Local developer Harridan is seeking to turn its Woolloongabba apartment project into the first stage of a broader transformation of Burke Street, using a new 16-storey mixed-use building to establish a greener pedestrian connection toward the rapidly evolving Boggo Road transport and knowledge precinct.

The South East Queensland developer has filed plans for 154 apartments on the <a href="https://www.apartments.com.au/new-apartments/4-burke-street-woolloongabba-qld-4102">southern side of Burke Street</a>, where its proposal has been designed alongside a wider vision by LatStudios for the street.

That vision positions the southern side of Burke Street for buildings of 15 storeys and above, while envisaging lower-rise development of up to five storeys on the northern side to transition into Woolloongabba's existing character housing. It also proposes wider pedestrian verges, deep planting, new street trees and upgrades to the pedestrian approach to Boggo Road Station.

The Harridan development itself has been designed by Brisbane-based Arqus Design and will comprise 154 apartments across 16 storeys. The mix is weighted heavily toward two-bedroom apartments, with 121 proposed alongside 10 one-bedroom and 23 three-bedroom residences. There will typically be around 14 units per floor.

A lower-ground car park and three podium levels will accommodate 156 resident parking spaces, along with visitor and commercial parking. There will also be 154 resident bicycle spaces and 40 visitor bicycle parks.

&nbsp;

Harridan is a family-owned developer and part of the Holmwood Highgate Group, with more than three decades of development activity across South East Queensland. Its portfolio spans residential, commercial and industrial property, with current residential projects including Riverbank on Byron in Bulimba, Esperance Residences in Carina and The Precinct at Kinross Road in Thornlands.

Wooloongabba has been popular for apartment developers, particularly since the announcement of the 2032 Summer Olympics games in Brisbane.

While there have been a lot of development applications, it has failed to materialize into real supply.&nbsp;

Sarazin has been the major player in the area. They are under construction at Murcia Residences, on the fringe of East Brisbane and Woolloongabba. They have just launched <a href="https://www.apartments.com.au/new-apartments/the-stanley-residences-woolloongabba-8-trafalgar-street-woolloongabba-qld-4102">The Stanley Residences</a>, in Woolloongabba on Trafalagar Street. They also have Nuage coming soon on the nearby <a href="https://www.apartments.com.au/new-apartments/nuage-woolloongabba-14-wellington-road-woolloongabba-qld-4102">Wellington Road</a>.

Joel Robinson

First look: Harridan plans Burke Street transformation beside Boggo Road transport hub

IN BRIEF

<ul>
	<li>
	Just three double-storey Sky Homes sit at the top of The Waterline, each with its own private marina berth and rooftop terrace.
	</li>
	<li>
	Construction on The Waterline is complete, with the first residents expected to move in from mid-October.
	</li>
	<li>
	Sky Homes range from 282 sqm to 367 sqm and are priced from $3.65 million.
	</li>
</ul>

<hr />
Lewis Land has opened the first completed sky home for inspection at Harbour Shores, giving buyers their first opportunity to step inside one of just three double-storey residences crowning The Waterline.

Each sky home comes with its own private marina berth, rooftop terrace and Broadwater views, combining the scale of a larger home with direct access to the boating lifestyle that underpins the wider <a href="https://www.apartments.com.au/new-apartments/harbour-shores-biggera-waters-564-oxley-drive-biggera-waters-qld-4216">Harbour Shores</a> masterplan.

[smartcode_project:default project_id=113271 project_image_fid=366708]

Lewis Land Head of Development Michael Long said the inclusion of a berth with every Sky Home had become increasingly valuable as marina access across the Gold Coast tightened.

“Marina berths are becoming increasingly difficult to secure across the Gold Coast, so including one with every Sky Home makes this a genuinely rare offering,” Long said.

“The private 70-berth marina will accommodate boats up to 12 metres in length and is positioned just 2.5 kilometres from the Broadwater, placing the open ocean only 15 minutes away.

“Being able to step out of your home onto your boat is a rare luxury, and it’s something residents here can look forward to when it opens later this year.”

[smartcode_project:default project_id=113271 project_image_fid=366709]

The display opening comes as construction completes on The Waterline, with the first residents expected to move in from mid-October.

The three Sky Homes range from 282 sqm to 367 sqm and each feature three bedrooms, three bathrooms, multiple living zones, expansive kitchens with butler's pantries and large balconies taking in the Broadwater outlook.

Each residence also has three secure basement car spaces and additional storage.

“This is the first opportunity the Gold Coast has had to step into Harbour Shores and see, touch and feel what we’re bringing to life here,” Long said.

“There are only three Sky Homes within The Waterline, ranging in size from 282sqm to 367sqm, with each residence featuring three large bedrooms, three bathrooms, multiple living zones, expansive custom-built kitchens with butler’s pantry, and large balconies capturing Broadwater views.”

<img alt="Harbour Shores" data-entity-type="file" data-entity-uuid="bab65e10-4fab-45e1-92d8-fc56e2ab98ff" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-25%20at%202.00.16%E2%80%AFPM.png?VersionId=XT8q76LsPkw3cYTsvN3JfFDaPLud90PN" />

Residents of The Waterline will have access to a private pool, along with Harbour Shores' wider collection of amenity including a lagoon pool, social clubhouse, tennis court, gym, yoga facilities and sauna.

Lewis Land partnered with Studio Collective to furnish the completed display, with the interiors designed to demonstrate how the residences could function as permanent homes rather than simply as show apartments.

Studio Collective Director Melissa Park said the surrounding waterways informed the interiors, but in a more restrained way than a traditional coastal scheme.

“We drew inspiration from the canals and coastal surrounds, but our approach was to interpret that subtly through layered materials and a grounded palette of earthy tones, rather than literal coastal references,” Park said.

“We introduced hero moments of green and teal to reference the surrounding waterways, while mirrored elements help reflect natural light.

“The result is a residence that feels elevated yet comfortable, somewhere buyers can genuinely imagine themselves living, entertaining and unwinding.”

Sky Homes are priced from $3.65 million.

Lewis Land is also offering private marina berths with The Residences, its limited collection of three and four-bedroom villas positioned directly along the Harbour Shores waterfront boardwalk.

Three-bedroom villas are priced from $2.99 million, while four-bedroom residences start from $3.19 million.

Harbour Shores is being marketed by Colliers International.

[smartcode_project_cta:default project_id=113271]

Lewis Land opens sky home display as The Waterline completes at Harbour Shores

St Vincent de Paul Society Housing Australia has filed plans for a major mixed-use housing precinct on the southern edge of the North Sydney CBD, adding another significant proposal to a pocket around North Sydn​ey Station that is quickly becoming one of the LGA's busiest development zones.

The State Significant Development Application covers a 5,990 sqm site at <a href="https://www.apartments.com.au/new-apartments/1-19-mackenzie-street-lavender-bay-nsw-2060">1-19 MacKenzie Street and 211 Blues Point Road in Lavender Bay</a>, immediately south of Nor​th Sydney Station and between the commercial core and the lower-rise Lavender Bay Heritage Conservation Area.

