<p><a href="https://www.apartments.com.au/developers/s-p-setia">SP Setia</a> has lodged plans for a $750 million, three-tower mixed-use precinct that would complete the long-running redevelopment of Carlton's former Carlton United Breweries site.</p>

<p>The proposal at <a href="https://www.apartments.com.au/new-apartments/185-195-queensberry-street-carlton-vic-3053">46-78 Bouverie Street and 185-195 Queensberry Street</a> spans a 6,468 sqm site, the last remaining undeveloped parcels within the former brewery's 2007 masterplan.</p>

<p>Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the development will comprise two purpose-built student accommodation towers and a third build-to-sell apartment tower above a shared commercial podium and basement.</p>

<p>Across the three towers, SP Setia is proposing 606 build-to-sell apartments and 1,499 student accommodation units containing 2,009 beds.</p>

<p>The apartments will sit in the tallest tower, which will rise nearly 200m and 55 storeys. It will become&nbsp;one of the more substantial new build-to-sell apartment projects at the northern edge of Melbourne's CBD.</p>

<p>The apartment mix is weighted toward smaller inner-city product, with 188 studios, 206 one-bedroom apartments, 192 two-bedroom apartments and 20 three-bedroom apartments</p>

<p><img alt="First look: SP Setia plans three-tower finale for Carlton’s former CUB precinct" data-entity-type="file" data-entity-uuid="8271bc87-1b0a-41b7-ac73-a425ee375261" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/3_2.png?VersionId=G4lw23o90B1boX4k4dj7rdz2ZEajS9wy" /></p>

<p>Part of the precinct will be a large-scale&nbsp;3,684 sqm supermarket and a further 2,198 sqm of speciality retail, creating close to 5,900 sqm of new commercial space within the precinct.</p>

<p>But one of the biggest components of the proposal is what sits between the buildings.</p>

<p>Around 4,650 sqm, or roughly 72 per cent of the site, will be publicly accessible open space, incorporating plazas, pedestrian connections, landscaped laneways and retail spill-out areas.</p>

<p>The ground plane is intended to finally complete pedestrian connections envisaged when the CUB masterplan was first approved nearly two decades ago, stitching together Victoria Street, Queensberry Street, Bouverie Street and Swanston Street through the former brewery precinct.</p>

<p>Urbis said the development would "complete the CUB precinct", with the public realm providing important north-south and east-west connections through what is currently the final undeveloped portion of the masterplanned site.</p>

<p>SP Setia is also exploring a new linear park within the Bouverie Street road reserve, with the concept to be developed further with the City of Melbourne through the planning process.</p>

<p>The proposal is being pursued through the Victorian Government's Development Facilitation Program under Clause 53.23 for significant residential development with affordable housing.</p>

<p>The planning report acknowledges the proposed heights exceed those contemplated under the original Comprehensive Development Plan and masterplan, but argues the built-form context has changed considerably over the past two decades.</p>

<p>Urbis said the three towers would instead create a stepped transition between Carlton and the Hoddle Grid, rising progressively from the 94.1-metre Tower One along the Queensberry Street edge to the 199.44-metre Tower Three closer to the established CBD-scale buildings to the south.</p>

<p><img alt="SP Setia" data-entity-type="file" data-entity-uuid="e885a07a-592c-40fc-bf82-e6dbaf32da54" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.52.24%E2%80%AFAM.png?VersionId=7s_ErUkSKAdY1mAWp3GRZgMNCGtwhk5m" /></p>

<p>SP Setia plans to deliver the development across three stages.</p>

<p>Stage One would deliver the basement, podium and retail areas for the entire precinct alongside the first student tower. Tower Two would follow in Stage Two, before the 606-apartment Tower Three is delivered as the final stage.</p>

<p>If approved and delivered, the project would close out a redevelopment process that has been underway since the former brewery masterplan was approved in 2007, adding more than 2,600 student beds and apartments to a precinct already home to Swanston Central, the Barak Building, RMIT Design Hub and several large student accommodation developments.</p>

<p>&nbsp;</p>

<p>&nbsp;</p>


Joel Robinson

SP Setia plans three-tower finale for Carlton’s former CUB precinct

<p>Melbourne developer Lowe Living is seeking to add to its growing bayside apartment pipeline, filing plans for a boutique eight-residence development in tightly held Middle Park.</p>

<p>Lowe Living, which has built much of its development portfolio across Melbourne's affluent bayside and south-east suburbs, is behind the plans for the 730 sqm site at <a href="https://www.apartments.com.au/new-apartments/123-125-erskine-street-middle-park-vic-3206">123-125 Erskine Street</a>, just off Armstrong Street and within the Armstrong Street Neighbourhood Activity Centre.</p>

<p>The developer is seeking approval for a five-storey residential building above two basement levels, with just eight large-format apartments and 18 car spaces.</p>

<p>“This is a deliberately very different proposition for us,"&nbsp;Tim Lowe, Co-Founder of Lowe Living, said.</p>

<p>"Eight residences is exceptionally boutique, but that's precisely what this site calls for.</p>

<p>“There is a strong community in Middle Park and the surrounding suburbs who have spent decades building a life here. They no longer want the maintenance of a large period home, but they aren't prepared to compromise on space, quality or location. We think there is a real opportunity to capture that hyper local market. A site like this rarely comes to market.”</p>

<p><img alt="Lowe " data-entity-type="file" data-entity-uuid="875fe572-0f14-4d90-9e11-55b28dd07731" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.42.49%E2%80%AFAM.png?VersionId=GDNQRv9BfpR9r1zkZ5UDyUM4ZvpIksut" /></p>

<p>The low-density proposal has been designed by Cera Stribley and is being progressed through the Victorian Government's Great Design Fast Track pathway, having already secured eligibility from the Minister for Planning.</p>

<p>The Office of the Victorian Government Architect supported its eligibility after finding the proposal demonstrated consistency with the program's seven design principles, while the project's financial feasibility has also been independently confirmed by Invest Victoria.</p>

<p>The project is targeting the downsizer market, with the planning documents describing the homes as larger-format residences and noting the two penthouses could otherwise have been configured as four separate apartments.</p>

<p><img alt="Lowe 2" data-entity-type="file" data-entity-uuid="60ab0987-2da6-4175-adac-315dcf6053c6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.15%E2%80%AFAM.png?VersionId=bOCPH0B2MFwlmaRW.TTCF9TzyifgVoQI" /></p>

<p>The site has dual frontage to Erskine Street and Canterbury Place and currently comprises a collection of commercial buildings used as offices, including a former heritage bakehouse, a former stable, a later gabled addition and a central courtyard.</p>

<p>It sits within the Commercial 1 Zone and the Armstrong Street Commercial Precinct heritage overlay, with the existing property classified as a contributory heritage place.</p>

<p>Heritage has subsequently played a significant role in Cera Stribley's design.</p>

<p>The front section of the former bakehouse facing Erskine Street will be retained, including its return walls, street-facing hipped roof and chimneys, while the Erskine Street façade and part of the western return wall of the former stable will also be incorporated into the new development.</p>

<p>Levels four and five will be set back five metres from the retained stable façade, while bricks removed through demolition are proposed to be salvaged and reused within the new building where possible.</p>

<p><img alt="Lowe 3" data-entity-type="file" data-entity-uuid="e97927a9-a2de-4a0f-83b6-65451238abfa" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-21%20at%208.43.06%E2%80%AFAM.png?VersionId=VR44AChLrX9q1XPB9GvVQV.ALXXbe4gC" /></p>

