<p>Perth’s new apartment market recorded its strongest quarter of sales since Q4 2021, with 412 apartments sold in Q1 2026 and a record quarterly sold value of $537 million, according to Urbis’ latest Apartment Essentials results.</p>

<p>Urbis said the March quarter result reflects strong, highly product‑specific demand across both ends of the market, from more attainable projects delivering at scale, through to premium stock being absorbed by equity‑rich downsizers.&nbsp;</p>

<p>David Cresp, Partner at Urbis, said the key story in Perth is not demand, it is the market’s ability to convert demand into delivered housing.&nbsp;</p>

<p>“This is the strongest sales quarter since Q4 2021, and it reinforces that demand in Perth is real and it’s local,” David Cresp said. “But the task now is delivery, turning that demand into projects that can actually be built and completed.”&nbsp;</p>

<p>[smartcode_project:default project_id=110291 project_image_fid=302785]</p>

<h2>Affordable product leads, premium demand remains resilient</h2>

<p>Sales in Q1 were led by more affordable projects, with The Boulevard (SKS Group) recording 115 sales in the quarter, the presentation noting this is only the second time a single project has surpassed 100 quarterly sales. The project was able to offer more affordable housing product right next to a train station.&nbsp;</p>

<p>Palmyra West (Finbar) also delivered strong results with 28 sales in Q1, following 84 sales in Q4, with an average price of under $800,000, underscoring depth of demand for well‑located, attainable new stock.&nbsp;</p>

<p>At the premium end, Urbis said downsizer demand is continuing, with the results highlighting Romeo (Applecross, Finbar) recording 75 sales and reaching almost 50% sold in one quarter.</p>

<p>Jual (Shenton Park, Celsius Property) also posted a strong quarter with 28 sales, reaching 39% sold in one quarter.</p>

<p>Urbis noted that Perth apartment demand is not speculative, not investor‑led, and not uniform, describing it as localised, often equity‑driven and highly product‑specific, a pattern reflected in the polarisation between strong “attainable” performers and premium downsizer product.&nbsp;</p>

<p>[smartcode_project:default project_id=148957 project_image_fid=364102]</p>

<h2>Prices underpinned by costs, and the delivery risk is growing</h2>

<p>Urbis said pricing pressure is cost not demand‑driven: construction costs and delivery risk are now a central constraint, with the results noting build costs remain elevated and volatile, and that energy, fuel and labour uncertainty weigh on feasibility.</p>

<p>David Cresp said a growing challenge for private Build‑to‑Sell developers is simply securing a builder in the current environment.</p>

<p>“Developers are really feeling the pressure from a building market that was operating at capacity and securing a builder is challenging,” David Cresp said, adding that even where a builder can be secured, “trying to get to the price that makes the development financially viable is incredibly challenging in the current market.”&nbsp;</p>

<p>Urbis’ broader WA commentary also notes that industry remains at or above capacity with lot and housing creation, and that many builders are limiting new sales to manage stretched workforces and fixed‑price contract pressures, conditions that flow directly into apartment feasibility and delivery timing.</p>

<p>[smartcode_project:default project_id=108869 project_image_fid=317905]</p>

<h2>Supply: improving later, but still constrained, and Perth lags eastern benchmarks</h2>

<p>While near‑term supply remains constrained, Urbis’ forecast shows completions lifting “Supply is forecast to be back above 1,500 apartments per annum for the first time since 2019”, with 1,775 completions forecast for 2026, and volumes remaining above that level over the following years.&nbsp;</p>

<p>Looking further ahead, completions are forecast to reach 2,500 in 2028, with the report noting 32% of that total is social/affordable, reflecting the role of government‑supported delivery in rebuilding the pipeline.&nbsp;</p>

<p>However, Urbis said Perth remains behind comparable markets on pipeline scale. In a national comparison of projects under construction, the report shows under construction Perth Build‑to‑Sell (BTS) at 3,446 apartments versus the Gold Coast at 7,922. Mr Cresp said “The challenge for Perth is how to we grow the delivery pipeline”.</p>

<p>Urbis’ conclusion is that Perth’s market is increasingly defined by product discipline and delivery certainty, with the research identifying “delivery certainty is key” and calling out builder risk and procurement models as core success factors, alongside “timing and staging”.&nbsp;</p>


Joel Robinson

Perth apartment sales hit strongest pace since late 2021 as builder capacity tightens

<p><a href="https://www.apartments.com.au/developers/sammut-developments">Sammut Group</a> has secured development approval for its latest Brisbane apartment project, marking the Sydney developer’s next step in expanding its Queensland pipeline following the success of its debut Gold Coast development, Coast.</p>

<p>The approved project at <a href="https://www.apartments.com.au/new-apartments/44-glen-road-toowong-qld-4066">44 Glen Road, </a><a href="https://www.apartments.com.au/developments/toowong-qld-4066">Toowong</a> will deliver a 15-storey riverfront apartment building with 42 residences, significantly increasing the scale of the site’s previous approval for a smaller luxury scheme. Designed by Bureau^proberts, the development will comprise a mix of predominantly four-bedroom and two-bedroom apartments positioned to maximise Brisbane River and city views.</p>

<p>Sammut Director Julian Sammut said the group had been actively searching Brisbane for several years before identifying Toowong as the right fit.</p>

