Castle Hill’s booming development market is set for another boost, with builder-developer Buildex proposing a new mid-rise apartment building near Castle Towers.

Buildex has submitted plans to The Hills Shire Council for a <a href="https://www.apartments.com.au/new-apartments/197-old-northern-road-castle-hill-nsw-2154">nine-storey building comprising 57 apartments</a> on Old Northern Road. The company acquired two adjoining sites earlier this year, totalling more than 2,683 sqm.

Texco Design has prepared the scheme, which includes five one-bed plus study apartments, 37 two-bedrooms, and 15 three-bedrooms.

Castle Hill has become a hotspot for developers in recent years, undergoing significant transformation driven by the opening of the Hills Showground Precinct to development and the introduction of two metro stations servicing the suburb.

Developers including Deicorp and Kassis Homes have already completed projects, and are progressing future developments, while Meriton, Arada, and Ellipse are currently delivering new projects in the rapidly evolving area.

Staff Writer

First look: Buildex plans 57 apartments near Castle Towers

Gold Coast developer&nbsp;<a href="https://www.apartments.com.au/developers/immerse-projects">Immerse Projects</a>&nbsp;has unveiled what it intends to deliver at its recently acquired Toowong site, its debut apartment development in Brisbane.

Immerse, founded by John Kearney who is also the founder of regarded construction company Greyburn, secured the prime Sylvan Road site <a href="https://www.apartments.com.au/news/qld/first-look-immerse-projects-moves-into-brisbane-apartment-market-with-toowong-site-acquisition">earlier this year</a>, in an area which has historical significance to Kearney who&nbsp;studied at the nearby University of Queensland.

"It feels like a full circle moment," Kearney told&nbsp;<a href="https://www.apartments.com.au/" target="">Apartments.com.au</a>.&nbsp;

“I spent many nights at the Regatta Hotel just down the road, as have most people in&nbsp;<a href="https://www.apartments.com.au/developments/brisbane-qld" target="">Brisbane</a>. It’s one of the city’s most well-known hotels, and with several cafes, restaurants, and a CityCat stop nearby, it’s become an even more attractive place to live.”

He is planning a <a href="https://www.apartments.com.au/new-apartments/22-24-sylvan-road-toowong-qld-4066">15-storey project with 88 apartments</a> above an activated ground plane with a shop and hospitality spaces.

<img alt="Toowong podium" data-entity-type="file" data-entity-uuid="c350436b-9d64-46cc-ab6f-defc009e1b65" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/podium_0.png?VersionId=zt7A0_14M62TkZ61YHnGmEck9KM9HqDA" />

The architecture, led by <a href="https://www.apartments.com.au/interior-designers/bda-architecture">BDA Architecture</a>, presents a tower massing that responds to the area's evolving mid-rise context. The scheme incorporates podium and rooftop communal spaces, while the commercial elements aim to activate the Sylvan Road frontage and enhance the site's interface with the adjacent parkland.&nbsp;

Landscaping plans by Ivy May Landscape Architects include subtropical planting and deep soil zones to support stormwater management and visual integration.

Supporting documentation from Mewing Planning Consultants notes that "the proposed development will deliver a mixed-use outcome that enhances the vibrancy of the Sylvan Road corridor" and highlights its proximity to high-frequency public transport and community facilities.

<img alt="First look: Immerse Projects moves into Brisbane apartment market with Toowong site acquisition" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/22-24%20Sylvan%20%20Rd%20Toowong_Markups.jpg?VersionId=u4_IGzpYLPFfAZSsgCZynov3bm7umwJ." />

&nbsp;

There's been little new apartment development in Toowong in recent years. The most notable is Consolidated Properties two-tower Monarch Residences, which is approaching completion with nearly all of its 224 residences sold.

Kearney describes&nbsp;<a href="https://www.apartments.com.au/developments/toowong-qld-4066" target="">Toowong</a>&nbsp;as a suburb with real depth.

"The suburb attracts everyone, from students to retirees, and that's what makes it interesting."

Joel Robinson

First look: Immerse Projects reveals debut Brisbane apartment development in Toowong

<a href="https://www.apartments.com.au/developers/hyecorp-property-group">Hyecorp</a> is down to its final three-bedroom apartments at Audrey, the developer’s parkside St Leonards South project, pairing the remaining homes with a limited-time offer.

The developer is extending a five per cent deposit and a $50,000 settlement rebate on selected apartments, aiming to help owner-occupiers secure one of the final homes ahead of move-in in early 2026.