Designed by Wardle, the proposal would deliver a new residential tower comprising 88 build-to-sell apartments and 19 affordable apartments, alongside a separate co-living building with 57 rooms and a building manager's studio.

It would also see the significant restoration and upgrade of St Francis Xavier Catholic Church, the adaptive reuse of the former school building, new parish facilities, retail, a new public square and around 1,000 sqm of publicly accessible open space.

<img alt="Vinnies North Sydney" data-entity-type="file" data-entity-uuid="d5dd7f87-a617-463e-b577-17541e01f0e9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.13%E2%80%AFAM.png?VersionId=4R8TsFN3P_LrrXO2HswTOIrx2blil8lh" />

The project is seeking a concurrent rezoning of the site to R4 High Density Residential and an increase in the maximum building height to allow a tower reaching RL120, or up to 20 storeys. The proposal was progressed through the NSW Government's Housing Delivery Authority pathway.

The build-to-sell component will be weighted toward larger apartments, with just six one-bedroom apartments compared with 31 two-beds, 43 three-beds and eight four-bedroom residences.

The 19 affordable apartments will comprise two studios, 15 one-bedroom apartments and two two-bedroom apartments, taking the total apartment component to 107 residences before the 58 co-living rooms are included.

<img alt="Vnnies" data-entity-type="file" data-entity-uuid="7d568ca5-cb90-4e18-96c6-d9795dba0c56" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.10.05%E2%80%AFAM.png?VersionId=GY2R5M9VtQh0EKy1vajaea19PSLOPuRD" />

Wardle's design for the Vinnies site has sought to negotiate that emerging high-rise context while retaining the lower-scale character of MacKenzie Street and the adjoining heritage conservation area.

The main building adopts a three-storey podium and tower arrangement, with the podium aligned to the ridgeline and front setback of St Francis Xavier Church.&nbsp;Wardle has designed the podium with colonnades, seating, recessed entries and active ground-floor frontages, with sandstone-toned precast concrete and face brick referencing the materiality of the existing church.

The tower then steps back eight metres to the south and six metres to the north before rising in a sculpted form comprising four interlocking quadrants. Wardle has also introduced rounded forms and chamfered corners to reduce the tower's perceived bulk and improve view sharing with neighbouring development sites.

Resident facilities and outdoor areas are planned at the separation between the podium and tower at Level 3, oriented toward Sydney Harbour and the CBD skyline.

The tower itself will feature a glass reinforced concrete facade, with recessed balconies and deep reveals used both to provide shading and privacy and frame views toward the harbour and city. The lower levels take a different architectural approach, using brick and sandstone-toned finishes intended to establish a stronger relationship with St Francis Xavier Church. The Church itself will be conserved and upgraded for its continued use, while the former school building will be adaptively reused as part of the co-living component.

<img alt="Lavendar Bay" data-entity-type="file" data-entity-uuid="2d4418ad-90aa-4d49-af93-c80b140aea80" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%209.09.47%E2%80%AFAM.png?VersionId=Kv4gzbsACaGvZSRuaqcfGC54jEJRXIDJ" />

&nbsp;

The proposal adds to an increasingly concentrated pipeline of residential development around Blue Street, MacKenzie Street and Lavender Bay.

Just west of the site, Central Element lodged plans earlier this year for one of the most significant residential developments proposed in Lavender Bay in recent years.

Central Element's SJB-designed scheme at 64-66 Lavender Street and 3-7 Middlemiss Street would deliver 163 apartments across two towers rising 23 and 32 storeys, replacing five existing apartment buildings containing 32 homes. The project also forms part of the Housing Delivery Authority pathway.

<a href="https://www.apartments.com.au/news/nsw/first-look-central-element-reveals-lavender-bay-apartment-plans?utm_source=chatgpt.com" rel="noopener" target="_blank">First look: Central Element reveals Lavender Bay apartment plans</a>

Immediately around North Sy​dney Station, another two significant proposals have emerged at 5 and 15 Blue Street.

Zurich Australian Insurance Properties is seeking to adaptively reuse its longstanding commercial building at 5 Blue Street, directly above North Sydney Station, rather than demolishing the structure.

Its SSDA proposes converting the building into a 14-storey mixed-use development with 62 apartments and 86 co-living rooms, together with ground-floor retail and a major refurbishment of Blue Street Plaza. The application is currently at the Response to Submissions stage.

<a href="https://www.apartments.com.au/news/nsw/first-look-zurich-targets-north-sydney-office-conversion-with-148-unit-proposal-above-metro-station">First look: Zurich targets North Sydney office conversion with 148-unit proposal above Metro station</a>

&nbsp;

First look: Vinnies files for 20-storey Lavender Bay apartment tower as North Sydney housing pocket heats up

When the opportunity arose for South Australian developer Palumbo to return to Kent Town, where it had previously delivered East Park Apartments and the East 
Rundle Apartments, it wasn't one the longstanding developer-builder was going to pass up.

The decision was quickly vindicated, with more than 30 apartments sold within the first month of launching <a href="https://www.apartments.com.au/new-apartments/royal-apartments-kent-town-2-8-north-terrace-kent-town-sa-5067">Royal Apartments</a> to the market.

The 206-apartment development, which will bring significant new supply to Adelaide's tightly held eastern city fringe, also gives <a href="https://www.apartments.com.au/developers/palumbo">Palumbo</a> the opportunity to bring new life to one of Kent Town's most recognisable watering holes.

[smartcode_project:default project_id=6109 project_image_fid=376073]

Royal Apartments incorporates the historic Royal Hotel, a venue Palumbo Managing Director Daniel Palumbo said has a longstanding connection with the local community.

"Everyone in the area has history with the Royal Hotel," Palumbo told Apartments.com.au.

"It was quite an active pub and social gathering place for locals. We want to bring it back to its former glory."

[smartcode_project:default project_id=6109 project_image_fid=376072]

The wider development will comprise two residential towers alongside the restored hotel, sitting on North Terrace opposite the Adelaide Park Lands.

For Palumbo, the project also marks a return to familiar territory.

The developer completed East Park Apartments next door more than a decade ago and jumped at the opportunity to develop in Kent Town again when the Royal Hotel site became available.

"The opportunity emerged, and we moved to secure the site," Palumbo said.

"We were approached by the previous landowner, who said they had extensive commitments in Sydney and weren't in a position to deliver the project.

"We took over the site and within six months recut the design scheme to be more in keeping with the type of development we want to bring to Adelaide.

"Now we're on the market and those changes have really resonated with local buyers."

That has translated into a strong start to sales, with 33 apartments transacting in the project's first 35 days.

Palumbo said the early purchaser profile had been consistent with the group's traditional focus on owner-occupiers rather than investor-led apartment stock.

"Local owner-occupiers have always been our market," he said.

"There are always some investors, but we've never developed what would be called traditional development stock. Owner-occupiers are very much our market."