<p>Rather than presenting as a single five-storey building to Erskine Street, Cera Stribley has broken the development into a series of distinct forms.</p>

<p>A three-storey infill element will sit between the retained bakehouse and stable façades, with the upper levels recessed behind the heritage fabric. Canterbury Place will similarly feature two three-storey podium forms, separated by a central pedestrian accessway, before the upper two levels step back from the street.</p>

<p>A pedestrian through-link will run through the centre of the project between Erskine Street and Canterbury Place, creating entrances from both sides of the site and introducing landscaping and communal areas through the ground plane.</p>

<p>Landscape architect Acre has designed planting across the ground level, private terraces and upper levels, including a feature canopy tree at level three and integrated planting and arbours across the level four terraces. Five existing Erskine Street trees are proposed to be retained.</p>

<p>Sustainability is also a significant component of the Great Design Fast Track application. The apartments are targeting an average eight-star NatHERS rating, with no residence below 6.5 stars, while the project has achieved a 75 per cent BESS score. Seven of the eight apartments are designed for cross-ventilation, with the remaining residence using mechanically assisted natural ventilation.</p>

<p>The plans also incorporate an 8kWp rooftop solar system, a 5,000-litre rainwater tank and infrastructure allowing future electric vehicle charging for every residence.</p>

<p>Lowe has a strong portfolio across Melbourne's blue-chip suburbs. They recently launched <a href="https://www.apartments.com.au/new-apartments/jardin-house-by-lowe-living-camberwell-335-camberwell-road-camberwell-vic-3124">Jardin House by Lowe Living</a> in Camberwell, their first development in the Stonnington LGA.</p>


Lowe Living unveils Middle Park apartment development

<p data-end="288" data-start="269"><strong data-end="288" data-start="269">Article summary</strong></p>

<ul data-end="888" data-start="289">
	<li data-end="442" data-section-id="8tsh6o" data-start="289"><strong data-end="374" data-start="291">DVB Projects is preparing to launch its second Gold Coast apartment development</strong>, with demolition now underway at 137 Old Burleigh Road, Broadbeach.</li>
	<li data-end="573" data-section-id="1nyxl3e" data-start="443"><strong data-end="513" data-start="445">The 34-level tower will comprise just 49 ultra-luxury residences</strong>, including half-floor, full-floor and penthouse apartments.</li>
	<li data-end="717" data-section-id="oiyimj" data-start="574"><strong data-end="646" data-start="576">The launch follows strong demand at DVB's nearby Sea Glass project</strong>, which is more than 50 per cent sold and currently under construction.</li>
	<li data-end="888" data-section-id="epk9o9" data-start="718"><strong data-end="787" data-start="720">The development adds to the transformation of Old Burleigh Road</strong>, with premium beachfront apartment projects continuing to reshape the tightly held Broadbeach strip.</li>
</ul>

<p data-end="1011" data-start="790"><a href="https://www.apartments.com.au/developers/dvb-projects">DVB Projects</a> is preparing to launch its second Gold Coast apartment development, with demolition now underway on the Broadbeach site as the Sydney developer moves closer to bringing the ultra-luxury project to market.</p>

<p data-end="1296" data-start="1013">The 34-level tower at <a href="https://www.apartments.com.au/new-apartments/137-old-burleigh-road-broadbeach-qld-4218">137 Old Burleigh Road</a> will comprise just 49 residences, ranging from half-floor apartments through to full-floor homes and a penthouse. The launch follows the strong sales performance of DVB's nearby Sea Glass development. More than half of the apartments at Sea Glass, on the other side of Broadbeach, have been snapped up, well ahead of its late 2027 completion</p>

<p data-end="1296" data-start="1013"><img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="2944b4be-c84e-4b54-8dc1-c712e76704c0" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E02_Exterior_Street%20Level%20Entrance.jpg?VersionId=YoNig7pRdrE3HCue7sUj78LzJteeQf3H" /></p>

<p>The start of demolition at 137 Old Burleigh Road signals DVB Projects’ underlying confidence in the Gold Coast’s luxury beachside apartment sector.</p>

<p>“We see the Gold Coast as one of the most compelling lifestyle markets in Australia, particularly at the premium end where demand continues to deepen,” said Dean Brown, Managing Director of DVB.&nbsp;</p>

<p>“This project has been carefully designed to respond to that demand - delivering large-format residences with a level of quality, privacy and amenity that is still relatively rare in the apartment market on the beachside."</p>

<p>Brown says the site itself is "exceptional."</p>

<p>"Old Burleigh Road is one of the most tightly held beachfront strips, and opportunities to deliver a project of this scale and calibre in this location are extremely limited.”</p>

<p><img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="398f377a-c037-455e-9250-0c5e0d84c35b" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/I12_FF%20Balcony.jpg?VersionId=NwOiRWGMubR1c8wthuEfggklcja7al9." /></p>

<p>The project will comprise 40 half-floor residences of approximately 260 sqm, alongside eight full-floor residences spanning around 524 sqm.</p>

<p>A single penthouse will crown the building, featuring a private pool, barbecue area, indoor gym and dedicated entertaining spaces.</p>

<p>Residents will have access to a resort-style suite of amenities, including a 20-metre pool with daybeds, a gymnasium, hot and cold plunge pools, a sauna, and private residents’ lounge and dining facilities.</p>

<p><img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="d1642bb0-9a66-4427-a022-dfc0988c6287" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/A02_Pool%20to%20View.jpg?VersionId=c0IXPyn_Gp_Kn3XCwzMrqIVkAdCEwVXP" /></p>

<p>Sales agent Todd Matheson, of <a href="https://www.apartments.com.au/project-marketer/pezet-matheson">Pezet Matheson</a>, which is marketing both 137 Old Burleigh Road and Sea Glass, said 137 Old Burleigh Road would address a clear gap in the market for genuine luxury products.</p>

<p>“There are very few opportunities on the Gold Coast where buyers can secure a residence of this size and quality in a new building,” Matheson said.</p>

<p>“What we’re seeing is a growing cohort of downsizers and interstate buyers who still want space - they’re not willing to compromise on living area, entertaining or finishes.</p>

<p>“This project has been designed with that buyer in mind. It offers the scale of a home, combined with the convenience and security of apartment living, in one of the coast’s most desirable positions.”</p>

<p><img alt="DVB Projects to commence demolition on $320m Broadbeach luxury tower" data-entity-type="file" data-entity-uuid="59aae0ca-5639-4320-8aca-d0bf60f48e43" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/E01_Exterior%20Hero.jpg?VersionId=DS8Zfy2WtgUEtdfe0TEUuf1W1GfcZq8S" /></p>

<p>Located on a 1,156 sqm site one block from the beachfront, the development will replace an ageing walk-up building and is expected to contribute to the ongoing transformation of the Old Burleigh Road strip into one of the Gold Coast’s most prestigious residential corridors.</p>

<p>With the development moving into the delivery phase, 137 Old Burleigh Road is slated to hit the market later this year.</p>

<p>[smartcode_project_cta:default project_id=145141]</p>


DVB Projects to launch second Broadbeach apartment tower as demolition commences

<p><a data-end="327" data-is-only-node="" data-start="250" href="https://www.apartments.com.au/developers/norus-projects" rel="noopener" target="_new">Norus Developments</a> has lodged plans for a new apartment development in Clayton that would add further momentum to the suburb's emerging Green Street corridor.</p>