[smartcode_project:default project_id=110379 project_image_fid=311393]

Located on Canb​erra Avenue opposite Newlands Park, <a href="https://www.apartments.com.au/new-apartments/audrey-st-leonards-13-19-canberra-avenue-st-leonards-nsw-2065">Audrey</a> comprises 102 residences, including a mix of three-bedroom residences and a double-storey, five-bedroom terrace with two outdoor areas.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/sjb-architects">SJB</a> and delivered by <a href="https://www.apartments.com.au/builders/north-shore-property-construction">North Shore Property Construction</a>, the project reflects Hyecorp’s focus on owner-occupier planning, with open-plan layouts, extensive storage integration, and a material palette built around stone, oak timber flooring and bespoke joinery. Many of the three-bedroom apartments capture views toward the city and Harbour Bridge.

[smartcode_project:default project_id=110379 project_image_fid=207373]

Hyecorp’s internal design team, Jackson Teece, has emphasised a consistent level of specification across the building, including Miele appliances, integrated refrigeration, brushed metal tapware and large-format stone detailing that conceals cabinetry.

The Tiffany Collection, crowning the development on Levels 12 to 15, features added luxury of fluted standalone baths, heated bathroom floors, custom walk-in robes and upgraded appliance packages across its spacious 155 to 159 sqm homes.

[smartcode_project:default project_id=110379 project_image_fid=301367]

Beyond the private residences, Audrey carries a strong amenity focus. Residents have access to an indoor lap pool and spa, personal training studio, private cinema, music room and private dining room.

A landscaped rooftop terrace with CBD views anchors the communal offering, complemented by an onsite café and an integrated daycare centre within the project.

[smartcode_project:default project_id=110379 project_image_fid=198680]

The location continues to be a drawcard for buyers, with new retail additions at Mall 88, including Coles, alongside Woolworths and the established offerings of Forum Plaza. St Leonards Station and Crows Nest Metro is within easy reach, as are local health precincts such as the Royal North Shore Public and Private Hospitals. Nearby green spaces include Newlands Park, Gore Hill Oval and Naremburn Park, supporting strong day-to-day amenity for families and downsizers alike.

Hyecorp is expected to welcome residents to Hyecorp in early 2026.

[smartcode_project_cta:default project_id=110379]

Audrey St Leonards nears completion – settlement bonus now available

<a href="https://www.apartments.com.au/developers/freecity">Freecity</a>&nbsp;has been given the green light to develop its flagship mixed-use project in the Crows Nest metro precinct.

The NSW Government's Housing Delivery Authority approved the 40-storey tower, aligning with the NSW Government's Transport Oriented Development (TOD) agenda to deliver more homes in highly connected, high amenity locations.

The $600 million tower, at 378-398 Pacific Highway, will comprise 178 apartments with resident amenities, two levels of commercial offices, and a curated retail offering. Freecity will also dedicate a 10 percent Affordable Housing Contribution, supporting the Governments broader housing objectives.

<img alt="Freecity Crows Nest" data-entity-type="file" data-entity-uuid="4de9b03b-e8aa-4929-b3f1-6747acbe6b73" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Freecity%20Crows%20Nest%20Project.jpg?VersionId=oWwFWxGj_oUFEYX4j_qRFdSzcShLw3DG" />

Designed by <a href="https://www.apartments.com.au/architects/cox-architecture">COX Architecture</a>, the tower will offer a diverse residential mix, from one-bedroom homes to expansive four-bedroom penthouses, all crafted to maximise light, views and liveability.

Lawrence Zheng, Co-Founder and Joint CEO of Freecity Group, said the approval represents a significant step forward for both Crows Nest and Freecity.

"We are proud to be delivering a landmark project that brings new homes, new amenity and new economic activity to one of Sydney’s most strategically connected locations,"&nbsp;Zheng said.

"With our $6 billion pipeline of 12 mixed-use projects, this development reinforces Freecity’s commitment to helping deliver the housing supply and transport-integrated precincts the Government is championing.”

Michael Romano, Executive Director of Development, said the companies focus is on "creating places that genuinely enhance how people live day to day - communities that balance accessibility, amenity and neighbourhood vibrancy.”

“This project reflects the future of urban living - design led, highly liveable and seamlessly connected to the city’s major transport, employment and education hubs. Being directly opposite the Crows Nest Metro means residents can access the best of Sydney with unrivalled convenience."

&nbsp;

Freecity secures approval for Crows Nest metro precinct tower

The Bedford by Mosaic marks the culmination of a near-decade journey for South East Queensland’s most active developer.

Mosaic Founder and CEO, Brook Monahan, said the company first identified the prime Prospect Street, Kangaroo Point site in 2016 as an A-grade opportunity they were eager to secure. They almost bought it at the time, before it was ultimately acquired by Woolworths’ development arm, Fabcot.