[smartcode_project:default project_id=6109 project_image_fid=376068]

The buyer mix has been diverse so far, with downsizers and younger professionals both accounting for a significant portion of early sales.

South Australia's current stamp duty settings, which allow&nbsp;eligible homeowners in South Australia aged 60 savings of up to $103,830 on stamp duty when they downsize to a new property valued at up to $2 million,&nbsp;have helped encourage downsizer activity, while younger buyers in their late 20s and early 30s have been attracted to the opportunity to live immediately outside the CBD while still being able to walk into the city.



Location has been a major part of the proposition for both buyer cohorts.

[smartcode_project:default project_id=6109 project_image_fid=376075]

Royal Apartments sits on North Terrace directly opposite the Adelaide Park Lands, with residents able to walk through the parklands toward the East End, Rundle Street and Rundle Mall.

Apartments have been positioned to capture views across the parklands, Adelaide skyline, Botanic Gardens and Adelaide Hills.

Palumbo believes the scarcity of developable land along this section of the Park Lands makes the site particularly difficult to replicate.

"There's very few allotments on that side that can be developed," he said.

"If this location was in New York and you were sitting on Central Park, you'd be talking about a $60 million apartments."

Royal Apartments will offer a broad mix of residences, ranging from one-bedroom apartments through to four-bedroom sub-penthouses and penthouses.

Current listings include one-bedroom apartments from $680,000, while larger three and four-bedroom residences are priced around $2.5 million.

Residents will have access to a swimming pool, gym, barbecue and recreation areas, residents' lounge and dining space, and a communal deck.

[smartcode_project:default project_id=6109 project_image_fid=376067]

The apartments will feature generous balconies, while secure parking, bicycle storage and storage cages will also be provided.

A porte-cochère-style arrival and drop-off area has also resonated with buyers, particularly those attracted to being able to walk into the CBD during the day while retaining secure vehicle access at home.

Palumbo is acting as developer, architect and builder on Royal Apartments, continuing the vertically integrated model it has used across its South Australian portfolio.

The group was also behind the $150 million Sofitel Adelaide, the 251-room five-star hotel and residential tower which opened in 2021.

Palumbo said Royal's launch had come at an interesting time for the broader Adelaide apartment market.

Buyer confidence had initially been impacted by uncertainty surrounding the Federal Budget and broader economic conditions, but Palumbo believes sentiment is beginning to improve against a backdrop of significant investment flowing into South Australia.

He pointed to increased activity across defence and resources, including Olympic Dam, as potential long-term drivers of the state's economy and housing market.

"Money is starting to flow into Adeliade, significant amounts as Adelaide bucks the trend of the rest of the country.," Palumbo said.

"There's a lot of activity in the economy over the next decade. I think more investment will come into this market."

Early works on Royal Apartments are expected to commence this year, with major construction activity and cranes anticipated on site from early next year.

[smartcode_project_cta:default project_id=6109]

Palumbo's return to Kent Town strikes early chord with buyers

Go-to builder-developer <a href="https://www.apartments.com.au/developers/graya">GRAYA</a> is continuing to bulk out its already impressive and diverse apartment portfolio across South East Queensland. Their latest milestone is securing development approval for Silk, its boutique riverfront apartment development in St Lucia.

The approval clears&nbsp;the way for the team to begin construction planning for the 22-residence project.

<a href="https://www.apartments.com.au/new-apartments/silk-st-lucia-16-18-sandford-street-st-lucia-qld-4067">Silk</a> will rise 15 levels from an 810 sqm site at 16-18 Sandford Street, occupying a prominent bend of the Brisbane River with a prized northern aspect across Orleigh Park toward the Brisbane CBD.

The approved scheme will comprise 16 split-floor and six full-floor residences, continuing GRAYA's move into larger-format apartment developments targeting Brisbane's prestige owner-occupier market.

The project has been designed around the site's broad river frontage and dual-direction views, with GRAYA prioritising larger residences, privacy and outlook over apartment yield.

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="aa5c2349-f96c-4914-a812-1f2cd6827af8" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.44%E2%80%AFAM.png?VersionId=WY0vEU_7vYjeRJKQHiCwFdMxu8PvFh52" />

GRAYA Co-founder and Chief Executive Officer Rob Gray said the project had been shaped around local homeowners wanting to remain in St Lucia without maintaining a traditional family home.

"St Lucia is one of those suburbs people do not want to leave," Gray said.

"They know the river, the trees, UQ, the golf course, Toowong and Indooroopilly, and that familiarity is hard to replace.

"True riverfront opportunities here are exceptionally scarce. What we have designed at Silk is a way to stay in the suburb people love, with the scale and privacy of a private home and far less to maintain.

"This is not typical apartment product. It is a proper home on the river, and that is exactly what this market has been missing."

The approval comes as new apartment development continues to increase across the St Lucia and neighbouring Toowong corridor, although direct riverfront sites remain considerably more tightly held.

GRAYA Co-founder and Managing Director Andrew Gray said securing the approval had removed a significant element of development risk from Silk.

"Genuine riverfront sites of this quality in St Lucia are not something that comes up regularly," Gray said.

"The approval removes a substantial layer of execution risk, and the location underwrites demand in a way very few inner-city sites can.

"The fundamentals here are as strong as anything we have assessed in Brisbane."

<img alt="Silk St Lucia" data-entity-type="file" data-entity-uuid="d0f3d734-65e1-48e8-8ed3-2e0715ffcdd9" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-08-26%20at%208.25.56%E2%80%AFAM.png?VersionId=sOLSs_jdHkXLWbBKzRyayf5BfTb2vPsD" />

Silk will see GRAYA return to a stretch of the Brisbane River where it already has recent construction experience. The vertically integrated group recently completed ARC in neighbouring Toowong as builder for developer Spyre, delivering the riverfront project on a constrained site.

GRAYA will take a different role at Silk, controlling the project from design and development through construction and aftercare under its vertically integrated model.

The development will include a gym and resident leisure areas at ground level, integrated with the river's edge.

Silk joins a growing pipeline for GRAYA across Brisbane and the Gold Coast, which includes Enclave, The Gallery, Coral and Ripple.

The developer-builder has also recently lodged plans for its largest project to date, <a href="https://www.apartments.com.au/new-apartments/the-silo-19-chester-street-newstead-qld-4006">The Silo</a>, a proposed <a href="https://www.apartments.com.au/news/qld/graya-buys-frasers-newstead-site-plans-the-silo-between-james-street-and-gasworks-precincts">$700 million mixed-use development</a> in Brisbane's James Street precinct.

Silk is expected to predominantly target local owner-occupiers and prestige buyers seeking a permanent riverfront home in Brisbane's inner west.

Registrations of interest are now open, with further details on the project and construction program to be released as it progresses.