<p>Plans have been lodged for the consolidated site at <a href="https://www.apartments.com.au/new-apartments/1359-1365-centre-road-clayton-vic-3168">1359-1365 Centre Road</a>, where Norus is seeking approval for 218 apartments across a 12-storey apartment building designed by <a href="https://www.apartments.com.au/architects/life-architecture-and-urban-design">Life Architecture</a>.</p>

<p>The proposal sits within the Clayton Major Activity Centre at the threshold of the planned Green Street corridor, a landscaped pedestrian connection intended to improve links through the precinct towards Clayton Railway Station.</p>

<p>The development would replace the site's existing collection of low-scale residential and commercial buildings with a single consolidated building, introducing significantly greater housing density to this part of Centre Road.</p>

<p>A retail tenancy is proposed at ground level to activate the Centre Road frontage, accompanied by transparent street interfaces and landscaping intended to create a more pedestrian-focused edge to the development.</p>

<p><img alt="First look: Norus Developments plans landscape-led apartment project for Clayton’s emerging Green Street" data-entity-type="file" data-entity-uuid="0a5a763a-d9e9-4253-af2f-88008de27ebf" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Clayton%20a.png?VersionId=S2WJJbat1XVkZwB9SnYtygirXgWHiklX" /></p>

<p>The building has been designed with stepped massing and upper-level setbacks to manage its transition towards surrounding residential properties. The planning report describes the approach as one that integrates the building into the landscape rather than treating landscaping as a secondary element.</p>

<p>"A strong landscape and public realm strategy underpins the proposal," Urbis states in the planning report.</p>

<p>"Public benefits include an affordable housing contribution, a new pocket park, generous landscaped setbacks, deep soil planting and integrated Water Sensitive Urban Design."</p>

<p>The report adds that these elements are intended to create "a permeable, pedestrian-focused ground plane that enhances walkability, supports urban cooling and reinforces the emerging Green Street character."</p>

<p>Biophilic and passive design principles extend through the residential levels, with planting, daylight, natural ventilation and views towards landscaped areas forming part of the amenity strategy.</p>

<p>Parking would be concentrated away from the public realm, with 145 car spaces proposed from the rear laneway rather than dominating the Centre Road frontage.</p>

<p>The proposal follows an extensive pre-application process with the City of Monash. Three formal meetings were held between the project team and Council from December 2025 to March 2026, with the scheme evolving through several concept iterations before the current design was lodged.</p>

<p>The project arrives as Clayton prepares for substantial change around its established activity centre and the wider Suburban Rail Loop precinct. Its position on Centre Road places the development within an existing concentration of shops, services and public transport, while the Green Street connection is intended to strengthen pedestrian access towards Clayton Railway Station.</p>


First look: Norus plans landscape-led apartment project for Clayton’s emerging Green Street

<p><a href="https://www.apartments.com.au/developers/gardner-vaughan-group">Gardner Vaughan Group</a> has officially commenced construction on Bronze on Chevron, celebrating the sod turning of its first-ever Gold Coast development and marking a significant milestone in the company's continued expansion across South East Queensland.&nbsp;</p>

<p>Following the successful delivery of premium residential developments throughout Brisbane and the Sunshine Coast, <a href="https://www.apartments.com.au/new-apartments/bronze-on-chevron-8-mawarra-street-chevron-island-qld-4217">Bronze on Chevron</a> represents Gardner Vaughan Group's entry into the Gold Coast market. Bronze will deliver 119 one, two, three and four-bedroom apartments above two ground-level retail tenancies.</p>

<p>[smartcode_project:default project_id=107520 project_image_fid=367193]</p>

<p>The recent sod turning ceremony was attended by Deputy Mayor Mark Hammel, President of the Surfers Paradise Surf Life Saving Club, Cassandra Sedgman, project consultants, purchasers, project partners and invited guests to celebrate the commencement of construction.&nbsp;</p>

<p>Gardner Vaughan Group Chief Executive Officer Simon Betteridge said Bronze on Chevron represented an exciting new chapter for the business.&nbsp;</p>

<p>"We've spent almost four decades building homes that respond to the way people want to live, and we're excited to bring that experience to <a href="https://www.apartments.com.au/developments/chevron-island-qld-4217">Chevron Island</a>," Betteridge said.</p>

<p>"Bronze on Chevron is particularly significant because it marks Gardner Vaughan Group's first development on the Gold Coast following many successful projects across Brisbane and the Sunshine Coast."</p>

<p>[smartcode_project:default project_id=107520 project_image_fid=367183]</p>

<p>Betteridge said the ground breaking is a proud moment for the&nbsp;team and their purchasers, who can now see their future homes beginning to take shape.&nbsp;</p>

<p>"As both developer and builder, we're able to oversee every aspect of the project from design through to construction, ensuring the quality and attention to detail Gardner Vaughan Group has become renowned for."&nbsp;</p>

<p>Designed by acclaimed architectural practice <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, Bronze on Chevron has been thoughtfully designed to complement Chevron Island's evolving streetscape while embracing its relaxed coastal lifestyle.</p>

<p>The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029.&nbsp;</p>

<p>[smartcode_project_cta:default project_id=107520]</p>


The development will offer generous residences with refined interiors, premium finishes and resort-style amenities, with completion anticipated in early 2029

Gardner Vaughan Group breaks ground on first Gold Coast development, Bronze on Chevron

Construction

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<p><span>GUEST OBSERVER</span></p>
<p><span>On a state basis, NSW is the standout, with private non-residential building work done rising since late 2012. </span></p>
<p><span>Work done in the retail, office, aged care and entertainment have driven the increase. More recently the construction of new office space has slowed. </span></p>
<p><span>After trending higher since 2011, non-residential building work has declined in Victoria over 2016. The recent decline has been largest in health and warehouses, although this follows strong growth previously. There has been a solid lift in work done in the retail sectors over 2016. Non-residential building work has also risen at a solid pace in Queensland. There has been a particularly large lift in construction in the tourism, education, health and aged-care sectors.</span></p>
<p><a href="https://www.propertyobserver.com.au/images/2017/02/17/Screen%20Shot%202017-02-17%20at%208.41.55%20AM.png" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="https://www.urban.com.au/images/2017/02/17/Screen%20Shot%202017-02-17%20at%208.41.55%20AM.png" alt=""></span></p>
<p>Non-residential construction remains soft in both WA and SA. In WA, office building has more than halved as the effects of the mining downturn are still playing out. Despite the decline, office space remains oversupplied in Perth with vacancy rates increasing sharply since 2012.</p>
<p>In SA, construction in the commercial and industrial categories has declined over the past two years. However this is partly offset by a lift in health, tourism and education. </p>
<p>In the public sector, non-residential construction has picked up a little in most States.</p>
<p>What’s in the pipeline?</p>
<p>The approvals data also shows us the value of building work in the pipeline. Private sector non-residential approvals have lifted strongly since September 2016 for all the broad categories. Approvals translate into actual work done with different lags depending on factors such as the size of the project and the industry. However most approvals translate to work done with a lag of between three and twelve months. So the recent lift in approvals means stronger building activity in 2017.  </p>
<p>Within commercial approvals both retail &amp; wholesale and office approvals have lifted strongly in the States of NSW, Victoria and QLD. Approvals for building in the “other” category have also picked up driven by rising approvals in accommodation, entertainment, health and aged care. NSW and Victoria are behind the increase, with approvals down in Queensland and flat in WA and SA </p>
<p>Industrial approvals have lifted too, due to rising approvals in Victoria and QLD. In QLD there has been a lift in approvals for factories, warehouses and agriculture. In Victoria approvals for warehouses and agricultural have picked up.</p>
<p>Public sector non-residential approvals have also lifted in recent years. However approvals have turned down a little in recent months. This is largely due a drop in approvals in NSW and VIC </p>
<p>Going further through the pipeline, the building work yet to be done data shows the estimated value of remaining work on buildings that have been started but not yet completed. The amount of building work yet to be done has been broadly steady over 2016.</p>
<p>The pipeline of commercial building work done has fallen as the amount of office building yet to be done has declined sharply. However there has been an offsetting lift in work yet to be done in the industrial and other category. Within the other category work yet to be done in accommodation and aged care have lifted sharply. And education has risen too. In the industrial category, work yet to be done in factories and agriculture has lifted. </p>
<p><em>Gareth Aird is economist at Commonwealth Bank and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/gareth-aird/14/790/905" target="_blank">here</a>.</em></p>
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jchancellor-FAypfDUnLy