The opportunity resurfaced late last year when the site, vacant for nearly three decades, was offered for sale again.

Backed by years of history, feasibility research, and detailed product planning for the 3,195 sqm corner site, Mosaic was able to move swiftly. The Bedford by Mosaic is now proving a clear market success, unsurprising given the depth of work the developer had undertaken on the location and potential density mix well before they owned the land.

Active across both Brisbane and the Gold Coast, and with a development pipeline more than $2 billion, Mosaic has already sold 90 per cent of apartments in what has become the area’s most significant residential addition in more than a decade.

[smartcode_project:default project_id=134792 project_image_fid=328119]

Designed by BDA Architecture, The Bedford comprises 128 two- and three-bedroom apartments, including the Masterpiece Series Skyhomes across the top two levels. These residences offer the largest floorplans and the best views over the river and city. Premium inclusions—such as natural stone benchtops, bespoke cabinetry, and Miele appliances, feature in every apartment, not just the top-tier offerings.

A defining feature of The Bedford is its integrated mixed-use component, set to deliver Kangaroo Point’s first Woolworths supermarket, along with a café and liquor store, bringing long-awaited convenience to the peninsula.

[smartcode_project:default project_id=134792 project_image_fid=355673]

Residents will also enjoy one of Brisbane’s most comprehensive amenity collections. Dubbed the Rooftop Recreation &amp; Retreat Sky Terrace, the wellness-focused spaces include a resort-style pool with sun deck, an indoor/outdoor gym, spa, sauna, steam room and cold plunge.

Additional amenities include a residents’ lounge and relaxation zones, a private dining room with kitchen, barbecue areas, landscaped gardens, an outdoor viewing deck capturing city and river views, and a bookable golf simulator.

[smartcode_project:default project_id=134792 project_image_fid=355681]

The remaining residences at The Bedford span the upper levels of the building and include two- and three-bedroom floorplans, which start from $1,645,000.

Mosaic's in-house building arm has already commenced construction on The Bedford. They estimate a late 2027 completion.

[smartcode_project:default project_id=134792 project_image_fid=328121]

Monahan notes that Mosaic’s most successful projects often begin years before the first plans are drawn. Their new South Brisbane development is no exception, initially making it onto their radar in 2018.

“We aren’t opportunistic,” Monahan says. “Every site purchase is well considered and thought out. As seen with Kangaroo Point and South Brisbane, it can take years to eventuate. There are sites we are looking at now that we might not secure for several years.”

Mosaic is set to launch its new South Brisbane project&nbsp;in the next year, while its latest Gold Coast development,&nbsp;<a href="https://www.apartments.com.au/new-apartments/josephine-by-mosaic-166-the-esplanade-burleigh-heads-qld-4220">Josephine</a>, is coming soon to Burleigh Heads.

[smartcode_project_cta:default project_id=134792]

A decade in the making: Mosaic's long-awaited success story at The Bedford, Kangaroo Point

Woolworths

Fabcot, the development arm of supermarket giant Woolworths, has gone back to the drawing board to increase the size of their Kangaroo Point, Brisbane, mixed-use development.

They've had local architecture firm Cottee Parker Architects add a further seven levels to the previous development approval, taking the total levels now to 17. That will see the apartment numbers increase from 62 to 130.

The project, slated for 25 Ferry Street which will also front&nbsp;Deakin and Prospect Street's, will have a mix of just seven one-bed apartments, 75 two-bedders, 44 three-bed units and four four-bed apartments.

<img alt="Woolworths Kangaroo Point" data-entity-type="file" data-entity-uuid="5045db25-d04a-4f76-98b3-fc407f1ab58e" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screen%20Shot%202022-10-05%20at%2010.11.20%20am.png?VersionId=_jq.9.Vbgj7DTqWb.9Yq9EMrA68876BC" />

There will be a rooftop pool, gym, and outdoor barbecue space with seating.

The tower will rise above a full-line, 2,240 sqm Woolworths.

Town planner Urbis noted the change application was through further design planning, and the acquisition of another lot to make a 3,197 sqm site.

"The site is in a well-positioned location that boasts strong connections to the river, CBD, Howard Smith Wharves dining precinct, the Story Bridge and a variety of walking and cycling paths," Urbis noted in their submission to the Brisbane City Council.

<img alt="Woolwor" data-entity-type="file" data-entity-uuid="8add64c3-12ad-4794-a426-3495f3145e24" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screen%20Shot%202022-10-05%20at%2010.11.15%20am.png?VersionId=iY9o4TX0cAECzyxlEiQg2kL1msvlYJcq" />

Approval for the former 10-level, 62-apartment project had been granted in December 2021.