<hr />
<h2>SILK PROJECT FACTS</h2>

Developer-builder: GRAYA

Project: Silk

Location: 16-18 Sandford Street, St Lucia

Apartments: 22

Built form: 15 levels

Site: 810 sqm riverfront holding

Mix: 16 split-floor and six full-floor residences

Status: Development approved

Next step: Construction planning underway

[smartcode_project_cta:default project_id=152168]

GRAYA greenlit for riverfront St Lucia apartment development, Silk

Infrastructure

<html><body>
Australian cities figure regularly and highly on the liveability index with three in the top 10 led by Melbourne.
The trend will likely continue if Australian cities, especially Sydney and Melbourne with their rapid population growth, develop transport infrastructure that leads people growth and not react to it, according to Savills.
Many academic studies had pointed to the preference among skilled workers for 'liveability' over financial rewards including a recent (2016) Savills UK study - What Workers Want – which found workers wanted their life contained within a half hour radius.
Savills Australian head of research Tony Crabb said, he expects skilled or knowledge workers to be doubly attracted to places where they can achieve both a high degree of liveability and financial rewards, but transport infrastructure is the critical element with work, rest and play accessible in 30 minutes by car, public transport, walking, or cycling, the key determinant.
"While Melbourne and Sydney were likely to attract a growing number of skilled workers with population forecasts of up to 10 million by 2050, two other cities - Adelaide and Perth – were nominated with Melbourne, by the London based Economist Intelligence Unit (EIU), as among the world's top ten most liveable," he said. EIU List of the world's most liveable cities
<ul>
<li>Melbourne, Australia</li>
<li>Vienna, Austria</li>
<li>Vancouver, Canada</li>
<li>Toronto, Canada</li>
<li>Calgary, Canada</li>
<li>Adelaide, Australia</li>
<li>Perth, Australia</li>
<li>Auckland, New Zealand</li>
<li>Helsinki, Finland</li>
<li>Hamburg, Germany</li>
</ul>
“That is a great achievement for those cities but if they wish to maintain that status, transport infrastructure development needs to be front of mind. It needs to lead population growth rather than react to it but certainly governments need to be proactive. In my experience, in cities of 10 million people, cars don't work very well. Australian cities are very car-centric and need to develop better alternatives.
“Major transport infrastructure provides the backbone of investment opportunities and it is generally around such infrastructure that industries agglomerate, but light rail, tram, bus, cycling and street networks are equally important in delivering liveability. In an age where technology allows us to be virtually mobile at a global level, the quality of local neighbourhoods has rarely mattered more,” Crabb added.
Crabb said Australia's ageing population and the boom in demand for childcare were also significant issues that governments needed to consider in terms of liveability and attracting skilled workers. “Buildings including government offices, law courts, hospitals, schools and universities, and sporting and entertainment facilities provide the basic social infrastructure for growing communities and as such are magnets for population growth, but increasingly childcare and aged care are the 'must haves' for skilled workers and their extended families. “As the population grows and ages, the provision and facilitation of these industries also presents further opportunities in the built environment for hospitals, respite care, aged care, retirement living, medical centres and allied health industries which in turn provide anchors for other real estate,” Crabb said. He said while demand for childcare services would continue to grow with opportunities for investors and developers in both neighbourhood and near-workplace crèches, nursery schools and day care, hospitals may well be viewed as the new 'mega-mall'. “Hospitals are a large piece of public infrastructure and generally do not close down. As demand for hospital services increases, the land around them becomes more valuable for ancillary services. Short-term stay accommodation, entertainment, retail, offices, consulting suites, services and parking are just some of the value-add opportunities on offer to investors,” Crabb said. He said in a globally competitive environment governments needed also to be aware of the need to cater to the requirements of an increasingly mobile skilled immigrant workforce. “Skilled migrants have a choice of countries to which they may be attracted, and so hitherto attractive countries will face competition in the form of financial inducements such as free education and healthcare, low taxes, high wages and interesting jobs as well as lifestyle, safety, security and cleanliness. “Given the diversity of attractive offerings from competitors, liveability for Australian cities needs also to factor in policy and development with a multicultural flavour,” Crabb said.
</body></html>

jonathanchancellor-7SQnKwU6yx

Transport infrastructure critical to successful cities: Savills

<html><body>
<img src="https://counter.theconversation.edu.au/content/68326/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
Large transport infrastructure projects, which can cost billions of dollars, are major drivers of the economy, and political flagships.
They have significant impacts on health and wellbeing. Yet our research finds these impacts are not as well considered in the project assessment phase as they should be.
A recent Lancet series is the culmination of knowledge linking transport and health. For example, it recommends reducing reliance on private cars and enhancing opportunities for walking, cycling and public transport use. It argues this will improve health both by reducing air and noise pollution, and by promoting physical activity, community connectedness and better access to goods and services, particularly for the socio-economically disadvantaged.
Each transport project’s environmental assessment thus presents a crucial opportunity within the mandated planning process to consider health. This is also when the wider community can engage with the design of projects. The main output of this process, the environmental impact statement (EIS), is available for public scrutiny and comment prior to final project approval. 
<h2>A health check on assessments</h2>
We recently compared the inclusion of health issues in four major transport project assessments. Three involved motorways (WestConnex M4 East and NorthConnex in New South Wales and the 2010 Darlington Upgrade in South Australia) and the fourth the Sydney CBD and South East Light Rail. We did this by first applying a “health audit” to each EIS, then interviewing a range of stakeholders. 
The road assessments emphasised risks from air quality and noise, concluding these were minimal. Indeed, each project was predicted to improve air quality and, by extension, health. 
When health was assessed, human health risk assessment was the method used, which we judged to be of good quality. The 2010 Darlington upgrade was the only road project not to include health data explicitly in its calculations. 
The light rail EIS referred mainly to the connection of the project to health facilities, with some reference to noise and dust in construction. This statement’s chapter on social impacts, in which health featured strongly, reflects the tone of the recent Lancet report, albeit with less detail. It considered wider health benefits of the project, including better access to health facilities and employment opportunities, improved road safety, opportunities for walking and cycling, better air quality and enhanced social interaction. 
Of the four environmental impact statements, WestConnex M4 East had the most detailed coverage of mental health issues, mostly related to property acquisition. Despite this, there was limited detail in the health chapter when compared to other issues like air and noise risks. Mitigation measures were limited to the provision of phone counselling services. 
The EIS for each of the other projects lacked assessment of mental health impacts due to construction and operation. 
As outlined above, evidence that links transport and health advocates for access to a mix of transport options, giving people opportunities to walk, cycle and use public transport. The importance of this mix was excluded from the project and parameters set for the two NSW motorway projects. 
While the EIS for each of NorthConnex and WestConnex acknowledged the need for multi-modal transport options, their provision was described as being outside the project’s parameters. It wasn’t clear how or when this was being done elsewhere, only that it was not the proponent’s responsibility and not within the scope of the EIS.
This mix of options was minimal in the 2010 Darlington report we analysed. However, the most recent 2016 iteration of this project design appears to emphasise walking and cycling facilities, with a recent announcement of a rail link adjacent to the motorway.
<h2>Why were health impacts neglected?</h2>
Stakeholder interviews were held with project co-ordinators, consultants, the health department and affected community members for the NSW-based projects. We were unable to conduct interviews for the Darlington case due to changing and uncertain project parameters at the time of the research. 
Informants stressed the importance of the requirements issued to proponents by the state Department of Planning and Infrastructure. Health featured in these requirements, largely on the advice of the state Ministry of Health. 
These requirements focused on environmental health risks, particularly concerning air quality. This corresponded to historical community concerns about motorway impacts. 
Despite an overall consensus that health was an important issue, there was little appetite for comprehensive consideration of broader health impacts, such as those advocated by evidence-based research. Crucially, as reported in the environmental impact statements and confirmed through stakeholder interviews, the design of each project reflects prior financial and strategic decisions. The purpose of the EIS is focused on minimising these risks within those existing design parameters. 
Supporting the considerations behind the light rail, there was reference to the cost savings from the health benefits associated with public transport use. This suggests that health was part of that project’s preceding business case. For the motorway projects, however, our research suggests these early decision points failed to comprehensively consider health impacts. 
If health is to be comprehensively included in the environmental impact statement, it is clear that it needs to be considered much earlier on when the decisions are made on the parameters of the project. Our findings suggest the design of these projects – from business case to assessment – lags well behind the evidence surrounding transport and health. 
The community can be confident that these assessment processes were conducted thoroughly within their set purpose. But the bar for considering the full range of health impacts needs to be raised. This will ensure communities are aware of the long-term impacts of infrastructure provision, and that opportunities to promote and protect health through transport are maximised.
Patrick Harris is senior research fellow, University of Sydney and can be contacted <a href="https://theconversation.com/profiles/patrick-harris-102775" target="_blank">here</a>.
Emily Riley is research assistant , University of Sydney and can be contacted <a href="https://theconversation.com/profiles/emily-riley-315794" target="_blank">here</a>.
<a href="https://theconversation.com/profiles/jennifer-kent-13822" rel="author">Jennifer Kent</a> is research fellow, University of Sydney and can be contacted <a href="https://theconversation.com/profiles/jennifer-kent-13822" target="_blank">here</a>.
All are authors for The Conversation.
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Why transport projects aren’t as good for your health as they could be