Private non-residential building work a standout in NSW: Gareth Aird

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<p>GUEST OBSERVER</p>
<p>Construction work is trending lower from historic highs, led lower by the mining investment downturn.</p>
<p>With the construction sector accounting for around 14 percent of the economy this is a material headwind.</p>
<p>Total construction work fell by 4.9 percent in Q3, exceeding expectations (Westpac f/c -1.5 percent and market median -1.6 percent).</p>
<p>Over the past year, construction activity is down by 11.1 percent.</p>
<p>The September quarter outcome will subtract in excess of 0.5ppts from quarterly GDP.</p>
<p>This outcome adds to evidence that the economy hit a soft spot in the middle of 2016, as suggested by soggy labour market conditions.</p>
<p>We expect the economy to emerge from this weakness, with conditions to improve in 2017, supported by recent RBA rate cuts and a spike in commodity prices.</p>
<p>Downside surprises were in housing and public works, both of which are likely to improve in coming quarters given the recent strength of approvals and commencements.</p>
<p>Housing approvals rebounded to hit record highs in 2016, supported by lower rates, and state governments are committing to additional infrastructure projects – particularly for transport.</p>
<p>The private non-residential building cycle has turned down, reflecting earlier weakness in approvals. The drop in activity in the quarter was sharper than anticipated, -12.9 percent vs f/c -1.4 percent.</p>
<p>More recently, non-residential building approvals have begun to lift from their lows, pointing to an emerging stabilisation and potential improvement in 2017.</p>
<p>The decline in private infrastructure was largely as anticipated, -6.6 percent vs f/c -8 percent.</p>
<p>By state, construction work fell across the mainland in Q3 – including falls of 2.1 percent in NSW and 6.9% in Victoria.</p>
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<p>Total construction                –4.9 percent<br><span>Private construction            –6.0 percent<br></span><span>Public construction             –0.2 percent<br></span><span> </span></p>
<p><em>Private - by segment</em></p>
<p>Infrastructure                        –6.6 percent<br><span>Dwelling, new                      –3.2 percent<br></span><span>Dwelling renovations          –0.7 percent<br></span><span>Non-res. building                 –12.9 percent<br></span><span> </span></p>
<p><em>Public - by segment</em></p>
<p>Infrastructure                        +1.4 percent<br><span>Building                                 –5.5 percent</span></p>
<p><em>Andrew Hanlan is senior economist for Westpac and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/andrew-hanlan/3/222/430" target="_blank">here</a>. </em></p>
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Total construction work fell by 4.9 percent in Q3: Westpac's Andrew Hanlan

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<p><span>The Australian Bureau of Statistics has released the annual State Accounts. These provide annual estimates of output growth by state, Gross State Product. Quarterly estimates are not available. </span></p>
<p><span>The accounts for the 2015/16 financial year (July to June) confirm that the growth transition is continuing. The mining states of the north-west, Qld and WA, have slowed as construction work on major projects is progressively completed. The southern states have generally improved, benefitting from lower interest rates and a lower dollar.</span></p>
<p><a href="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.42.51%20AM.png" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.42.51%20AM.png" alt=""></span></p>
<p> </p>
<p><span>The two most populous states, NSW and Victoria, topped the growth table in 2015/16, with both expanding at an above trend pace. NSW grew by 3.5%, strengthening from 2.6%, a result closely matched by Victoria, 3.3%, up from 2.6%. </span></p>
<p><a href="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.43.49%20AM.png" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.43.49%20AM.png" alt=""></span></p>
<p><span>In South Australia, output growth of 1.9% is a little below trend, while in Tasmania growth was a modest 1.3%. </span></p>
<p>Western Australia slowed further, moderating to 1.9%, down from 3.6% and well below the 5.8% result of two years earlier. Queensland managed a partial rebound, expanding by 2.0%, up from 1.2% in 2014/15 but still down on the 3.3% outcome for 2013/14. </p>
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<p><span>NSW </span></p>
<p><span>The NSW economy grew by 3.5% in 2015/16, up from 2.6%, the strongest result in 16 years, since 1999/00 - just prior to the Sydney Olympics. The outcome was well above the state's long-run average of 2.5% and exceeded the state government's forecast of 2.75%.</span></p>
<p><a href="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.45.10%20AM.png" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.45.10%20AM.png" alt=""></span></p>
<p> </p>
<p><span>Construction, real estate and financing together added 1.5ppts to growth in 2015/16, up from 0.9ppts the year prior. Positive spill-over effects contributed to stronger performances across a number of industries, including: public services (with state government revenue boosted by the housing boom); transport; wholesale; manufacturing; and communications. Service exports, benefitting from the sharply lower dollar, were also a growth engine, increasing by 12.5% in 2015/16 and adding 0.6ppts </span>to growth, the strongest result since 1992/93 (excluding the Olympics year of 2000/01).</p>
<p><span>Victoria </span></p>
<p><span>The Victorian economy expanding by 3.3%, up from 2.6%, the fastest pace since 2007/08, before the GFC. That is above trend of 2.8% and exceeded the state government forecast of 3.0%.</span></p>
<p><a href="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.46.13%20AM.png" target="_blank"><span>Click to enlarge</span></a></p>
<p><span><img src="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.46.13%20AM.png" alt=""></span></p>
<p> </p>
<p><span>Construction, real estate and finance together added 1.5ppts to growth in the year, up from 0.9ppts. A strengthening of conditions was evident across: retail; communications; transport; wholesale; and public services. Agriculture and manufacturing were areas of softness, both subtracting 0.2ppts. Service exports, having surged 15.4% in 2014/15, advanced by 4.0%. </span></p>
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<p><span>Western Australia </span></p>
<p><span>In the West, conditions continue to moderate. Output grew by 1.9% in the past year, slowing from 3.6%. That is below trend, 4.3%, but above the state government forecast of 1.0%. </span></p>
<p><span>Construction subtracted 0.4ppts from growth, following a<br> drag of 0.3ppts the year prior, as work on major gas projects<br> is progressively completed. Negative spill-over effects contributed to contractions across a number of industries: transport; wholesale; professional services; admin services; and manufacturing. Mining added 1.9ppts to growth, although that was down from 2.5ppts the year prior and 2.9ppts in 2013/14. </span></p>
<p><span>Queensland </span></p>
<p><span>The Qld economy managed a partial rebound in 2015/16, with output growth recovering to 2.0%, up from 1.0% in 2014/15. The result was still below par, of 4.1%, and fell short of the state government forecast of 3.5%. </span></p>
<p><span>Construction fell at a slower rate with much of the work on gas projects already completed, subtracting 0.4ppts from growth after a chunky 1.7ppts drag in 2014/15. Manufacturing and professional services were areas of weakness, both subtracting 0.2ppts, in part due to negative spill-over effects from the mining downturn. Mining output added 0.6ppts to growth, up from 0.5ppts the previous year, as gas exports expand. Real estate was a bright spot, strengthening to add 0.3ppts to growth as </span>the housing sector responded to lower rates. Public services experienced a strong year, adding 0.4ppts to growth, as the state increased public servant numbers. </p>
<p><a href="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.47.30%20AM.png" target="_blank">Click to enlarge</a></p>
<p><img src="/images/2016/11/23/Screen%20Shot%202016-11-23%20at%208.47.30%20AM.png" alt=""></p>
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<p><span>South Australia </span></p>
<p><span>The South Australian notched up back-to-back years of moderate growth, expanding by 2.0% in 2014/15 and 1.9% in 2015/16. That is a little below the long-run average of 2.3% but above the state government forecast of 1.5%. </span></p>
<p><span>Construction, finance and real estate together made a solid contribution of 0.6ppts, up from 0.4ppts the year prior.<br></span></p>
<p><span>Mining bounced back, adding 0.2ppts, after a neutral impact in 2014/15. The rate of decline in manufacturing slowed, subtracting 0.1ppts, well below the peak drag of 0.6ptps in 2013/14. Household services added 0.4ppts to growth, broadly matching the 0.5ppts contribution in 2014/15, following a flat 2013/14. Public services had a strong year, added 0.4ppts. </span></p>
<p><span>Tasmania </span></p>
<p><span>Tasmanian output grew for a third year, expanding by 1.3%, after results of 1.2% and 1.5%. While this is still below average, of 2.0%, conditions have improved from the four challenging years 2009/10 to 2012/13 when output contracted by 0.4ppts. </span></p>
<p><span>International exports, after a period of structural adjustment and benefitting from a lower dollar, surged 20%, adding 2.8ppts to growth. Areas of weakness were agriculture and utilities, both subtracting 0.4ppts from growth. There were record low inflows into the hydo system and the unprecedented prolonged outage of the Basslink interconnector with mainland Australia. The 'balancing item', including inter-state trade, subtracted 4.0ppts from growth. </span> </p>
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<p><em>Andrew Hanlan is senior economist for Westpac and can be contacted <a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/andrew-hanlan/3/222/430" target="_blank">here</a>. </em></p>
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Lower interest rates boost southern states: Westpac's Andrew Hanlan