The Kangaroo Point project is yet another application submitted by Fabcot so far in a busy 2022. In May they submitted plans in Sydney to&nbsp;reinvigorate an existing retail space in Neutral Bay Village, activating a pedestrian laneway and plaza and building 91 apartments above a Woolworths. The proposal also includes extensive office space.

It was revealed late last year that Woolworths were venturing into the residential development space, with the first announcement a $200 million mixed-use building in Sydney's Waterloo.

The project, to be known as Bourke &amp; Young at 923-935 Bourke Street, is being drawn up by&nbsp;Sydney architects Bates Smart. It is expected to have some apartments dedicated to affordable housing for key workers.

Fabcot plans similar residential and retail projects in Elsternwick and Glen Iris in Melbourne and at Scarborough in Perth.

&nbsp;

It was revealed late last year that Woolworths were venturing into the residential development space, with the first announcement a $200 million mixed-use building in Sydney's Waterloo

First look: Woolworths plot larger Kangaroo Point mixed-use apartment and retail development

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Gone are the days of the weekly shop – now, <a href="/buildings/melbourne-square-93-119-kavanagh-street-southbank">Melbourne Square</a> residents don't have to go far to pick up their daily fresh fruit and vegetables, from the brand new full-line Woolworths.

The recently completed 3,800 square metre supermarket spans two levels across the podium of the building's village-style shopping precinct, alongside an espresso bar, pizzeria, fish and chip shop, as well as Vietnamese and Chinese restaurants and a BWS bottle shop.

The Woolworths supermarket also offers 120 dedicated parking spaces for community use.

<a href="/buildings/melbourne-square-93-119-kavanagh-street-southbank"><img alt="" height="2283" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/melbourne-square-93-119-kavanagh-street-southbank-8d107fa0c127e0b10a58e6df6b938e07.jpeg" width="3425"></a><a href="/buildings/melbourne-square-93-119-kavanagh-street-southbank"><img alt="" height="2283" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/melbourne-square-93-119-kavanagh-street-southbank-36af995925b09a89a044bf59a0174d21.jpeg" width="3425"></a>

<a href="/buildings/melbourne-square-93-119-kavanagh-street-southbank"><img alt="" height="1308" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/screen_shot_2021-03-24_at_12.07.12_pm.png" width="2084"></a>

OSK Property's Sales and Marketing Director Scott Jessop explained that the supermarket delivers required amenity to the growing Southbank population. 

<blockquote>
"Southbank's population is expected to exceed 50,000 by 2036, which is 174 per cent higher than the current population. It is essential that the community is able to access basic everyday amenity so that the area's expanding population can be adequately accommodated.

“We know Southbank residents have been waiting for a full-line supermarket in their local area and we are happy to be able to provide this much-needed amenity, along with other amenities for the community. This is in line with our vision to create an integrated mixed-use lifestyle precinct for Melbourne Square residents and the Southbank community."
</blockquote>

[smartcode_project:default project_id=2929]
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Olivia Round

Vibrant new retail precinct joins Woolworths at Melbourne Square

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Developer Time &amp; Place and Woolworths are set to lodge plans for a mixed-use project in Melbourne's Glen Iris.

Time &amp; Place and Woolworths secured 173 Burke Road earlier this year for $29.25 million, and this week will submit plans to the City of Stonnington for a mixed-use community on the 4,306 sqm site which was bought as a two storey office building.

The plans by Carr Architecture will see 90 apartments located above a full-line, state-of-the-art Woolworths and adjoining BWS at street level. There will be one, two and three bedroom terrace-style apartments.

Each apartment will feature its own external entry, a hero of the project's design, which allows for dual aspect and improved daylight/crossflow ventilation, while also providing an energy efficient end-product.

The project will be targeting 4-Star Green Star Rating from the Green Building Council of Australia.

Time &amp; Place principal Edward Pearse says that the design that has been put forward does not look like a traditional apartment block.

<img alt="" height="1877" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/time_place_woolworths_2.jpg" width="2000">

"It takes cues from suburban living and Australian Modernism to improve this under-utilised portion of the Burke Road."

"The design considers careful integration of the residential and retail elements to ensure a quality living and shopping experience for all end-users.

“We’ve looked to bring the best of traditional terraced homes – from their sustainable design and down to the entry experience – to a higher density project.”

The site has been identified for regeneration as part of the Council’s strategic plan for Burke Road.