<p>“Brisbane was the right step for Sammut,” Sammut said.</p>

<p>“With the success of Coast we thought we should definitely look to do more in Queensland alone. We then pushed up to look at Brisbane. We've been looking for I'd say two to three years actually and it was hard to find the right location.”</p>

<p><img alt="Sammut makes Brisbane apartment play" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_75/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Screenshot%202025-12-23%20at%203.27.14%E2%80%AFPM.png?VersionId=dYAVIL7qdcGA8ojvkslSrLjczXFejSSx" /></p>

<p>Sammut said suburbs including New Farm and Teneriffe were considered before the group ultimately focused on Toowong due to its strong downsizer demographic and limited supply of developable riverfront land.</p>

<p>The site was acquired off-market after what Sammut described as a lengthy negotiation and planning process, with the developer pursuing an uplift to the original approval.</p>

<p>“We are DA approved now which is very exciting,” Sammut said.</p>

<p>“We've had our change approval come through and we've obviously doubled the height, 15 storeys plus rooftop. We've got 42 amazing apartments that are going to be coming to market soon.”</p>

<p><img alt="Sammut makes Brisbane apartment play" 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/Screenshot%202025-12-23%20at%203.27.26%E2%80%AFPM.png?VersionId=ohkRkY0dIZlqdfME2EZePsCQavRiBadE" /></p>

<p>Bureau^proberts said the design responds to Toowong’s evolving urban character, balancing contemporary apartment living with the area’s established residential identity.</p>

<p>“A place where traditional Queensland living has taken place for centuries; Toowong is seeing a shift of contemporary influence, commercial and retail hubs mixed with well-considered residential offerings – all the while maintaining its character and charm,” the architect noted in planning documents submitted to Brisbane City Council.</p>

<p>The architecture practice said the project’s form was shaped by its riverfront setting, flood considerations, neighbouring building scales, and view corridors.</p>

<p>“They said the mix of four and two-bedroom apartments capture the ‘fundamental qualities of Queenslander living,’ translated into the context of a contemporary subtropical building.”</p>

<p>The development sits just off Coronation Drive within walking distance of Toowong’s retail precinct and the upgraded Regatta ferry terminal, while also benefiting from proximity to the incoming green bridge connection to West End. Sammut said the accessibility and amenity offering were central to the site’s appeal.</p>

<p>The approval adds to growing residential activity along the Toowong riverfront, joining nearby projects including Consolidated Properties’ Monarch Residences and Spyre Group’s ARC Residences.</p>


Sammut secures approval for debut Brisbane apartment development in Toowong

<p>Developer Lanevick is heading back into Sydney’s apartment market after focusing more heavily on the luxury townhouse and terrace sector in recent years.</p>

<p>Lanevick, founded and directed by Steve Maroun, is expecting to receive approval in the coming months for a new apartment development in Gladesville, with the aim to launch it to the market later this year.</p>

<p>The 51-apartment project, designed by Studio Johnston, will comprise a mix of one-, two-, and three-bedroom apartments positioned toward the Hunters Hill downsizer market.</p>

<p>“Traditionally it’s been difficult for people in that market to downsize because there just hasn’t been the right product available,” Maroun said.</p>

<p>“We’re targeting buyers who might have 30 to 40 per cent of their house value sitting in the bank after downsizing.</p>

<p>“They still want good spacious entertaining areas, they still want quality design, but they also want flexibility and the ability to enjoy life a bit more after working hard for a long time.”</p>

<p>The project sits near Boronia Park and within close proximity to the Parramatta River foreshore, an area Maroun says offers more of a Hunters Hill lifestyle than a traditional apartment precinct.</p>

<p>“From a lifestyle perspective, it’s really more Hunters Hill than Gladesville,” Maroun said. “You’re close to the foreshore, close to parklands, and still connected back into the village precinct.”</p>

<p>From level four and above, apartments will capture water views&nbsp;toward Sydney Harbour. Communal amenity will include rooftop entertaining areas, wellness spaces, and a gym tailored toward owner-occupier buyers.</p>

<p>“We’ve really designed these apartments around that buyer coming from the Hunters Hill LGA and what they’re actually looking for in their next chapter.”</p>

<p>The proposed development has also been designed to respond to the changing character of the broader Gladesville town centre, where a growing number of mixed-use and residential proposals are expected to emerge over the coming years.</p>

<p>“Gladesville presented a rare opportunity to deliver a genuinely design-led residential project within an evolving lifestyle precinct, just moments from the growing Gladesville town centre, and we’ve approached the project with a strong focus on architecture, liveability and long-term community value,” Maroun said.</p>

<p>Maroun said Lanevick saw a first-mover advantage within the precinct as planning controls continue to evolve to accommodate greater housing density.</p>

<p>“We think there’s a real opportunity there that hasn’t really been serviced properly yet,” he said.</p>

<p>“There’s going to be a broader evolution of the whole Gladesville village precinct over time, particularly with more activation and mixed-use outcomes.”</p>

<p>The Venus Street proposal will include a commercial and retail component at ground level designed to contribute to that evolving streetscape activation.</p>

<p>“A big part of the thinking was how do you activate that area properly and create more vibrancy and amenity, which is what Hunters Hill has been looking for,” Maroun said.</p>