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GUEST OBSERVER
The announcement by the NSW Government that a new underground Metro West railway will be the next major public transport project must open up new development opportunities on private land as well as on government owned land.
The announcement that Sydney Metro West will proceed as a rapid transit line between the Sydney CBD and Parramatta is good news.
 Clearly the existing heavy rail is approaching capacity and a new connection is needed between Sydney’s West and East.
The current proposal, as announced by the government, only has new stations on government owned land at the Bays Precinct and at Sydney Olympic Park but there are also options for increased density on privately owned land on sites along the route that should be included. 
The Urban Taskforce has previously suggested other sites for a metro station at Camellia and Kings Bay and there are other areas along the route that should be considered. In order to maximise the public benefits of this costly piece of infrastructure, additional metro stations should be provided.
In March 2015 the Urban Taskforce proposed that Sydney needed a Central Metro line running East West and a Circle Line wrapping around the city. It is good to see that the combination of lines for Sydney Metro has now set the framework for both a Central Line and a Circle Line similar to the Underground in London.
The future of the proposed Parramatta Light Rail will now need to be reconsidered. A Metro system will be far more effective in moving large crowds from Sydney Olympic Park than a Light Rail system. The Light Rail from Parramatta may be better relocated along the Carlingford line towards the North.
It is important that significant density of development including tall buildings is stimulated along the proposed Metro West route and that community members understand that this hugely beneficial piece of transport infrastructure comes with additional growth and density.
The Government’s statement that they will use a market-led approach to delivering the new metro line demonstrates the intention to maximise private sector involvement.
Chris Johnson is chief executive officer of property development industry group Urban Taskforce and can be contacted <a href="https://www.urbantaskforce.com.au/index.php?option=com_content&amp;view=article&amp;id=97&amp;Itemid=126#.Vdaart55dFI" target="_blank">here</a>.
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Metro West must activate development on private land as well as government land: Chris Johnson

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GUET OBSERVER
The announcement by the NSW Planning Minister Rob Stokes that the final strategy for the revitalisation of the Parramatta Road Corridor has reduced the number of homes and added a new levy could slow down development and negatively impact housing affordability throughout the area. 
While it is good to see the finalisation of the 2015 draft strategy for the transformation of Parramatta Road it is disappointing that the proposed housing targets have been reduced by a third.
It was only a few months ago that the Planning Minister announced that Sydney’s population growth was stronger than previously anticipated in the Sydney Metropolitan Strategy, requiring 10% more than expected, so a 33 percent reduction in housing targets in the very desirable inner city area seems to be contrary to government’s policy.
The very detailed planning documents demonstrate significant analysis of the various precincts and seem to have retained heights up to 25 storeys in key locations. The urban amenity plans demonstrate a strong focus on the public domain.
The 5 percent affordable housing levy is an inclusionary zoning tax on development and it will clearly have a negative impact on the feasibility of development along the Corridor. Forcing developers to donate 5 percent of dwellings to a community housing provider is likely to increase the cost of the remaining 95 percent of dwellings.
Hopefully these negative signals to the development industry will not dissuade them from developing in this precinct as Sydney is in dire need of more housing supply. 
The Urban Taskforce supports the need for more affordable housing but we have proposed an incentive based system to encourage 20 percent additional affordable housing based on a similar floor space uplift. The Parramatta Road approach seems to be an overall reduction in floor space with an added tax to produce affordable housing and this could negatively affect the feasibility of projects.
Chris Johnson is chief executive officer of property development industry group Urban Taskforce and can be contacted <a href="https://www.urbantaskforce.com.au/index.php?option=com_content&amp;view=article&amp;id=97&amp;Itemid=126#.Vdaart55dFI" target="_blank">here</a>. 
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Parramatta Road housing reduction and proposed levy could slow down development