Subject to planning approval, the development would create around 250 jobs as well as 120 ongoing retail jobs once complete.

Woolworths State Development Manager Don Foulds said the development application delivers a clear vision to revitalise the site and deliver a thriving, contemporary and convenient mixed-use development.

“Our proposed designs aim to reflect the unique local character of Glen Iris while delivering on Stonnington Council’s vision for high quality housing and convenient shopping for the area.”

The full-line Woolworths will face Burke Road, with the Hope Street frontage to feature an open-air stairway leading to the residences, preserving amenity for neighbours.

<h2>Developments Nearby</h2>

<a href="/buildings/hurstmon-3-hurstmon-street-malvern-east">Hurstmon, Malvern East</a>

Address: Hurstmon - 3 Hurstmon Street, Malvern East

Just over one kilometre away down Wattletree Road in Malvern East is Hurmston, a low-rise apartment development near Malvern Road.

Developed by Landream and designed by Telha Clarke, the apartment building of 39 features one, two and three bedroom apartments starting from $449,000.

<img alt="" height="1123" src="https://s3-ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/pictures/article-images/hurstmon.jpg" width="2000">

The front of the property features carefully curated landscaping that mirrors the surrounding area.

Ground floor residences feature landscaped courtyards that can extend a living space into an expansive entertaining area.

 

 

 
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Developer Time & Place and supermarket giant Woolworths are set to lodge plans for a mixed-use project in Melbourne's Glen Iris.

Developer Time & Place and Woolworths to lodge plans for mixed-use Glen Iris project 

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A Woolworths-anchored shopping complex in South Australia's Playford has sold for $21.81 million to a local private investor.
The deal on the convenience-based shopping centre at 297 Peachey Road, Munno Para, in Adelaide’s north, was brokered by Savills Australia’s Rino Carpinelli and Steven Lerche.
They anticipated strong interest from investors after limited neighbourhood retail opportunities came to market last year.
Mr Carpinelli said, “occupying 2.032 hectares and generating about $1,613,400 per annum, the successful buyer recognised the ongoing value of this asset.” 
“The centre offers significant depreciation benefits backed by a secure income stream and long weighted average lease expiry of 9.12 years by area.”
The centre presents a gross lettable area of 6,390 sqm comprising the full-line Woolworths supermarket and associated BWS liquor store, which are operating under a new 12-year lease.
There is also a mix of 17 speciality tenants, including a Smokemart, newsagency, café, medical centre and Terry White Pharmacy.
Mr Lerche said shopping centres like Woolworths Playford were rarely traded in South Australia.
Woolworths Playford is part of the $1billion urban development project, Playford Alive, which is being jointly managed by the City of Playford council and state government.
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j.ballantyne1990-6AQqhLzZaK

Savills sell Woolworths anchored Playford shopping complex to local SA investor

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Woolworths has divested its self-anchored Banskia Grove shopping centre in Perth’s north eastern growth hub for over $27 million to an offshore private investor. 
Comprised of a net lettable area of 5,721 sqm, the centre at 103 Ghost Gum Boulevard features a nine-year WALE.
It is currently underpinned by 11 specialty tenants, including Terry White Chemist, Plus Fitness and The Coffee Club.  
Woolworths will continue to occupy 3,850 sqm on a 12-year lease with 10 additional five-year options, allowing the lease to run until 2081.  
Anthony Del Borrello and Richard Cash of CBRE’s Western Australian Retail Investments team negotiated the sale of the newly constructed neighbourhood shopping centre. 
Following a five-week international Expressions of Interest campaign, the complex sold to a private Singapore-based investor for $4,768 per square metre on a passing yield of 5.96%. 
The campaign attracted strong enquiry, with the team fielding over 90 enquiries and seven offers. 
<img src="https://www.urban.com.au/images/2019/7/24/2212DAZ_2894.JPG" alt="">
Mr Del Borrello commented that this transaction demonstrated continued demand from offshore investors interested in well-positioned, quality retail assets anchored by strong national tenants.
“In this time, over $70 million worth of retail assets have transacted, including Kelmscott Plaza at $19 million and Coles Vasse, which sold for $19.6 million – both properties were acquired by private Asia-based investors,” Mr Del Borrello said.  
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Private offshore investor buys $27 million Perth shopping centre

