investment Strategists</a> , a best-selling author and one of Australia's leading experts in wealth creation through property. He also writes the <a href="https://www.propertyupdate.com.au/">Property Investment Update</a> blog.
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myardney-DFoGhGbSJX

Lesson in turbulent market: This too shall pass

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REITs have defensive characteristics because a large part of their total return typically comes from dividends, and these dividends are derived from multi-year leases, which are not immediately impacted by short-term equity market turmoil.
The most defensive REIT sector has traditionally been the high-quality retail sector, and in particular REITs which have a strong exposure to quality grocery/drug store-anchored community retail centres - centres focusing on so-called "necessity retail".
However, during the last downturn REIT stock performance was highly correlated to bank stock performance, and of course in the last few days bank stocks, in America in particular, have been battered.
That said, today's REITs generally have stronger balance sheets than prior to the GFC. The question of refinancing availability should be a less pressing question than in the past, when high leverage, falling asset values and the use of short-term financing created a perfect storm for some REITs.
The current situation obviously raises questions about future occupier demand, property occupancy and rent growth.
If investors believe modest growth is possible over the next few years in the major Western property markets, the ability to buy REITs at prices that have now been pushed below NAV by the current crisis may prove to be an attractive and somewhat defensive investment option.
Martin Lamb is head of property, Asia-Pacific, for <a href="https://www.russell.com/au/" title="Russell investments" target="_blank">Russell Investments</a>.
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mlamb-ry85zC4DDu

REITs can be a safer way to invest in volatile market

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The “time to buy a dwelling” sentiment dropped by 3.9% in the latest Westpac-Melbourne Institute Index of Consumer Sentiment.
But the level interest still sits as above the index lows of earlier this year. The index tracking views on whether it was time to buy a car fell by an even sharper 6.2% to register the lowest point since 2008.
The overall Westpac-Melbourne Institute Index of Consumer Sentiment fell by 3.5% in August from 92.8 in July to 89.6 in August.
“Coming after a fall of 8.3% in July, this latest fall is sending a significant message,” Westpac chief economist Bill Evans says.
The Index is now at its lowest level since May 2009 based on the survey conducted over the period August 1 to 6.
Some 76% of respondents had answered the survey before Friday, August 5, when confidence was jolted by turmoil in global financial markets with the reported 4.3% fall in the Dow Jones Index of US shares and the 4.2% fall in the Australian Index.
For the period before August 5 the Index was at 91.4 and for respondents in the period of August 5 to 6 the Index stood at 83.9.
“The index had fallen by 1.6% even before the financial turmoil,” Evans notes.
“As expected this financial turmoil has added another dimension of risk to consumers over and above those issues associated with interest rates, house prices, carbon tax, and potentially, jobs.”
The modest fall in sentiment is despite the Reserve Bank holding rates steady at its recent meeting and (until recently) a surging Australian dollar. It comes after an 8.3% fall from already low levels and clearly points to the consumer remaining cautious.
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Houses perhaps but certainly cars off the shopping list as consumer sentiment falls

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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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Westfield Group will spend $440 million to acquire a half-share of a Brazilian shopping mall owner, marking a long-awaited move into a new geographic retail market.
Westfield, which currently owns or has interests in 119 centres in the US, UK, Australia and New Zealand, will buy 50% of Almeida Junior Shopping Centers SA, giving it an interest in five malls in southern Brazil and two currently under development.
Almeida Junior is one of the eight largest Brazilian companies operating in the shopping centre sector.
"Today's announcement represents an exciting and significant strategic investment for the group, which expands our global franchise into this large and high-potential market,” Westfield chairman Frank Lowy said in a statement.
"This is our first new market entry since we entered the United Kingdom in 2000 and follows the restructure of the group in late 2010.
“Whilst the climate in the world financial markets is volatile at present, this transaction is in the group's long term investment and funding plan, and one we have been investigating for an extensive period of time."
The Brazilian company, led by its founder and CEO Jaimes Almeida Junior, has been operating shopping centres in Brazil since 1993.
Westfield Group co-CEO Steven Lowy says the underlying characteristics of the Brazilian market combined with a strong and diversified local retailer base and growing consumer spending make Brazil a strategic long-term growth opportunity for the group.
Brazil is the seventh-largest economy in the world, with a GDP of approximately US$2.1 trillion and a population of approximately 190 million people. Brazil’s economy has grown substantially over recent years, as has its middle-class population. More than 110 million people in Brazil are now considered to be middle class or above.
Retail sales have grown strongly since 2000, with shopping centres in Brazil representing only 18% of the country's total retail sales, compared with 52% in the United States and 41% in Australia. In addition, shopping centre space per capita of population is relatively low in Brazil, at 0.05 square metres per person, compared with 1.37 square metres  in the US, 0.54 square metres in Australia and 0.21 square metres in the United Kingdom. The ownership of shopping centres is also highly fragmented.
The underlying characteristics of the shopping centre industry in Brazil are similar to the other markets in which WDC operates. There is an established industry of anchor-based centres, with the majority of income sourced from a wide offer of local and international specialty stores on mainly five-year lease terms and rents, similar to Australia, indexed annually to inflation. The average size of a specialty store in the company's portfolio is smaller than in WDC's existing markets at approximately 70 square metres.
Under the terms of the transaction, Westfield will invest a total of R$740 million (A$440 million) in acquiring a 50% interest in the company, valuing the company at R$1,480 million (A$880 million). The valuation for the company represents an 11.2 times EBITDA multiple on first-year forecast earnings.
WDC's investment includes a direct capital injection into the company of R$400 million (A$240 million), which will give the company a net debt of zero and provide it with the capacity to grow over time.
The company owns and manages three existing shopping centres throughout the state of Santa Catarina, a high-income demographic region of Brazil with a population of 6 million people. It will also continue the development of two new shopping centres in Blumenau and Florianopolis (the capital of Santa Catarina), with completion expected by year end 2011 and 2012, respectively. The company will have a 55% market share of the shopping centre space in the state.
The total portfolio comprises approximately 157,000 square metres of retail space, with almost 900 stores. The sales productivity for the centres is high with occupancy cost ratios for the established centres at the lower end of the industry's peers.
The company is based in Sao Paulo and employs approximately 1,000 people.
WDC will be directly involved in the management and growth of the company.
As a result of the transaction, the group's assets under management will increase by almost A$1 billion. The group expects to achieve an unlevered internal rate of return in excess of 15% on its invested capital.
The transaction is expected to be earnings positive and is forecast to contribute 0.3¢ to Funds from Operations in 2012. The accretion is expected to increase further in future years as a result of both the income growth from Westfield Almeida Junior's existing portfolio as well as the anticipated growth in the overall size of the business.
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