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GUEST OBSERVER
Last week Fairfax Media reported that the Parramatta Light Rail is set to cost the NSW government not A$1 billion (together with part of the proceeds of a levy on new residential developments), as budgeted, but a whopping A$3.5 billion.
People could be forgiven for thinking that the revelation of a A$3.5 billion price tag is surprising, and much higher than expected from what’s been budgeted. But as a new Grattan Institute report shows, cost overruns in public transport infrastructure are far too common.
The report is the first comprehensive Australian study of all 836 transport infrastructure projects valued at A$20 million or more and planned or built since 2001. It reveals that over the past 15 years, Australian governments have spent A$28 billion more on transport infrastructure than they told taxpayers they would spend. Much of this overspending should never have happened. 
The A$28 billion over the originally promised costs does not stem from the accumulation of small cost overruns on most projects. Rather, most projects come in reasonably close to their original announced cost, as the figure below shows. The problem is that when projects do run over, it can be spectacular: 90 percent of the cost overrun problem is explained by the 17 percent of projects that overran their cost promise by more than 50 percent.
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The main culprit for this startling finding is premature announcements. Ministers and shadow ministers frequently promise to build a road, bridge or rail line for a particular cost, especially in the lead-up to an election. 
History shows that projects with costs announced before a formal budget commitment are at much more risk of a large cost overrun than those announced when they are better developed. Over the past 15 years, 74% of the total value of cost overruns is explained by the 32% of projects announced early.
The poor performance of projects with early announcements is not just a warning to mistrust politicians’ promises. Premature cost announcements continue to haunt projects throughout their lives, as the figure below shows.
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It is not common practice to analyse projects from as far back as when they are first announced, but it should be. Once politicians have announced a project, they and the public treat that announcement as a commitment. They are right to do so: two-thirds of these projects end up being built. 
In fact, it is not common practice to analyse the cost outcomes of infrastructure projects in any systematic way. Analysts are hindered by the absence of meaningful reporting on the outcomes of these projects – by the lack of information on how well they performed against the costs and benefits, such as travel time savings, that were used to make the original investment decision.
Failing to collect and aggregate information about past projects also hampers those trying to estimate what today’s projects will cost. Without actual Australian data on past projects, cost estimators may be able to factor in the prices of equipment, material and the workforce, but they can’t factor in how to protect against unusual and unforeseeable events that can have a big impact – “unknown unknowns”.
Today’s projects suggest we are not learning from history. For every project, cost estimators forecast what they expect the project will probably cost (known as a “median” or “P50” cost estimate), and also what it could cost for the one in ten times that a project will probably go over budget – a “worst case” cost estimate (known as a “P90”). 
The experience of the past 15 years shows that the difference between the median cost estimate and the “worst case” cost estimate is 21% on average for transport infrastructure projects valued at A$20 million or more. 
But cost estimates for current projects do not reflect this experience. Instead, the difference between the median and “worst case” estimates is generally about a third to a half this size. Judging by recent history, this suggests that either the median cost estimate is too high or – more likely – the “worst case” cost estimate is too low. 
What’s wrong with this approach is that it probably won’t be one in ten projects that governments are expecting, but actually more likely one in three, that go over the “worst case” estimate. 
Our research also shows that, if history is any guide, these overruns will be bigger than expected. Some of today’s big-budget projects that have these surprisingly low “worst case” cost estimates are the Inland Rail between Brisbane and Melbourne, Sydney’s WestConnex and Melbourne’s Western Distributor.
This is not to slight the motives or the abilities of cost estimators, who deal with intrinsically uncertain costs. But without historical information to draw on, these estimates are inherently limited. The evidence is clear: over the past 15 years, cost estimators expected between 10% and 25% of projects to exceed their budget. In fact, 34% did so.
<h2>Policy changes required</h2>
The solutions are within reach. Governments should not commit to building transport infrastructure before tabling a proper evaluation and the underlying business case in parliament. And once a project is completed, governments should report to the public on how it performed against the costs and benefits behind the original decision to invest. 
Governments can also improve project assessment methodologies, collect and publish data that would enable cost estimators to learn from experience, and manage contingency funds with more discipline. 
We must start to learn from history. Our infrastructure systems should promise what is worth having, and then deliver what is promised.
Marion Terrill is transport program director, Grattan Institute and author for The Conversation. She can be contacted <a href="https://theconversation.com/profiles/marion-terrill-169480" target="_blank">here</a>.
 
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Spectacular cost blowouts show need to keep governments honest on transport

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GUEST OBSERVER
When it comes to investment in infrastructure, there’s no question that the NSW Government has work to do. Decades of under-investment in critical services has left a gaping hole, but recent State Budgets have at last announced substantial plans and funding for road, motorways and even more importantly, better public transport.
It’s good news for property as well.  
Infrastructure is vital to economic development and prosperity. Because it comprises the essential services that underpin growth, its development contributes substantially to employment, productivity and competitiveness.
It’s also a very good thing for property markets. Infrastructure upgrades usually result in strong demand in local markets, because property investors will pay more for locations with good infrastructure, or with infrastructure developments in the pipeline.  Transport infrastructure, in particular, both rail and road, makes areas more accessible, and therefore more attractive. This in turn pushes rental growth and occupancy levels in local commercial sectors.
At the same time, infrastructure projects are generally targeted at high growth areas, so this can be used by property developers and builders to estimate employment growth. They boost the local economy by creating new jobs and attracting more people to a precinct, which in turn leads to other, indirect benefits, such as increased consumer spending and the social benefits associated with community development.
According to the <a href="https://www.nsw.gov.au/nsw-regional-infrastructure" target="_blank">NSW Government</a> $20 billion is now being spent rebuilding NSW, and funding to some of the more critical projects has been accelerated. These include the Sydney Metro (City and South-west), the Parramatta Light Rail, Regional Road Freight Corridor and the Western Harbour Tunnel. A new underground railway station at the Barangaroo development in Sydney has also been announced.  In Sydney city, Stage 1 of the Sydney Metro is the $8.3 billion Sydney Metro Northwest is set to open in 2019. Stage 2, extending metro rail under Sydney Harbour and through the CBD is expected to be open by 2024.
For investors seeking to identify areas likely to grow more quickly than others, an understanding of where infrastructure development will be focused is key. Because the effect can be dramatic.  
In 2000, Centuria purchased two properties in Waterloo Road and Byfield Street in Macquarie Park, for $24 million. At that time, there was little infrastructure in the area, and public transport links in particular were poor. Centuria took the view that the area would benefit from planned infrastructure developments, including the Chatswood to Epping Rail Link and the expansion of the Macquarie Centre, both of which were completed. The Macquarie Park office precinct is now larger than the North Sydney office precinct, and there has been an ensuing strong demand for space.
In 2016, Centuria sold the properties for $101 million providing investors with a fivefold increase on their investment and an internal rate of return of over 20% - a significant total return given the sixteen-year life of the fund.
Chatswood is another example of a precinct set to benefit from improved infrastructure and transport links. Sydney’s North Shore office market is already a strongly performing market and in our view is set to perform more strongly still in the coming years. Commercial office space is being withdrawn for residential conversion, which is reducing supply while pushing rents up and vacancy rates down. We believe that the Metro currently under construction will continue to drive above trend growth over the longer term.    
In May of this year, we partnered with global investment manager BlackRock to purchase the best office building in Chatswood -  the Zenith office complex for $280 million. Our 50% stake is held in the unlisted Centuria Zenith Fund, and our forecast is for a 7.6 percent income return in the first year, increasing to 7.7 percent in the 2018 financial year. As for total returns over the life of the fund, we are confident that active management of the property by our specialist asset management team, which includes $30 million in capital expenditure to make the property best in class will result in excellent total returns for investors over the longer term.
Regardless of research or experience, there are no sure things in investment, in property or any other asset class. However, there are themes and trends which influence returns over time. The link between infrastructure spend and the performance of property markets is one of these.
Infrastructure provides essential services that drive economic growth, employment and productivity, and property in the areas where infrastructure is well-developed, performs better than property in other areas. Given the NSW Government’s focus on infrastructure investment, investors would do well to look at areas where money is being spent, and consider the long term possibilities and outlook for commercial property there. 
Jason Huljich is chief executive officer of unlisted property funds for Centuria, and can be contacted <a href="https://centuria.com.au" target="_blank">here</a>.
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NSW infrastructure spend boosts commercial property markets 