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Woolworths Metro will move into the purpose built 1700 sqm ground floor retail space of Granville Place, according to SHOKAI Ausbao and Develotek.
Granville Place is a $400 million mixed-use development in Sydney’s Central River City.
It is one of the Parramatta region’s largest developments.
The design for its ground floor space includes a supermarket, restaurants, café's, retail and speciality stores, childcare and a medical centre.
“We previously joined forces with Woolworths at our The Quay, Haymarket development, so we know the Australian supermarket industry giant is a perfect fit for Granville Place’s higher residential living standards and amenity requirements,” says Jason Gao, from Shokai Ausbao.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/6/20/AUS0853_Granville_S040_EXT_PodiumDay_Final.jpg" alt="">
Justin Nolan, General Manager, Metro Woolworths said, “we’re delighted to be apart of the new Granville development in Western Sydney and look forward to welcoming customers in 2020.”
Construction has already begun on site, with the completion of Stage 1 – Towers A, B and the retail precinct – expected by the end of 2020. 
Stage 2 is expected to be complete in 2021.
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Woolworths to open store at Granville Place in 2020

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EXPERT OBSERVER
After weeks of <a href="https://www.insideretail.com.au/news/macquarie-report-says-up-to-60-big-w-stores-may-need-to-close-201903" target="_blank">speculation</a>, Woolworths has confirmed it will close 30 of its Big W stores in Australia, as well as two distribution centres. This represents <a href="https://www.woolworthsgroup.com.au/page/media/Press_Releases/woolworths-group-market-update/" target="_blank">about 16%</a> of its 183-strong network.
The obvious culprit, and the one identified by many analysts, is online shopping.
As one <a href="https://www.news.com.au/finance/business/retail/woolworths-announces-closure-of-30-big-w-stores-after-slow-profit-improvement/news-story/f8ff7222fded595ec627dd7d9a45e7e8%5D" target="_blank">industry analyst explained</a>: “The physical department store footprint is likely to continue to shrink as online sales penetration increases further.”
Online shopping is certainly a factor, but it is not the primary reason for Big W’s troubles.
Though online shopping in the department and variety stores category is growing fast (by 29.6% in 2018 according to the NAB <a href="https://business.nab.com.au/wp-content/uploads/2019/03/NAB-Online-Retail-Sales-Index-January-19.pdf" target="_blank">Online Retail Sales Index</a>, the total amount of money spent online by Australian shoppers – A$28.8 billion – is still only about about 9% of what is spent in traditional bricks-and-mortar stores.
<hr>
<a href="https://images.theconversation.com/files/267227/original/file-20190402-177163-y5vxk8.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/267227/original/file-20190402-177163-y5vxk8.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Online retail sales growth by industry in the 12 months to December 2018, <a class="source" href="https://business.nab.com.au/nab-online-retail-sales-index-quarterly-update-december-2018-33296/" target="_blank">NAB Online Retail Sales Index</a>
More important to Big W’s woes is the growth of the so-called category killers, which are disrupting the entire discount department store business model. It a threat to which Big W has failed to respond with the same agility of rival <a href="https://www.cmo.com.au/article/658773/kmart-turnaround-king-takes-chairman-post-gyg/" target="_blank">Kmart</a>.
<h2>Departed departments</h2>
If you’re old enough you may remember getting your wall paint mixed in the Big W hardware department, or buying car accessories from its automotive department. There was also a large “sight and sound” department filled with televisions, sound systems, videos and CDs. Discount department stores truly lived up to the idea of a variety store.
<iframe src="https://www.youtube.com/embed/fT8i7hpLGDs?wmode=transparent&amp;start=0" frameborder="0" width="440" height="260"></iframe>
‘You know the price is low, everyday’: A television advertisement for Big W in 1994.
But the profitability of all these market segments for department stores has been eroded by the growth of “<a href="https://www.insideretail.com.au/news/category-killers-breaking-hearts-everywhere-201709" target="_blank">category killers</a>” – retailers specialising in the same product categories.
Examples include Office Works for office supplies, Rebel for sports equipment, JB Hi-Fi for audiovisual, Super Cheap Auto for car parts, and Bunnings for hardware. All have taken market share from the discounters. These stores compete on price and have superior range, and shoppers trust the expertise of staff working in a specialist shop.
<h2>Speed of change</h2>
The popularity of category killers explains in large part the stagnant sales and talk of store closures throughout the department store segment.
Harris Scarfe and Best and Less <a href="https://www.insideretail.com.au/news/greenlit-brands-holds-off-disaster-201810">are reportedly</a> struggling. The Reject Shop’s net profit for the first half fell from an expected A$17 million to less than <a href="https://www.afr.com/business/retail/reject-shop-shares-plunge-40pc-after-profit-downgrade-20181017-h16qqu" target="_blank">A$11 million</a>. <a href="https://www.afr.com/business/retail/david-jones-interim-profits-plunge-39pc-20190221-h1bisz" target="_blank">David Jones’</a> half-year profit fell 39% to A$36 million. <a href="https://www.powerretail.com.au/multichannel/myer-1h2019-results/" target="_blank">Myer</a> reported a 2.8% drop in total sales for the same time frame.
Wesfarmers expects earnings from its department store brands Kmart and Target to fall about 8% this financial year. Eight Target stores closed during the first half of the financial year, with another six closures expected by the <a href="https://www.wesfarmers.com.au/docs/default-source/asx-announcements/2019-half-year-report-(incorporating-appendix-4d).pdf?sfvrsn=0" target="_blank">end of June</a>.
<h2>Cutting losses</h2>
Kmart is considered Australia’s discount department store “darling”. A decade ago it was on life support. Under the direction of chief executive Guy Russo <a href="https://www.afr.com/business/retail/wesfarmers-sticking-with-its-strategy-despite-setbacks-for-target-and-coal-20160624-gpr87n" target="_blank">it doubled it profits by 2015</a>.
A key to the turnaround was recognition it needed to quickly reduce or exit categories it could not compete in, such as hardware, automotive, fishing, consumer electronics and sporting goods. It has <a href="https://www.news.com.au/lifestyle/home/interiors/meet-the-woman-behind-discount-retailers-cheap-homewares/news-story/c3b87320cea433d89b2d894f34438c4a" target="_blank">turned to</a> homeware, soft furnishings, manchester and kitchenware.
There appears no such swiftness in Big W’s moves.
Big W’s chief executive from January to November 2016, Sally MacDonald, reportedly wanted to closes stores and make other major changes but <a href="https://www.afr.com/business/retail/woolworths-to-shut-30-big-w-stores-20190401-p519jr" target="_blank">was thwarted by the board of Woolworths Group</a>, owner of Big W.
Such differences in strategic vision explain why MacDonald left the role within the year.
This process of “right-sizing” therefore seems long overdue. To what extent it makes Woolworths a sustainable business, however, will depend on future response to changing circumstances.
What is certain is that discount department stores aren’t what they used to be; and if they want to be around in future, they probably can’t be what they are now.<img src="https://counter.theconversation.com/content/114630/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
<a href="https://theconversation.com/profiles/gary-mortimer-1322" target="_blank">Gary Mortimer</a>, Associate Professor in Marketing and Consumer Behaviour, <a href="http://theconversation.com/institutions/queensland-university-of-technology-847" target="_blank">Queensland University of Technology</a>
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/the-trouble-with-big-w-dont-blame-online-for-killing-discount-department-stores-114630" target="_blank">original article</a>.
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jrobinson-rf4aSBido9