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<p>The National Association of Women in Construction (NAWIC) has awarded PhD student Natalie Galea two lucrative scholarships in recognition of her research on gender diversity in the construction sector.</p>
<p>Galea was awarded the 2016 NAWIC International Women’s Day Scholarship, worth $23,000, for research into gender diversity and equity in the construction industry. </p>
<p>She was also awarded the 2016 NAWIC NSW CBRE University Scholarship, worth $3000, which recognises outstanding female students who have the potential to significantly contribute to the future of the construction industry.</p>
<p>Galea, from <a href="https://www.be.unsw.edu.au/" target="_blank">UNSW Built Environment</a>, is researching an industry she is intimately acquainted with. For close to two decades she worked in Australia, the Middle East and North Africa as a construction project manager after completing a <a href="https://www.be.unsw.edu.au/postgraduate-degrees/construction-project-management/about-master-construction-project-management?gclid=CjwKEAjwmMS-BRCm5dn51JLbp1wSJACc61tFzyT2iqH6VmoYEB8iWLXRdnL09xoxRnUzvPrKJ1KxAhoC8Inw_wcB" target="_blank">Building Construction Management </a>degree at UNSW.</p>
<p>Female participation in professional construction roles is only 14 percent, and women leave those positions at a 40 percent higher rate than their male counterparts.</p>
<p>“My PhD aims to understand why females struggle to be appointed, promoted and retained in the Australian construction sector.”</p>
<p>"Female participation in professional construction roles is only 14 percent, and women leave those positions at a 40 percent higher rate than their male counterparts."</p>
<p>Its current status is as ‘the most male dominated sector’ in Australia,” she said.</p>
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jonathanchancellor-7SQnKwU6yx

Gender diversity in the construction sector being studied

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<p>Australian contractor Brookfield Multiplex is dropping Brookfield from its name and rebranding to Multiplex while still remaining a Brookfield company. </p>
<p>Multiplex is owned by Brookfield Business Partners, the flagship listed entity of Canadian private equity firm Brookfield Asset Management.</p>
<p>The construction company was bought by Brookfield Asset Management for more than $4 billion in 2007.</p>
<p>John Flecker, chief executive officer of Multiplex Australasia, said, “This is a time for us to rebrand and to ensure our own unique construction identity both within the Brookfield group and with our external stakeholders as a global construction business.” </p>
<p>“Aside from our name and logo changing, it’s business as usual. There are no operational or organisational changes being made.” </p>
<p>Multiplex was established in 1962, and its projects are worth US$66.2 billion, according to a press release.</p>
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Brookfield Multiplex rebrands to Multiplex, no change in ownership

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<p>The next wave of projects readying for construction will see well in excess of $1 billion worth of additional development across Melbourne. Supplementing recently awarded projects and open construction tenders, a handful of major projects are also seeking permits to begin the construction process.</p>

<p>The most recent site to receive builders signage is CBD Development Group's 288 Albert Street, with LU Simon snaring Brunswick's tallest current development. At 14 levels, 288 Albert Street joins the likes of Reflections and The Burgin Residence (ABD Group), Dux Richmond Hill (Hacer Group) and Meridian (Platinum Constructions) as projects which have builders in place, but have yet to start works onsite.</p>

<p>Combined the above five projects alone will add near enough to 750 new apartments to Melbourne's inner suburbs.</p>

<p>Whilst the above projects are poised to begin construction, a wave of additional projects are at construction tender. Among them are two aged care projects that continue Melbourne's verticalisation of retirement living.</p>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/image28_3.jpg" rel="gallery-all" title="Design firm smith+tracey's St Kilda Road development will become reality"><img alt="" class="image-article-full-width-580px" height="407" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/image28_3.jpg?itok=f0986tyy" title="Design firm smith+tracey's St Kilda Road development will become reality" width="580"></a>

<figcaption>Architecture firm smith+tracey's St Kilda Road design will become reality</figcaption></figure><p>Jewish Care Victoria and TLC Aged Care are both pursuing their respective projects on St Kilda Road and Queens Parade, Clifton Hill. With both freshly listed as new construction tenders, the end result will be hundreds of new aged care and community care beds, along with various facilities and services supplementing either development.</p>

<p>With its call to construction <a href="/news/construction-beckons-for-queens-place">recently outlined on Urban.com.au</a>, Queens Place Tower 1 headlines the prospective residential builds at tender. At the lower end of the size spectrum a swag of residential projects are also looking to lock away a builder. </p>

<p>Rosslyn Apartments, Harvard Apartments, Piccolo Developments' 228-230 Dorcas Street, Rockley Gardens, 7-15 Little Oxford Street and the John Wardle Architects-designed 424 Malvern Road are all at tender.</p>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/ext1.jpg" rel="gallery-all" title="Rosslyn Apartments. Image: The Buchan Group"><img alt="" class="image-article-full-width-580px" height="325" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/ext1.jpg?itok=jCpz-FKb" title="Rosslyn Apartments. Image: The Buchan Group" width="580"></a>