<p>Lanevick’s focus since 2020 has largely been on smaller-scale luxury townhouse and terrace developments. The developer recently completed Royale Randwick, also designed by Studio Johnston, where prices reached $3.65 million. The project was featured in the UDIA NSW 2026 Professional Development Prospectus and was also named a finalist for Development of the Year.</p>

<p>&nbsp;</p>


Lanevick to cater for Hunters Hill downsizers with new Gladesville apartment development

<p>Property developer One Living, backed by former Macquarie banker turned investment manager Chris Green’s investment firm, has unveiled plans to bring more institutional capital into housing to help address the national supply crisis.</p>

<p>The New York-based investor has focused his firm, GreenPoint Partners, on addressing the supply shortage hitting middle market housing in Australia.</p>

<p>It is backing the new One Living business to develop more than 1000 units along the eastern seaboard. The new firm is starting with a development on Mona Vale Road, on the border of Mona Vale and Pymble, in Sydney’s Northern Beaches, with around 140 apartments planned. They are eyeing off more sites across the city.</p>

<p>With cost pressures rising in the industry, One Living’s model is to be a vertically integrated developer-builder, so it can respond directly to the housing gap by removing the cost inefficiencies embedded in traditional residential delivery.</p>

<p>“We are building a platform designed to operate at scale and starting in a market where there’s a clear need for quality, attainable housing,” One Living joint managing director Joseph Scuderi said.</p>

<p>“It’s that missing middle – it’s that attainable end of housing… that’s what most Australians invest into and what Australians can actually afford.”</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="798dfa93-4941-4db6-a696-31e9dc18e81c" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.31.50%E2%80%AFPM.png?VersionId=mKBqi5C_DmeiXS.AtJkcR8LQIxqCqmFi" /></p>

<p>GreenPoint Partners brings years of experience assembling and scaling real estate operating businesses across major markets. And Green sees a big opportunity in Australia.</p>

<p>“For its size, sophistication and importance to the community, Australia’s living sector has remained largely under-institutionalised, which represents significant opportunity,” Green said. “GreenPoint identified that gap, assembled the right team, and is backing One Living to build a platform that is aligned to market needs.”</p>

<p>Green said being a builder-developer would give the company the capacity and flexibility it required to deliver reasonably-priced homes.</p>

<p>“We want it to be at that attainable level; not super high end luxury but at that attainable level,” he said.</p>

<p><img alt="Mona Vale" data-entity-type="file" data-entity-uuid="74a5344a-4b26-4d4a-ada3-056b1220be77" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-05-28%20at%202.32.15%E2%80%AFPM.png?VersionId=vY8hXHO4reBMdO8ZXMWCNtGZJofUPQ3j" /></p>

<p>&nbsp;</p>

<p>One Living will undertake a component of affordable housing in its schemes, which it will own and operate, and it could also run build-to-rent on some sites.</p>

<p>Green praised local policy settings.</p>

<p>“The NSW government is being very supportive, strategic and pragmatic in terms of how do we generate more supply of housing,” he said. “We think it’s actually positive for development and the bit that’s been lacking at that attainable level is that it’s lots of relatively small private developers, whereas we want to create an institutional platform.”</p>

<p>One Living is also&nbsp;looking at high-density projects and could take on more institutional funding in the future.</p>

<p>“The way we will be able to achieve economies of scale is through size,” Green added.</p>


One Living enters Sydney's new apartment market with Northern Beaches site acquisition

<p>It's been several years since there's been an opportunity to buy a brand new townhome in Melbourne's coastal suburb of Mordialloc. Even apartment developments in recent times have been few and far between in the area.</p>

<p>Local developer LDS Property identified the gap in new housing, securing a site on White Street, directly opposite&nbsp;Woodlands Golf Club Mordialloc. They've recently launched&nbsp;<a href="https://www.apartments.com.au/new-townhouses/wm-residences-mordialloc-102-white-street-mordialloc-vic-3195">WM Residences</a>, just 13 townhouses which they have already started building.</p>

<p>Projects by Buxton Director Heath Thompson, who is selling WM Residences, says the townhouses x that perfect middle ground be</p>

<p data-end="683" data-start="511">"Mordialloc residents have had limited options to downsize within the suburb, often forcing them to look elsewhere despite long-standing ties to the area," Thompson says.</p>

<p data-end="882" data-start="690">"With very little comparable new supply coming to market, projects like WM Residences are well placed, particularly as buyers look to capitalise on current conditions amid constrained supply."</p>

<p data-end="882" data-start="690">[smartcode_project:default project_id=134646 project_image_fid=6109]</p>

<p>The development, designed by regarded architecture firm&nbsp;<a href="https://www.apartments.com.au/architects/ewert-leaf">Ewert Leaf</a>,&nbsp;adopts a deliberately restrained architectural approach, focusing on simplicity, durability and liveability rather than overt design gestures.</p>

<p>The boutique scale is central to the offering. With only 13 three-bedroom residences, each home is configured to prioritise functional layouts and everyday use, supported by private terraces and secure two-car garages.</p>

<p>Ewert Leaf’s design response leans into a calm, neutral material palette. Interiors are defined by oak flooring, white walls and soft finishes, creating a consistent and understated backdrop. The approach avoids trend-driven detailing in favour of longevity, with an emphasis on natural light and spatial clarity.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6110]</p>

<p>Beyond aesthetics, the homes are designed to meet contemporary performance expectations. Each residence targets a minimum 6-star energy rating, incorporating double glazing, comprehensive insulation and all-electric Bosch appliances.</p>