The trouble with Big W: don't blame online for killing discount department stores

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Woolworths has increased its lead as Australia’s top grocery retailer increasing its share of Australia’s total grocery market to 34% in 2018, up 1.4ppts from a year ago according to Roy Morgan’s latest survey data.
Their data showed, while Woolworths increased its market share the newly independent Coles now has a share of 27.6% of the total grocery market down 1.6ppts on a year ago.
 German supermarket chain Aldi has grown its market share to 11.4%, up 0.5ppts from a year ago.
Other Supermarkets outside the ‘big four’ such as 2018 Foodland, Foodworks and others increased their share of the total grocery market to 9.1% (up 1.2ppts) while IGA’s grocery share was down 0.4ppts to 7.1%.
Total grocery market – % market share 2017 cf. 2018
<a href="https://www.propertyobserver.com.au/images/2019/4/8/MARKET%20SHARE%20.png" target="_blank">Click here</a> to enlarge:
<img src="https://www.urban.com.au/images/2019/4/8/MARKET%20SHARE%20.png" alt="">
 
Source: Roy Morgan Single Source. 
Michele Levine, Roy Morgan CEO, commented that the impressive performance of Woolworths over the last year has Australia’s leading grocery retailer in a strong position to deal with the entry of German ‘hypermarket’ Kaufland into Australia’s $100 billion+ grocery market:
“Australia’s leading supermarket chain Woolworths has increased its lead in Australia’s increasingly competitive grocery market in 2018 now capturing over a third of Australia’s total grocery spend in 2018 – up 1.4ppts to 34% from a year ago."
“The successful year for Woolworths has been built upon strong performances across the four key categories of fresh food. Woolworths has grown its market share in dollar terms for fresh meat, fresh deli, fresh bread and also fresh fruit and vegetables and is the market leader in all four categories ahead of main rival Coles."
“The demerger of Coles Group from industrial conglomerate Wesfarmers in the December quarter of 2018 means Australia’s second largest supermarket chain now has the opportunity to refocus on its core business ahead of the imminent arrival of German retailer Kaufland."
“Kaufland has already bought six industrial sites in Melbourne at which it plans to open its successful ‘hypermarkets’ over the next two years before rolling out stores Australia-wide following in the footsteps of fellow German retailer Aldi. Aldi also had a good year in 2018 and grew its share of the total grocery market by 0.5ppts to a new high of 11.4%."
“In addition to Kaufland the Australian grocery market is also anticipating a rollout of the ‘Amazon Fresh’ brand in the near future after the American Internet giant launched a food and grocery segment (although not yet fresh food) in the December quarter 2018."
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Woolworths grew grocery market share to 34% 2018: Roy Morgan