<figcaption>Rosslyn Apartments. Image: The Buchan Group</figcaption></figure><p>In the student living stakes two noteworthy projects are at tender.</p>

<p>IGLU's 229 Franklin Street is a roughly 30 level tower that will mark the provider's entry into the Melbourne market, whilst Flemington Road is in for another shot of student living development. This is likely in the form of 5-17 Flemington Road, although a number of other student apartment projects are also active in the area.</p>

<p>From a commercial perspective three projects are preparing their tilt at construction, headlined by 161 Collins Street's T&amp;G Building refurbishment which is at tender. Owner Pembroke Real Estate's plans for the historic building involve a Bates Smart-driven overhaul of the famed Melbourne landmark.</p>

<p>Direct off Apartments.com.au's Forum is news that two of the CBD's larger commercial proposals have taken steps toward construction. 405 Bourke Street is subject to a Construction Management Plan submission which is with City of Melbourne and reportedly calls for a 10 month demolition and excavation programme, followed by 27 months of construction.</p>

<p>A Demolition Management Plan is also up for 477 Collins Street, with the Mirvac-backed development inching toward construction. Demolition is slated through to mid 2017, with construction complete in time for accounting firm Deloitte as the initial tenant to take up space by June 2020.</p>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/side-elevation.jpg" rel="gallery-all" title="405 Bourke Street as per the development's website"><img alt="" class="image-article-full-width-580px" height="813" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/side-elevation.jpg?itok=UdkioSBY" title="405 Bourke Street as per the development's website" width="580"></a>

<figcaption>405 Bourke Street as per the development's website</figcaption></figure>
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silvermb

Billions in development headed toward construction

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<p>It's unprecedented times for Brunswick and surrounding suburbs Brunswick East and Brunswick West. Never before have the trio of postcodes been so popular with Melbourne's apartment builders with 13 separate projects currently under construction.</p>

<p>The yield of apartments from these projects is set to exceed 1,300 dwellings. Brunswick East leads the way with seven projects under construction, followed by Brunswick with four and Brunswick West with two.</p>

<p>Sourcing Apartments.com.au's Project Database, the area is traditionally dominated by medium-sized apartment projects averaging 40-50 dwellings, although the current count of 1,300 apartments under construction is skewed by two large projects which jointly account for approximately 700 apartments under construction.</p>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/image40_4.jpg" rel="gallery-all" title="Ettaro and York Brunswick West are underpinning the area's construction progress"><img alt="" class="image-article-full-width-580px" height="221" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/image40_4.jpg?itok=te8wrDOg" title="Ettaro and York Brunswick West are underpinning the area's construction progress" width="580"></a>

<figcaption>Ettaro and York Brunswick West are underpinning the area's construction progress</figcaption></figure><p>The largest with 400 plus apartments is Brunswick East's Hayball-designed Ettaro which is rapidly approaching completion at the hands of LU Simon, whilst York Brunswick West has seen works begin on the second phase of the project for developer R.Corporation.</p>

<p>Most recent to begin construction have been The Moreland and Protec Property Group's The Dux located adjacent to Anstey Station. A long time favourite of Apartments.com.au, Anstey Precinct as it has been christened is a pocket of Brunswick dedicated toward urban renewal/higher density living.</p>

<p>Joining The Dux under construction within Anstey Precinct are Hendrix Apartments and 8 Bresse Street, with the much publicised Nightingale Apartments on Florence Street set to begin its build. Post its visit to VCAT and subsequent minor design alterations, Nightingale is now poised to become the latest project within Anstey Precinct to offer "delivery of tangible, meaningful, visitable and assessable built outcomes," following in the footsteps of <a href="/news/is-this-melbournes-best-new-residential-development">The Commons</a>.</p>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/img_4890.jpg" rel="gallery-all" title="Bensons Property Group's C3 Brunswick"><img alt="" class="image-article-full-width-580px" height="380" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/img_4890.jpg?itok=kYDuEGLs" title="Bensons Property Group's C3 Brunswick" width="580"></a>

<figcaption>Bensons Property Group's C3 Brunswick</figcaption></figure><p>Further to the 13 projects under construction, Apartments.com.au has identified a further 10 apartment projects set for an imminent construction start. </p>

<p>Among them is Alpha 14 Property Group's Crest on Sydney Road, the aforementioned Nightingale Brunswick and what shapes as Moreland's tallest project to date, Brunswick Heart. Set over 14 levels, site preparation for the RotheLowman-designed project is complete with a builder set to take site possession shortly.</p>

<p>These 10 projects combined will add another 800 plus dwellings to Moreland's ballooning apartment market.</p>

<figure><a class="colorbox colorbox-insert-image" href="https://res.cloudinary.com/dz9xllyip/image/fetch/q_auto:good/https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/img_4929.jpg" rel="gallery-all" title="MakShaq's 8 Lygon is moving toward construction"><img alt="" class="image-article-full-width-580px" height="386" src="/sites/urban.melbourne/files/styles/article_full_width_580px/public/pictures/article-images/img_4929.jpg?itok=RF9uPV-H" title="MakShaq's 8 Lygon is moving toward construction" width="580"></a>

<figcaption>MakShaq's 8 Lygon is moving toward construction</figcaption></figure><p>Whilst construction and projects at sales remain robust within Brunswick and its adjoining suburbs, there are signs that the surge in apartments may be slowing.</p>

<p>2016 has brought a discernible slow down in the number of larger apartment projects filtering through Moreland City Council's online planning platform. Indeed scant few new listing within Moreland have been added to the Apartments.com.au Project Database in recent times as developers seem content in delivering on the healthy backlog of approved projects.</p>

<p>With the persistent talk of market oversupply, the easing of projects at planning could also be a sign that developers have cooled on the Brunswick market somewhat given it has traditionally been the domain of smaller sized apartments aimed toward investors and singles/couples.</p>
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Unprecedented times for Brunswick's apartment growth, but can it last?