<p>The project’s location supports a walkable coastal lifestyle, sitting within close proximity to Mordialloc’s foreshore, Main Street retail strip and the train station. Local cafés and dining venues, including Suburbia Deli and Hendriks Café, are within a short walk, reinforcing the area’s established neighbourhood character.</p>

<p>[smartcode_project:default project_id=134646 project_image_fid=6116]</p>

<p data-end="247" data-is-last-node="" data-is-only-node="" data-start="0">While <a href="https://www.apartments.com.au/developments/mordialloc-vic-3195">Mordialloc</a> is often defined by its beach and pier, the project taps into other areas of day to day living, offering easy access to local food, casual dining and transport, rather than positioning itself purely as a lifestyle retreat.</p>

<p>WM Residences reflects a continued trend across Melbourne’s coastal suburbs towards smaller-scale, design-led townhouse developments, particularly on infill sites where proximity to amenity is already established.</p>

<p>With construction commenced prior to its market entry, the project aligns with a growing preference among buyers for developments with visible progress and defined delivery timeframes.</p>

<p>[smartcode_project_cta:default project_id=134646]</p>


WM Residences fills gap in Mordialloc townhouse market

Chinese Investment

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<p class="description">Chatswood is the second highest buyer destination of Chinese property investors in Sydney, although Juwai.com’s director Carrie Law says Chinese investors have been turning away from Sydney real estate.</p>
<div class="story-content">
<p>The Golden Week of celebrations, a popular Chinese holiday when China-based buyers have traditionally visited Australia to purchase new housing en masse, proved quieter than normal.</p>
<p>“We still (saw) some transactions, but it’s not the free-for-all of past years,” Ms Law said.</p>
<div class="w650 h365 image media">
<p class="caption">The Sydney CBD has been the most popular area for Chinese buyers.</p>
</div>
<p>Chinese buyers made six per cent fewer inquiries than in the previous quarter and nine per cent fewer inquiries than over the same period last year, according to Juwai data.</p>
<p>The five most popular suburbs for China-based buyers over the past year were the Sydney CBD, Chatswood, Parramatta, Olympic Park and Edmondson Park.</p>
<p>The year before that, north shore suburb Castlecrag was the most popular, followed by the Sydney CBD, Marsden Park, Pyrmont and Ryde.</p>
<p>The Juwai data coincides with a new report that overall Chinese investment into Australia slumped 40 per cent last year, twice the drop worldwide, according the Australian National University, supported by Treasury and with input from the Reserve Bank of Australia.</p>
<p>The report shows Chinese commercial investment peaked in 2016 at $14.9 billion, before falling to $8.9 billion last year.</p>
<div class="cq-article-content-paras section">
<p data-gtm-vis-first-on-screen-7770372_137="9551" data-gtm-vis-total-visible-time-7770372_137="4000" data-gtm-vis-recent-on-screen-7770372_137="18556" data-gtm-vis-has-fired-7770372_137="1">"This is an unusual drop in Chinese investment into Australia," the project's leader Peter Drysdale, who heads the Asian Bureau of Economic Research at ANU told The Australian Financial Review.</p>
<p data-gtm-vis-first-on-screen-7770372_137="9551" data-gtm-vis-total-visible-time-7770372_137="4000" data-gtm-vis-recent-on-screen-7770372_137="18556" data-gtm-vis-has-fired-7770372_137="1">He noted the decrease was significantly larger than the 19.3 per cent fall in China's worldwide foreign direct investment.</p>
</div>
<div class="cq-article-content-paras section">
<p>The database shows $40.4 billion of Chinese money made its way into Australia over the past four years, via 262 transactions.</p>
<p>Last year, the mining sector still accounted for the biggest proportion, making up just over half of the total value of transactions. However, its share has fallen since 2014 as other sectors such as health care and financial technology are starting to attract interest from Chinese buyers.</p>
<p data-gtm-vis-first-on-screen-7770372_137="11556" data-gtm-vis-total-visible-time-7770372_137="1900">"There has been a significant diversification of Chinese investment in Australia," said Professor Drysdale.</p>
</div>
</div>
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Sydney apartment suburbs rank as most popular Chinese property investor destinations