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Ivanhoe’s Woolworths full-line supermarket and BWS has hit the market with expectations of more than $20 million.
The 3,552 square metre retail asset is located at 72-84 Upper Heidelberg Road.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2019/3/28/72-84%20Upper%20Heidelberg%20Road%20Ivanhoe%20-%20IMG%202.jpg" alt="">
Savills Australia’s Benson Zhou, Clinton Baxter, Julian Heatherich and Jesse Radisich have been appointed to market the property.
Zhou said they expected interest from private local and offshore investors. 
“We have three local agents and four Asian Services agents working timelessly on this campaign, and have been extremely busy answering enquiries from overseas and organising inspections,” he said.
“We have received a decent level of interest from Asian investors indicating their willingness to offer more than $20 million. 
“Chinese investors have found a great level of security in the Woolworths brand so we’re also anticipating strong contest from this buyer group, particularly given the premium Ivanhoe location – one of the best suburbs they can expect to buy a full-line Woolworths in Melbourne.” 
Zhou said the long-term lease to Woolworths Limited would be a drawcard for prospective buyers. 
“The 15-year lease covenant with six five-year options to renew is a secure investment proposition, generating a net income of about $917,078 per annum,” he said.  
Baxter said a recent $4.9 million upgrade to the premises was another key selling point.
“The asset presents significant depreciation benefits of about $14.5million,” he said. 
The property includes 178 basement car parks on title. 
Zhou said the retail catchment area would grow in line with the suburb’s population. 
“The City of Banyule’s population is forecast to grow to 147,098 by 2036,” he said. 
“As a result, there is increased residential development in the area, and a gradual upward trend in the value of building approvals.” 
Expressions of interest close Wednesday, April 10 at 2pm.
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Woolworths supermarket in Ivanhoe listed with $20 million expectations 

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A Woolworths-anchored shopping complex in Munno Para, a northern suburb of Adelaide, has hit the market.
The convenience-based shopping centre at 297 Peachey Road occupies a two hectare site and generates around $1,613,400 per annum. 
The centre presents a gross lettable area of 6,390 sqm, comprising the full-line Woolworths supermarket and associated BWS liquor store, which are operating under a new 12-year lease. 
There is also a mix of 17 speciality tenants, including a Smokemart, newsagency, café, medical centre and Terry White Pharmacy. 
 Savills Australia’s Peter Isaksson, Rino Carpinelli and Steven Lerche have been appointed to conduct the expressions-of-interest campaign.
They anticipate strong interest from investors after limited opportunities came to market last year.
“There is no doubt there is pent-up demand from investors wanting to enter growth areas such as Playford,” Isaksson said. 
“Buyers are looking to capitalise on Adelaide’s northern growth corridor and the large number of dwellings to be constructed within the city’s fastest-growing precinct.” 
Woolworths Playford is part of the $1 billion urban development project, Playford Alive, which is being jointly managed by the City of Playford council and state government.  
The precinct comprises popular suburban-lifestyle facilities, such as healthcare, education, recreation and a new $250million town centre. 
Rino Carpinelli said shopping centres like Woolworths Playford were rarely traded in South Australia.
“This centre serves the everyday needs of the local community and is classed as a defensive asset, driven largely by non-discretional shopping,” he said. 
“The centre offers significant depreciation benefits backed by a secure income stream and long weighted average lease expiry of 9.12 years by area,” Mr Isaksson said.
Carpinelli expects investors to be interested in the new and highly regarded retail precinct. 
He went on to say that the shopping centre’s location within a new and highly regarded retail precinct would be a key selling point for astute investors.
“The centre is strategically positioned to benefit from uplift in local retail spend in the coming years, with the main trade area population estimated to increase from 35,340 people as at June 2018, to 47,890 people by 2031,” he said. 
“Similarly, the current retail trade area expenditure of $397 million is forecast to significantly grow to $720 million by 2031.”
 
 
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