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<div class="section">The ABS quarterly survey “Engineering Construction Activity” provides an update of the infrastructure sector, including details on commencements and the work pipeline. Here we provide an overview of the sector.</div>
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Activity: Infrastructure construction work is in the midst of a downturn, from record highs, as the mining boom transitions from the investment stage to the output phase.
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Total real infrastructure activity contracted by almost 10 percent in the June quarter 2016, to be 26 percent below the level of a year ago. That was the fourth year of contraction and follows a fall of 9 percent in the year to June 2015, as well as declines of 3 percent in each of the two years prior to this.
Weakness is increasingly centred on the oil &amp; gas sector, as projects in WA and the NT near completion. Work on other mining projects and mining related projects appears to be stabilising, at a low level, as is work in Qld.
Private non-mining infrastructure activity has strengthened, increasing by 13.5 percent over the past year, centred on NSW and Victoria.
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Public works are trending higher, up from the low of September 2014. Over the past year, public works rose by 16 percent, with further upside near-term.
Commencements: In the June quarter, some $17.0bn worth of projects began work. This adds to the likelihood that the low point for commencements is behind us. For the 2015/16 year, commencements totalled $65.8bn. That is an increase of 8.8 percent on the 2014/15 outcome of $60.5bn. This represents a modest bounce, with commencements still well below the $118bn in 2012/13.
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The turnaround in commencements is being led by the public sector. In 2015/16, public commencements were $32.8bn. That is up $6.2bn on the year prior, centred on roads, rail, and telecommunications.
Private commencements stabilised in 2015/16, at $33.1bn, following $33.9bn in 2014/15, down from $88bn in 2012/13.
Work pipeline: Significant progress has been made in reducing the sizeable work pipeline. The pipeline now stands at $71bn, down from $77bn a year ago and moderating from a peak of $169bn in September 2012.
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Prospects are for a further decline in infrastructure activity as work on key gas projects is completed and given the absence of new mega projects. Public works will provide a partial offset as state governments boost spending on major transport projects. Notably, the value of total work done in Q2, at $22bn, would need to fall by around 20 percent to be in line with the current level of commencements. 
Activity: overview
In the June quarter 2016, the value of infrastructure activity declined by a further 9 percent. Over the past year, activity contracted by almost 24%, following a 10% decline over the previous year.
In dollar terms, the value of work fell by $2.16bn in the quarter, with a $2.28bn fall in private sector activity swamping a $115mn rise in public works. Over the year, activity is down by $6.75bn.
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Private mining
Construction work on oil &amp; gas projects continues to moderate, down $2.55bn in the period, as projects are progressively completed. That brings the decline over the past year to $5.1bn.
Work on other mining projects and mining related projects was relatively stable in the June quarter, declining by only 1%, with a minimal dollar impact. However, over the past year, there was a fall of 50 percent, a decline of $3.2bn. This was as work on pipelines and harbours wound down, as well as a moderation in construction work on coal and iron ore projects.
By way of context to the mining investment downturn, infrastructure work peaked at about $21bn in Q4 2013, is currently around $9.5bn and would fall towards $4bn to be in line with the current level of commencements. On this figuring, close to 70 percent of the downturn in the value of mining infrastructure activity is behind us. (These are Westpac estimates.)
Private non-mining
Private non-resource projects cover roads &amp; bridges, utilities (water supply, sewerage, electricity), telecommunications, and recreation.
Activity in the private non-mining segment strengthened further in the June quarter, increasing by 6.6 percent, a rise of around $300mn. Annual growth lifted to 13.5 percent, up almost $600mn on the level of a year ago. The lift in activity was evident in electricity generation (Victoria) and in sewerage &amp; drainage (NSW).
In the case of NSW, we suspect that there are some positive spill-over effects from the housing boom, boosting the need for infrastructure to service new residential areas. The durability of the lift in private non- mining infrastructure activity remains uncertain. Commencements are yet to establish a clear upward trend.
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Public infrastructure, upturn
The public infrastructure cycle has turned, led higher by a commitment by the state governments to spend more on key transport projects. The public sector now accounts for 1/3rd of total infrastructure activity. Public infrastructure activity grew by a further 1.6 percent in the June quarter, the 6th increase in the past seven quarters. Public works were valued at $7.25bn in the June quarter, $1.0bn above that of a year earlier, a rise of 16 percent.
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There is further upside to activity near-term. Construction work, at $7.25bn, is still running below commencements, which were around $9bn in both March and June. Moreover, the work pipeline has climbed to $19.7bn, up from $12.2bn at the end of 2014, to be above the previous peak of 2010, of $18.7bn.
The upswing in public infrastructure is a nationwide trend. The work pipeline has expanded over the past one to two years in all states. NSW is leading the way, with a work pipeline now at $8.5bn, a near 100% increase on $4.3bn at the start of 2015, to now account for 43 percent of the national work pipeline. As to the $1.0bn increase in public works nationally over the past year, 40% was due to progress on projects in NSW. 
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>. 
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Infrastructure construction work in midst of downturn: Westpac's Andrew Hanlan

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Tourism company Skyline Enterprises said it was reviewing public concerns around its gondola upgrade project at Bob’s Peak in Queenstown and was working to address those.
The Queenstown Lakes District Council has received 19 submissions so far in relation to Skyline’s resource consent application, with most concerns raised about the project’s impact on traffic management, earthworks, the environment and noise.
Skyline Queenstown said in August it had lodged the consent application for the project.
Skyline Enterprises chairman Mark Quickfall said the scale of the project – which involves replacing its current gondola system, building a new base terminal and expanding the top complex – is such that concerns by affected parties were inevitable.
“This is all part of the development process. It’s a major project that involves significant construction works. We are doing everything we can to reduce the impact on our neighbours and will continue to take expert advice on how best to achieve this,” he said.
As part of its upgrade of the fun park at Bob’s Peak, Skyline plans to replace its four-seat gondola system with a quieter 10-seat Doppelmayr gondola, nearly doubling its restaurant Stratosfare’s seating capacity to 650 besides creating more space for views and conferences. The company says the upgrade is driven by an expected rise in tourists to Queenstown over the next 30 years. 
Skyline has also raised its investment on the project to about $100 million from the initial $60 million, the listed company said in a media release. 
The gondolas were installed in 1987 and the upgrade is part of the company’s 50th year of operation in 2017.
The company has handed design options for Brecon Street to the Council and suggested a Council-led panel be set up to examine the issues. 
“We’ve been in regular contact with affected neighbours and other parties throughout this process – as well as holding public open days – and our door is always open to listen to peoples’ issues,” Quickfall said.
It has invited feedback from the public through its Skyline development website www.skylinedevelopment.co.nz.
Skyline said it was working with acoustic engineers, earthworks, construction and operational noise and traffic and parking experts to address the concerns raised before the resource consent hearing.
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Skyline says addressing concerns around Queenstown gondola upgrade