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<div class="page" title="Page 1">GUEST OBSERVER</div>
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<div class="page" title="Page 1">New business spending on buildings and equipment fell by 5.2 percent in the March quarter after an upwardly-revised 1.8 percent lift in the December quarter.</div>
<div class="page" title="Page 1"> </div>
<div class="page" title="Page 1">Spending on buildings fell by 7.9 per cent in the quarter while spending on equipment fell by 0.6 percent. Investment is down 15.4 percent over the year.</div>
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<br>Best lift in spending plans in nine years:<strong> </strong>The sixth estimate for investment in 2015/16 is $126.82 billion, up 2.9 percent on the fifth estimate (December quarter) and the biggest upward revision in almost a decade.</div>
<div class="page" title="Page 1"> </div>
<div class="page" title="Page 1">Expected business investment in 2016/17: The second estimate of investment in 2016/17 is $89.2 billion, up 6.3 per cent on the first estimate and the second best lift for an equivalent period in eight years.</div>
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<br>Sectors:</div>
<div class="page" title="Page 1">Mining investment fell by 12.0 percent in the March quarter (seventh straight decline), while manufacturing spending fell by 10.3 pe cent but spending by “other selected industries” rose by 1.8 percent.</div>
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<div class="page" title="Page 1"> The investment data is important for companies in mining services, construction, transport and other industrial sectors.</div>
<div class="page" title="Page 1"> </div>
<div class="page" title="Page 1"> What does it all mean?<br><p>The unwinding of the mining construction boom is proceeding to plan. New investment in the mining sector is continuing to ease as the sector moves from the construction phase to production. Essentially new production capacity had to be put in place.</p>
<p>That has happened, and now businesses are going about the job of shipping higher volumes of iron ore, coal, gold and gas to other parts of the world.</p>
<p>Investment outside mining and manufacturing continues to lift although it is by no means going gangbusters. Over the past six months, investment outside of mining and manufacturing has lifted by over seven per cent. As the Reserve Bank Governor noted this week, what is required in Australia is more innovation and risk taking.</p>
<p>The encouraging aspect of the latest investment report is the upgrade to spending plans. Investment plans for the current year were revised up when they are usually revised down at this time of the year.</p>
<p>And the near 3 per cent  upgrade in the quarter was the best in almost a decade. At  the same time the coming year’s investments plans were lifted by more than 6 percent.</p>
<p>You would expect that the budget measures for small and medium-sized businesses will further lift investment plans in the coming year.</p>
Investment in Queensland continues to slump, hitting 6- year lows. By contrast NSW investment is at 4-year highs.</div>
<div class="page" title="Page 1"> </div>
<div class="page" title="Page 1">The unwinding of investment in Queensland is progressing faster than that in Western Australia, which is a surprise. Despite easing over recent years, Western Australia still remains the investment powerhouse in Australia with investment spending more than 50 per cent higher than second-placed NSW.</div>
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<p><span>What do the figures show? </span></p>
Private business investment</div>
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<br>Overall: New business spending on buildings and equipment fell by 5.2 percent in the March quarter after an upwardly-revised 1.8 percent lift in the December quarter.</div>
<div class="column"> </div>
<div class="column">Spending on buildings fell by 7.9 percent in the quarter while spending on equipment fell by 0.6 per cent. Investment is down 15.4 percent over the year with buildings down by 18.8 percent while equipment is down by 9.2 percent.</div>
<div class="column">
<br>Sectors:</div>
<div class="column">Mining investment fell by 12.0 per cent in the March quarter (seventh straight decline), while manufacturing spending fell by 10.3 per cent but spending by “other selected industries” rose by 1.8 per cent after a 5.3 per cent increase in the December quarter.</div>
<div class="column">
<br>States:</div>
<div class="column">In seasonally adjusted terms investment rose in just three of the eight states and territories in the March quarter. Investment rose the most in Tasmania (up 16.4 per cent to a near 3-year high), followed by NSW (up 3.4 per cent to 4-year highs). Investment fell most in the Northern Territory (down 17.5 per cent), followed by Queensland (down 13.0 per cent), ACT (down 12.5 per cent), Western Australia (down 7.6 per cent), South Australia (down 2.3 per cent) and Victoria (down 0.2 per cent).</div>
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<br>Prices:</div>
<div class="column">The overall deflator for investment goods fell by 0.4 per cent in the March quarter – the first fall in 31⁄2 years. The cost of buildings and structures fell by 0.4 per cent while the cost of equipment fell by 0.6 per cent. Over the year, the cost of investment goods rose by 1.5 per cent – the smallest gain in a year. The cost of buildings rose by 0.5 per cent while the cost of investment equipment rose by 3.1 per cent.</div>
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<br>Forecasts:</div>
<div class="column">The sixth estimate for investment in 2015/16 is $126.82 billion, up 2.9 per cent on the fifth estimate (December quarter) and the biggest upward revision in nine years.</div>
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<div class="column">The second estimate of investment in 2016/17 is $89.2 billion, up 6.3 per cent on the first estimate and the second best lift for an equivalent period in eight years.</div>
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<div class="column"><a href="/images/2016/05/25/Screen%20Shot%202016-05-26%20at%203.12.05%20PM.png" target="_blank">Click to enlarge</a></div>
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<div class="column">What is the importance of the economic data?</div>
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<p><span></span><span>“Private New Capital Expenditure and Expected Expenditure” </span><span>is released quarterly by the Bureau of Statistics. The figures show both actual and expected spending by businesses on tangible assets such as new buildings, machinery and office equipment. The figures are obtained after sampling 8,000 private business units. </span></p>
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<p><span>What are the implications for interest rates and investors? </span></p>
The Reserve Bank had always expected that the unwinding of the mining construction boom would be an extended process. And it is turning out that way. But investment is lifting outside mining and manufacturing. And businesses are becoming more confident about spending money to boost future prospects for their operations.</div>
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<div class="column">The use of technology and productivity measures are allowing businesses to use equipment a little longer as well as making better use of offices and factories. So one reason that businesses aren’t lifting investment is because they are operating more efficiently. It is all about reducing costs in a low inflation world.</div>
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<div class="column">The Reserve Bank may cut rates again. Indeed we are factoring in a quarter per cent rate cut in August. One reason is because the Reserve Bank hopes that monetary policy still works to boost spending, investment and hiring. But also rate cuts are being considered because Australia is no longer the high inflation country it once was. Rates can fall closer to that in other advanced nations. </div>
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<div class="column"><a href="/images/2016/05/25/Screen%20Shot%202016-05-26%20at%203.13.52%20PM.png" target="_blank">Click to enlarge</a></div>
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<div class="column"><em>Craig James is the chief economist at <a href="https://www.comsec.com.au/default.aspx" target="_blank">CommSec</a>.</em></div>
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Biggest lift in investment plans in almost a decade: CommSec's Craig James 

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<p>GUEST OBSERVER</p>
<p>Construction work is trending lower from historic highs, led lower by the mining investment downturn.</p>
<p>With the sector accounting for 14 percent of the economy this is a material headwind.</p>
<p><span>Total construction work fell by 2.6 percent in Q1, broadly as we expected (Westpac f/c -2.2 percent and market median -1.5 percent).</span></p>
<p>Over the past year, construction activity is down by 6.7 percent.</p>
<p>In dollar terms, work fell by $1.3bn in the quarter, of which $1.2bn was due to a drop in private infrastructure activity. </p>
<p>The detail was also broadly as anticipated.</p>
<p>Private infrastructure work fell sharply, albeit not as rapidly as in Q4, as work on major mining projects nears completions.</p>
<p>Public infrastructure advanced for a 3rd consecutive quarter as work on key transport projects gets underway.</p>
<p>The new home building boom continues, although the rate of growth is moderating.</p>
<p>The private commercial building cycle has turned, consistent with the 20% drop in approvals over the past couple of years.</p>
<p><span>Details</span></p>
<p>Total construction                –2.6 percent<br><span>Private construction            –3.7 percent<br></span><span>Public construction             +2.5 percent</span></p>
<p><em>Private - by segment</em></p>
<p>Infrastructure                        –6.8 percent<br><span>Dwelling, new                      +1.5 percent<br></span><span>Dwelling renovations          +0.9 percent<br></span><span>Non-res. building                 –7.6 percent</span></p>
<p><em>Public - by segment</em></p>
<p>Infrastructure                        +2.2 percent<br><span>Building                                 +3.5 percent</span></p>
<p><span> </span></p>
<p><span><span>Andrew Hanlan is senior economist for Westpac and can be contacted </span><a href="https://www.propertyobserver.com.au/https://au.linkedin.com/pub/andrew-hanlan/3/222/430" target="_blank">here</a><span>. </span></span></p>
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Australian Q1 construction work down 2.6 percent: Westpac's Andrew Hanlan