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jrobinson-rf4aSBido9

免费电子书：软着陆还是崩盘？接下来的房价会是多少？

<html><body>
<p>EXPERT OBSERVER</p>
<p>Australia is closing in on the United States to become the primary destination for Chinese offshore capital as domestic regulation forces Chinese investors diversify their strategies.</p>
<p>Australia is the second largest recipient of Chinese overseas capital after the United States, with US$99 billion since 2008, just lower than the US$138 billion that reached the U.S.</p>
<p>But a change of pace in overall capital allocation in the two markets could see Australia nudge in on its rival.</p>
<p>In line with a slowdown in Chinese outbound investment overall, last year, Chinese investment in Australia declined by 11 percent, while in the U.S. it was 35 percent according to the report Demystifying Chinese Investment in Australia, produced by KPMG and The University of Sydney, in collaboration with JLL.</p>
<p>Overall Chinese investment volumes will continue to fall, but Australia’s position remains strong as it continues to be globally competitive in areas that China wants to grow, including real estate, health and wellbeing, technology and mining resources.</p>
<p>And despite capital controls in their own country, Chinese investors remain bullish, as the sheer size of their economy and GDP, forces them to diversify.</p>
<p>“They are investing with a long-term focus – and this is positive for Australia,” says Ferguson.</p>
<p>Australian real estate continues to hold Chinese interest as volumes remain strong globally, with A$4.4 billion invested in the Australian market last year, equating to 11.5 percent of the country’s total real estate allocation.</p>
<p>In fact, despite the drop in overall outbound investment, the volume of real estate snapped up by Chinese investors globally has held strong. JLL’s 2017 China 12 report shows that its total real estate investment, including land sales, totaled US$32 billion – about 20 percent of total investment – which is close to the US$33 billion invested the previous year.</p>
<p>There has, however, been a noticeable shift away from the trophy assets Chinese investors have been known for, and more towards high quality investments regardless of deal size.</p>
<p>The investor profile has changed, too, with private Chinese companies filling the gap left by state owned enterprises, the number of which dropped for the first time since 2014.</p>
<p>The fundamentals of Australian real estate will ensure it continues to hold its own in the race for Chinese capital, says Michael Zhang, Head of JLL’s China desk in Australia.</p>
<p>“The macroeconomic framework is supportive, while the market is attractive from a global perspective,” Zhang says.</p>
<p>“Economic fundamentals are robust, population growth is solid, market transparency is high, and returns are broadly higher relative to comparable markets globally.”'</p>
<p><em>Doug Ferguson is the Head of Asia and international markets at KPMG Australia</em></p>
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Australia competing for Chinese offshore capital

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<p>GUEST OBSERVATION</p>
<p>Chinese infrastructure investment in Australia has rarely left the headlines lately. It’s reported that telecommunications giant Huawei will likely be banned from building Australia’s 5G network on national security grounds. Hong Kong-based company CK Infrastructure’s bid to buy APA Group’s gas pipeline network is also proving controversial.</p>
<p>Scrutiny of the national security implications of infrastructure has been upgraded. The new Critical Infrastructure Centre is assisting the Foreign Investment Review Board in this. Though not made explicit, the main focus is China.</p>
<p>Greater scrutiny of investment projects is welcome, especially if community and environmental concerns are also considered. However, Australia could benefit from the availability of Chinese infrastructure financing.</p>
<p>Australia’s north has significant infrastructure needs. And in the major Australian cities, public transport systems are inadequate, leading to ever-longer commuting times. China also possesses world-class expertise in high-speed rail, which could be harnessed to better connect cities on the eastern seaboard.</p>
<p>Given the state of relations with China and Australia’s pressing infrastructure needs, the Australian government must develop a clear strategy for Chinese infrastructure investment. Instead of passively scrutinising bids, the government should proactively identify worthwhile projects and engage Chinese counterparts to finance and implement them.</p>
<p><strong>Belt and Road isn’t just a political ploy</strong></p>
<p>A proactive approach could benefit Australia because Chinese infrastructure investment is not as strategically directed as many assume. This is clear if we examine the Belt and Road Initiative (BRI) – the centrepiece of China’s global infrastructure financing spree.</p>
<p>The Australian government, on security officials’ advice, has not joined the BRI. However, Belt and Road is not a carefully planned “grand strategy”. It is largely driven by the diverse activities of state-owned enterprises competing for projects and financing.</p>
<p>President Xi Jinping has undoubtedly used the BRI to signal China’s rise to “great power” status. But its main drivers are domestic and commercial. At its core, the BRI is an effort to alleviate China’s industrial overcapacity problem in key sectors, such as steel, glass, cement and aluminium.</p>
<p>Overcapacity has worsened since the global financial crisis, as Beijing sought to maintain growth by encouraging an infrastructure construction boom. State-owned enterprises (SOEs) spearheaded this. After profitable domestic opportunities had dried up, international expansion became attractive, to keep SOEs working and to find more productive outlets for China’s huge foreign currency reserves.</p>
<p>The BRI’s implementation has reflected competition, lobbying and compromises among ministries, provinces and SOEs. Its masterplan document – “Vision and Actions on Jointly Building Silk Road Economic Belt and 21st Century Maritime Silk Road” – is a case in point. It contains 50 “priority areas”. These cover virtually every governmental and non-governmental activity, showing little actual prioritisation.</p>
<p>Early statements suggested a BRI focus on Central and Southeast Asia. But since 2015 the initiative has been formally opened to all countries. This was again due to intense lobbying from provinces, SOEs and some foreign governments. All are keen to get some of the action, suggesting little strategic direction.</p>
<p>The vague and loose Belt and Road plan has enabled considerable scope for interests within the Chinese party-state to use it for their own, economically motivated, agendas, with little consideration for Beijing’s wider diplomatic objectives. This has generated a rather chaotic, “bottom-up” process for selecting and funding projects.</p>
<p>Belt and Road project ideas usually emerge from state-owned enterprises’ in-country subsidiaries. After spotting an opportunity, they try to build support in the recipient government. Occasionally, this includes bribing officials. They also often seek to obtain the local Chinese embassy’s support to improve lobbying back home.</p>
<p>Once agreement with the recipient government is reached, the SOE or the recipient government applies for financing from China’s policy or commercial banks. The banks determine whether to extend credit after assessing repayment capacity. The central government’s involvement is typically limited to the National Development and Reform Commission’s formal approval.</p>
<p><strong>Australia still needs to manage the risks</strong></p>
<p>Chinese infrastructure projects are not risk-free. The potential for misuse of key infrastructure to serve Chinese strategic agendas is clearly the Australian government’s foremost concern. But there are more immediate issues too.</p>
<p>Chinese banks’ lending standards are well below world “best practice”. They give limited consideration to social, environmental and labour protections when awarding financing to projects.</p>
<p>Tough competition between Chinese companies means they have strong incentives to cut corners and promote projects that recipients do not need. The latter can be saddled with unnecessary infrastructure and potentially unsustainable debt. Furthermore, Chinese central agencies’ capacity to regulate SOEs’ offshore activities is weak, so they cannot be relied upon to manage these problems.</p>
<p>Closer scrutiny of investment proposals is, therefore, clearly necessary. So, too, is tight regulation of project implementation. Australian regulators should also ensure Chinese projects adequately resolve social, environmental and labour concerns.</p>
<p>The fragmented nature of Chinese investments provides opportunities, however, for selective engagement that could serve the wider public interest. This should form part of a clear Australian strategy towards China based on a nuanced analysis of both the threats and opportunities of this multifaceted relationship.</p>
<p><em><strong>Shahar Hameiri</strong>, Associate Professor of International Politics, The University of Queensland</em></p>
<p><em>This article was originally published on <a href="http://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/whats-driving-chinese-infrastructure-investment-overseas-and-how-can-we-make-the-most-of-it-98697" target="_blank">original article</a>.</em></p>
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What's driving Chinese infrastructure investment overseas and how can we make the most of it?