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GUEST OBSERVER
The latest bid for a share of the New South Wales electricity distributor, Ausgrid, from two big Australian superannuation funds is part of a wider investing trend where infrastructure is the new black.
AustralianSuper and IFM Investors announced an unsolicited offer of a reported A$10 billion after two much larger bids from Chinese interests were controversially disallowed by Treasurer Scott Morrison on national interest grounds.
When big infrastructure assets come up for sale in Australia now, there are increasingly only three types of bidders: Chinese state-owned firms, large Canadian pension plans and local superannuation funds.
Superannuation funds have traditionally invested the bulk of their members’ contributions in the share market. The most profitable companies are usually those listed on stock exchanges and holding shares is widely seen as the best way to ensure long term investment success.
But stock markets can also go down, bringing down superannuation balances with them, as many Australians discovered for the first time during the global financial crisis. Investing in infrastructure has developed as an increasingly popular alternative to holding most of a superannuation fund’s investments in shares.
The returns available in infrastructure are comparable to those available on the share market but they have the added advantage of being more stable. Airports, toll roads, ports and utilities (including electricity infrastructure) have become key targets for superannuation fund managers, both in Australia but also increasingly in Europe, North America and Asia.
<h2>Who are AustralianSuper and IFM Investors?</h2>
With an investment portfolio of more than A$100 billion, AustralianSuper is the country’s largest superannuation fund. Formed in 2006 after the merger of the Australian Retirement Fund (ARF) and the Superannuation Trust of Australia (STA), AustralianSuper has a long history of investment in infrastructure.
Long-term ARF and STA trustee (and former ACTU secretary) Bill Kelty is a particular advocate of infrastructure investment. As AustralianSuper CEO Ian Silk acknowledges, much of AustralianSuper’s investment success can be ascribed to Kelty’s emphasis on infrastructure.
Pairing up with AustralianSuper is IFM Investors. Managing more than A$72 billion worth of infrastructure assets, the super fund is the country’s leading player in the infrastructure sector.
IFM was formed in 2004 (as Industry Funds Management) and is the successor to the Development Australia Fund (DAF). It is owned by 29 industry superannuation funds and invests on a global scale.
DAF was launched in 1991 by the ACTU in collaboration with the AMP Society and the Australian Chamber of Manufacturers. Chaired by Ian Court, the head of Cbus (the building and construction industry superannuation fund), DAF led the push of the industry funds into infrastructure investment. On behalf of the industry funds, DAF partnered with AMP in the privatisation of airports, purchased toll road companies and invested in the renewable energy sector.
Like other businesses owned by the industry funds, IFM is run on a cut-price “all profits to members” basis. It buys up infrastructure assets on behalf of the industry funds, allowing their millions of members to profit from government privatisations.
<h2>Super funds leading infrastructure investment</h2>
The Canadians have only recently cottoned on to the idea that investment in airports, shipping terminals and electricity assets is ideal for retirement-savings schemes. Members of superannuation funds expect their nest eggs to grow over the 30 years or more of their working lives. Infrastructure investments match long term financial returns with the long term investment horizon needed by a pension or superannuation fund.
Rather than being sold to foreign firms or wealthy investors, the involvement of the industry funds in infrastructure privatisations means that all working Australians can benefit.
However the movement of the industry funds into infrastructure has been widely criticised by Coalition politicians. In 2007, the then Treasurer Peter Costello dismissed infrastructure investments as “union pet projects…like rats eyeing the grain silo”.
Infrastructure privatisations are controversial. But selling electricity distributors to superannuation funds means that everyday Australian workers can profit from owning them. Unlike investing in derivatives and bonds, infrastructure investment is a form of direct ownership.
Bernard Mees is senior lecturer in Management, RMIT University and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/bernard-mees-182089" target="_blank">here</a>.
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Electricity infrastructure like Ausgrid is a safe bet for super funds

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GUEST OBSERVER
The growing interest in all levels of government in Australia in the concept of value capture has raised concerns in the property development industry. 
Value capture is not a magic pudding that will fund all infrastructure .
Federal, state and local governments across Australia seem to have discovered value capture as the way to boost funding for new infrastructure.
Clearly cities like Sydney will need increased densities around railway stations to house our growing populations and ways to fund new infrastructure need to be carefully considered so that they do not deter or slow down development.
To contribute to the debate on options for funding infrastructure the Urban Taskforce has engaged two respected economists from the Centre for Applied Economic Research at the University of New South Wales Business School to produce a detailed report on ways forward in this important area. 
Professor Kevin Fox and Dr Nigel Stapledon of the Centre for Applied Economic Research have significant experience and knowledge in this area, with Nigel Stapledon being the Head Economist for Westpac for 10 years and Kevin Fox having chaired the Australian Consumer Price Index Review Advisory group for a number of years. 
The findings of the Fox Stapledon report can be summarised through the following 10 areas. 
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There is confusion between the different levels of government on value capture approaches and better alignment is needed. 
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There is a strong case to remove rate capping for Sydney councils. 
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Density is essential near transport infrastructure to increase commuter volumes. 
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A broad-based land tax is the most efficient way of capturing value created by new infrastructure.
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The timing of new value capture taxes is important so that land owners factor this into sales pricing.
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There is a strong possibility that that value capture taxes will raise the cost of housing.
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Stamp duty which increases the cost of housing should be removed as part of a review of property and land taxes. 
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Special Infrastructure Contributions (SIC) in the vicinity of new infrastructure is a second best option to raise infrastructure funds. 
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Government owned land when developed by the private sector should generate value capture but the sale price will reduce. 
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     10. International examples of value capture (London’s Crossrail, Hong Kong’s MTR) are not directly applicable to Australia. 
The overall message from the research report is that governments must not rush into the concept of value capture without understanding the flow on implications of an extra tax on the development industry and the negative impact this can have upon housing affordability. 
There are numerous ways to capture some of the uplift in value from new infrastructure and these will impact on the overall system of property and land taxes. 
The Urban Taskforce is keen to contribute to discussion with the various levels of government on options for the funding of infrastructure related to value uplift. 
We believe the state government is the tier of government that needs to take the lead role on the complex area of infrastructure contributions and the impact on the cost of housing. 
Chris Johnson is chief executive officer of property development industry group Urban Taskforce and can be contacted <a href="https://www.urbantaskforce.com.au/index.php?option=com_content&amp;view=article&amp;id=97&amp;Itemid=126#.Vdaart55dFI" target="_blank">here</a>.
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