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<p><img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1"></p>
<p>GUEST OBSERVER</p>
<p><em>Another hot and humid day in Sydney tomorrow with a maximum of 32 degrees in the city and 38 in the western suburbs.</em></p>
<p>How many times have we heard that on TV or radio weather reports?</p>
<p>But what would you think about the following forecast?</p>
<p><em><span style="line-height: 1.3em;">Temperatures in Wattle Street, Ultimo, will spike at 37 degrees around 10 am. Further up the hill at Point Street we can expect a top of 40 degrees shortly after 1 pm. Meanwhile, at the Observatory Hill weather station the 3 pm maximum will struggle to pass 32 degrees.</span></em></p>
<p>We are unlikely ever to be able to forecast temperatures to such pinpoint accuracy. Still, the above exercise reflects the very real differences in temperature – and thermal comfort – at the scale of the individual street, indeed individual block, within our cities.</p>
<p>The driver of this surprising variability is the interaction between urban form and the heat energy of the sun. Building heights and materials, width and orientation of streets, and presence or absence of vegetation all affect local temperatures across the city. And if we drive to work, the heat from our vehicle’s engine and exhaust might be adding a degree or two.</p>
<p>Recent media reports have highlighted the bizarre weather patterns in Sydney over January, February and March 2016. Some reports have linked evidence of temperature extremes to urbanisation and the loss of shading and moisture that vegetation provides. This is known as the Urban Heat Island (UHI) effect.</p>
<p>A research collaboration between the UNSW Faculty of Built Environment and the Universities of South Australia and Melbourne has collected further evidence for the highly localised effects of building form, surface materials and street orientation on outdoor microclimate and pedestrian thermal comfort. The aim is to build a solid evidence base to inform design, planning and policy across Australian cities.</p>
<p>Meteorological data collected during the 2015-16 summer in Sydney reveals that air temperatures in the street “canyon” may vary by up to 5℃ from those the Bureau of Meteorology records at Observatory Hill.</p>
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<img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/119034/width754/image-20160418-23606-mjsnwt.png" alt=""><span class="attribution"><a class="license" href="https://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
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<p>Even more worrying are the surface temperatures measured on building facades. These may exceed 70℃ in the sun.</p>
<p>The vertical surfaces of multi-storey buildings account for much of the urban surface in contact with the surrounding air. Hotter surface temperatures elevate nearby air temperatures during the day.</p>
<p>Then, due to the thermal mass of typically dense and dark building materials, building facades continue to emit radiant heat well after sunset. This slows the cooling of local outdoor air temperature.</p>
<p>Without night-time cooling, human thermal discomfort is prolonged. Consecutive nights of elevated air temperatures have severe impacts on human health. This includes increasing heat-related mortality and morbidity.</p>
<p>More extreme heat days projected from climate change on top of localised heating due to urban design elevates the health risks from future heatwaves.</p>
<h4>
<img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/119033/width754/image-20160418-23629-4gkckn.png" alt=""><span class="attribution"><a class="license" href="https://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
</h4>
<h2>Urban temperatures vary with design</h2>
<p>Our research sought to quantify the effects of typical urban form and materials on street microclimate and outdoor thermal comfort. We recorded building surface temperatures and ambient air temperatures using a thermal camera and mobile weather station in various locations in metropolitan Sydney.</p>
<p>Preliminary results suggest that business-as-usual architectural and urban design are exacerbating urban heat and creating hotter cities. This is alarming when considering the current and projected population of Australia’s major cities, particularly the growing proportion of vulnerable elderly.</p>
<p>On January 14, 2016 – Sydney’s hottest day that month – the 9AM and 3PM air temperatures recorded at Observatory Hill were 30.8℃ and 32.4℃ respectively.</p>
<p>On the same day, pedestrian-height air temperatures were recorded mid-morning in Wattle Street, Ultimo – 32.34℃ at 9am – and mid-afternoon in Point Street, Pyrmont – 36.34℃ around 3pm. These temperatures in Wattle and Point streets were 1.54℃ and 3.94℃ higher – or up to 12.2 percent greater – than the maximums at Observatory Hill.</p>
<p>Prior studies have reported a significant increase in mortality for every 1℃ rise in air temperatures above a mortality-temperature threshold (typically around 32℃ for Australian cities). This applies particularly for the population aged 65 years and older. Conversely, every degree of cooling has health and economic benefits for urban residents.</p>
<p>The surface temperatures of nearby building facades confirm a potential source of localised heating. The seven-storey, northeast-facing Wattle Street facade recorded a maximum spot temperature of 65℃ and a mean surface temperature of 46℃ around 9AM. The eight-storey, northwest-facing Point Street facade recorded an average surface temperature of 42.4℃ and a spot maximum of 54℃ mid-afternoon.</p>
<p>Notwithstanding measurement uncertainty due to emissivity (how well a material emits heat energy), the higher daytime building facade temperatures suggest an influential relationship with observed near-facade air temperatures.</p>
<p>By taking into account the design drivers – including orientation and solar exposure, material albedo (reflectance) and emissivity, and views of opposite buildings and the sky – building designers can help cool our cities through “cool facades”.</p>
<h2>Buildings hold key to outdoor comfort</h2>
<p>We also calculated the effects of material properties on outdoor air temperatures and thermal comfort for January 14.</p>
<p>Footpath albedos (reflectance) in Wattle Street and Point Street ranged from 0.033 to 0.050 for rough weathered bitumen and smoother grey stone pavers respectively. Superficially the footpath materials appear to be the same colour. However, the rougher bitumen has a lower reflectance and therefore absorbs more solar radiation (and becomes hotter) than the smoother stone tile.</p>
<p>Prior studies have linked surface roughness to reflectance characteristics. The potentially contradictory effects of footpath surface reflectance on air temperatures and thermal comfort are evident in the grey globe thermometer (GGT) measurements.</p>
<p>The GGT measures only radiant heating to which humans are particularly sensitive. Cooler air temperatures are often correlated with higher albedo surfaces, but greater reflectance may increase the radiant load on pedestrians, increasing thermal discomfort.</p>
<p>The GGT 10-minute mean between 8.30AM and 10.30AM in Wattle Street was 36.95℃ and the ten-minute mean air temperature for the same period was 33.70℃. Between 1PM and 2.30PM in Point Street, the GGT ten-minute mean was 43.0℃ and the ten-minute mean air temperature was 38.57℃.</p>
<p>The relative differences between ambient and GGT temperatures are 4.87℃ and 6.05℃. This greater GGT temperature difference confirms the additional radiant heating from the more reflective footpath surface and nearby hot facade.</p>
<p>The conclusion? Weather is not simply what the bureau tells us. As higher urban temperatures occur at the scale in which people actually live – the building, the street, the block – the implications for our health and well-being are profound.</p>
<p>By informing those involved in city planning, management and design about the implications of their design decisions on urban microclimate, this research provides the evidence base for a “cool” urban future.</p>
<p><em><span class="fn author-name" style="line-height: 1.3em;">Paul Osmond is s</span><span style="line-height: 1.3em;">enior lecturer, Sustainable Built Environment, UNSW Australia and can be contacted <a href="https://theconversation.com/profiles/paul-osmond-205774" target="_blank">here</a>.</span></em></p>
<p><em><span class="fn author-name" style="line-height: 1.3em;">Jonathan Fox </span><span style="line-height: 1.3em;">PhD Research Candidate, Urban Climates Research, UNSW Australia and can be contacted <a href="https://theconversation.com/profiles/jonathan-fox-250999" target="_blank">here</a>.</span></em></p>
<p><em><span style="line-height: 1.3em;">Both are authors for </span>The<span style="line-height: 1.3em;"> Conversation.</span></em></p>
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