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<p>A Chinese syndicate has paid $39.4 million for Mornington Village as the yield for shopping centres in Victoria approaches 5%.</p>
<p>The syndicate of Chinese investors purchased it on a 5.26% yield.</p>
<p>According to CBRE agent Mark Wizel, the centre was making $2.071 million per annum.</p>
<p>The centre contains holds several large contracts including Woolworths and Aldi.</p>
<p>The two level, 7963 square metre (GLA), neighborhood centre, is the fifth neighbourhood centre to be sold the past two months through CBRE’s Retail Investments team, making a total of just under $180 million at on average 5.09% yield.</p>
<p>Mornington Village last sold in January 2014 for $25.8 million on a yield of 7.47%.</p>
<p>Wizel said vendors were confident of getting a good price for their asset while purchasers were buoyed by strong population growth to various parts of Victoria,</p>
<p>He noted the retail assets in high demand were those that had underlying land value with development upside.</p>
<p>He said the national average trend for neighbourhood centres remained above 6% in the year to March, according to CBRE’s Australia Retail Q1 2018 report.</p>
<p>"Eighteen months ago yields for this retail asset class were approaching 6 to 6.5% and they have now firmly settled on an average of marginally above 5% and that is a reflection of the peculiar characteristics of the Victorian market,’’ Wizel said.</p>
<p><em><a href="https://www.propertyobserver.com.au/images/2018/6/6/Screen%20Shot%202018-06-06%20at%2010.36.35%20am.png" target="_blank">Click to enlarge</a></em></p>
<p><img src="https://www.urban.com.au/images/2018/6/6/Screen%20Shot%202018-06-06%20at%2010.36.35%20am.png" alt=""></p>
<p>Dowers said the residential population growth factor along with tourism had driven a string of retail investment sales on the Mornington Peninsula in recent years attracting a broad range of purchasers including institutions, syndicates and private investors.</p>
<p>A strip of retail properties sold recently for just over $6 million, exceeding its reserve price of $4.9 million, as seven buyers contested the 2229sq m 671-677 Point Nepean Road, McCrae offering.</p>
<p data-gtm-vis-first-on-screen-7770372_137="4169" data-gtm-vis-total-visible-time-7770372_137="4000" data-gtm-vis-has-fired-7770372_137="1">The three leases to retailers Kobi Jacks, Alatonero and Merchant Maker café were recently renewed for five years.</p>
<p>A local investor bought the property across two titles at a yield of 3.6%.</p>
<p>Recent sales include Hastings Central Shopping Centre purchased by Henkell Brothers for $32.1 million.</p>
<p>Bentons Square half-share purchased by Vicinity Centres for $38.25 million.</p>
<p>Bunnings Warehouse Hastings purchased by a local syndicate for $15.16 million</p>
<p>Somerville Mall purchased by a private investor for $42.05 million.</p>
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Chinese syndicate pays $39.4 million for Mornington Village

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<p dir="ltr"><span>The Churches of Christ has offloaded a major corner site in Glen Iris for $9.5 million, demonstrating the ongoing demand for boutique development sites in Melbourne’s east.</span> </p>
<p dir="ltr">A Chinese developer was the buyer of <a href="https://www.commercialrealestate.com.au/property/1536-1542-malvern-road-glen-iris-vic-3146-2014139482" target="_blank">1536 Malvern Road</a>, a 1,850 sqm corner site close to Burke Road.</p>
<p dir="ltr">The luxury apartment development site was sold by Savills Australia’s Clinton Baxter, Jesse Radisich, Nick Peden and Benson Zhou.</p>
<p>“The sale price reflects a land rate of $5,135 per sqm, which is a huge result for a site of this nature,” Mr Baxter said.</p>
<p><span><span> <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/2018/3/8/45688_markup%20signboard.jpg" alt=""></span></span></p>
<p dir="ltr"><span>Mr Baxter said 2018 had commenced with “a clear sense of optimism and confidence” throughout the development market.</span> </p>
<p dir="ltr"><span>“The sale campaign generated widespread interest and a 50/50 split of local and Chinese buyers,” he said.</span></p>
<p>“We received 12 separate bids which ultimately resulted in the sale price of $9.5million – well in excess of the $8 million expectations.”</p>
<p>Baxter said that despite media reports of a withdrawal of Chinese money from Melbourne’s commercial property market, Savills was witnessing the opposite.</p>
<p>“That has not been the case for us at all,” he said.</p>
<p>“We are actually experiencing a surge in Chinese interest in the sub-$20million price range right across the market.”</p>
<p dir="ltr"><span>Peden said that with “interest rates effectively on hold for most or all of 2018”, the market was likely to accelerate as the year unfolded and buyer confidence continued to grow.</span></p>
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Chinese buyer swoops on Glen Iris church

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<p>Wandin Valley, the Hunter Valley winery named after a fictional village in the 1980s hit TV series A Country Practice, has been listed for sale.</p>
<p>It last sold for $7 million, less than two years ago when bought by a director of one of China's largest animation studios, Lap Tung Tsoi.</p>
<p>The Lovedale property was originally known as Millstone Vineyard.</p>
<p>The 40-hectare property was renamed Wandin Valley by the creator of A Country Practice, James Davern, and his wife Philippa following their purchase in 1990 for $900,000.</p>
<p>The Davern's redeveloped the property into a winery, building the cricket pavilion-style main residence, manager's cottage, modern cellar, function rooms for weddings, and adding the tourist accommodation.</p>
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<p>It was sold by the couple in 2010 for $4.75 millio to the Mosman couple Katrina and Russell Leslie, who once worked as a Macquarie investment banker.</p>
<p>The estate’s wine history dates back to 1973 when potter-winemaker Peter Dobinson planted a vineyard, calling it Millstone.</p>
<p><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/2018/2/27/wanding%20valley%202.jpg" alt=""></p>
<p>"It is Australian country, blending with Southern European architecture, nestled amongst 35 year old vines and olive groves creates an inspiring setting which ensures customer visitation," Jurds agent Cain Beckett said.</p>
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<p>Tsoi is a director in his family's international animation and toy manufacturing empire Alpha Group which was founded by his billionaire brother, Cai Dongqing, who was a co-producer of China's all-time highest box office grossing movie The Mermaid.</p>
<p>Tsoi owns an $11.7 million mansion in Vaucluse.</p>
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<p><em>This article first appeared in</em><span> The Sunday Telegraph. </span></p>
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Chinese list Wandin Valley vineyard

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<div class="column">Changing local market and regulatory conditions resulted in a dramatic slowdown in outbound Chinese investment in Australian commercial property during 2017, falling further from its 2015 peak.</div>
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<div class="column">But despite these weaker investment levels, Australia remains a firm favourite among Mainland Chinese investors, ranking second for the third consecutive year behind the United States, the Cushman &amp; Wakefield’s annual investor intentions research noted.</div>
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<div class="column">Australia ranked as the 7th most popular global destination for Chinese CRE investment in 2017</div>
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<div class="column">The investment challenges are driven by supply constraints and regulatory changes.</div>
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<div class="column">The report noted sentiment among Chinese investors towards Australian CRE ranks 2nd globally, although its has decreased from 2016.</div>
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<div class="column">Inbound investment from Hong Kong rises by $200m year-on-year to $1.1Bn with NSW offices accounting for almost 50% of Chinese CRE investment into Australia (excluding development sites).</div>
<div class="column">It reported 73% of deals transacted by Chinese investors during 2017 were in the sub-$50m category.</div>
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<div class="column">Total Chinese outbound investment into Australian commercial property has fallen from $6.97bn in 2016 to $2.83bn in 2017, a 60% decline overall, and ranking as the 7th most popular destination for China investment worldwide. Total 2017 investment comprised $1.97bn invested into standing assets and $853m in developments sites, a decline of 60% and 72% respectively.</div>
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<br>While mainland Chinese investment has decreased, investment from Hong Kong Kong has increased by 20% last year, rising from $918m to $1.1Bn in 2017. This is expected to increase further during 2018 as Mainland Chinese investors seek to reallocate capital via Hong Kong.</div>
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<p><span>A recent survey of top Mainland Chinese Real Estate Investors Overseas (‘MCREIO’) conducted by the Cushman &amp; Wakefield Research team also shows that MCREIO’s sentiment towards Australian commercial property had dropped from 22% in 2016 to 17% in 2017. This was in line with the decrease in overall investment, however it still placed Australia in second position overall - behind the 31% of investors that intend to invest in the United States (also down from 44% in 2016). </span></p>
<p><span>From the survey, the most significant declines in sentiment were experienced in Canada, Singapore and Japan where allocations fell to 1% or less of the available MCREIO global real estate capital as investors backed away from expensive markets and stabilised assets. </span></p>
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<p><span>While there is expected to be greater scrutiny of offshore investment by the Chinese Government, Cushman &amp; Wakefield Research also shows that only 50% of mainland investors have been significantly impacted by the latest guidelines. The remaining half felt limited or no impact. </span></p>
<p><span>Cushman &amp; Wakefield’s Head of Capital Markets Australia and New Zealand, James Quigley, said while there had been a significant drop in China outbound investment into Australian real estate over the past year, Australia remains as one of the top global destinations of choice for Chinese investors. </span></p>
<p><span>“Top Chinese investors are telling us that they still greatly favour the Australian market, but with regulatory changes and fierce competition for top assets, deal activity is expected to weaker. That said, we are seeing rising investment volumes from Hong Kong with further growth expected as Mainland Chinese investors look at alternative avenues to invest. </span></p>
<p><span>“Nonetheless, some investors are likely to be less impacted by recent policy changes, and so are expected to remain active purchasers. As investors change strategies and potentially lower volumes, this also presents near term opportunity for local capital partnering,” Mr Quigley said. </span></p>
<p><span>While Chinese investment into larger Australian assets with sale prices of $200m+ have transacted, they have only accounted for just 4% of deals by number since 2013 (and 37% of dollar value). Conversely, 73% of deals by number have been completed in the sub-$50m range, accounting for 25% of total deal value. </span></p>
<p><span>Outside the development site market, Chinese investors have a sharp focus on the Australian office market, and New South Wales offices in particular, which have averaged 48% and 45% of total investment by value respectively since 2011, and 40% during 2017. </span></p>
<p><span>With many of Sydney’s largest transactions in 2017 undertaken by domestic entities, this is in part contributing to the decline in investment, but also driving greater diversification into other sectors such as retail and mixed use and geographically into metropolitan Sydney and Victoria. </span></p>
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<p>Since 2015, there have been three major policy developments that have impacted Chinese investment into the Australian real estate sector. The China Australia Free Trade Agreement (CHAFTA, the Belt and Road Initiative, and most recently, the updated guidance on foreign investment (Circular 74). While the CHAFTA is designed to make trade more efficient, the Belt and Road and Circular 74 are expected to have broader reaching implications for commercial real estate.</p>
<p><span>According to Cushman &amp; Wakefield research, the expected impact of these policy frameworks will include lower investment volumes and fewer Chinese investors in the market, also driving opportunities for capital </span>partnering and local asset management services.</p>
<p>Realignment of real estate strategies to Belt and Road criteria is likely to benefit the development and industrial sector, especially logistics, production space and R&amp;D sites. Over the longer term, there is an anticipated uplift in demand for space as Chinese occupiers continue to expand into international markets. </p>
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Chinese investment into Australian commercial property falls further from its 2015 peak

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<p>Chinese property investors are choosing Bangkok over Sydney and London, according to UBS.</p>
<p>Chinese buyers of property abroad tend to fade or pick up depending on key factors, UBS head of global real estate Kim Wright said.</p>
<p>“What we have found is that Chinese buying of property abroad tends to be very price and currency-aware,” Wright told The Australian.</p>
<p>“Their focus on specific markets will fade or pick up, depending on their view of currency. Over the last two years we have seen Asian buying of Australian property, specifically Sydney, Melbourne and Brisbane, that’s been very strong. It looks like that has started to fade over the past six months.</p>
<p>“I think it’s the combination of factors. Prices have been very strong in Australia so there is now a discussion that the cycle has started to peak and there’s the tax changes that have come through along with the tax controls.”</p>
<p>Wright suggested the decline in demand for property in Australia among Chinese buyers was similar to a loss of interest in London property in late 2015 when buyers felt the market had peaked, while tax changes and tighter capital controls further put them off.</p>
<p>Wright told the recent UBS Greater China conference in Shanghai that their research suggested tighter capital controls were just one factor.</p>
<p>Half those said the controls had encouraged them to bring forward purchases while the other half said it would slow their buying.</p>
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<div>The UBS research also found that two thirds of property purchases were cash settled.</div>
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<div>Wright suggested that Chinese property investors were now looking to Bangkok, Thailand, as a new market.</div>
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<p>"I am not sure if that's a function of the One Belt One Road initiative and people are seeing the infrastructure spend and the co-operation, but also the price point is pretty attractive."</p>
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<p>The Shanghai conference addressed efforts by Chinese authorities to reduce private sector debt levels and put the economy on a sounder footing without severely impacting growth, or triggering a financial crisis.</p>
<p>"A Minksy moment will not come in China. The debt problem is not going to result in a sudden collapse," said UBS head of Asian economic research Wang Tao.</p>
<p>Dr Wang said data that showed that China's foreign exchange reserves had actually increased was a "pleasant surprise" particularly in the context of fears last year that sustained outflows would deplete reserves and weigh on the currency</p>
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<p>She is forecasting slower economic growth of 6.4 per cent in 2018 and 6.3 per cent in 2019 compared with the 6.8 per cent achieved in 2017.</p>
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Chinese cooling on Australia property sees cash heading to Thailand: UBS

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<div>The Horsham Gateway shopping centre in Victoria’s Wimmera region has been sold to a Chinese investor for $14.55 million. </div>
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<div>The centre located at <a href="https://www.realcommercial.com.au/property-retail-vic-horsham-502568898" target="_blank">120-124 Wilson Street</a>, was sold by a local private developer at Horsham, a regional town halfway between Melbourne and Adelaide.</div>
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<div>The centre is anchored by Target on a new 15 year lease.</div>
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<div>There are six non-discretionary specialty shops, including "a bustling Snap Fitness." </div>
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<div>It was advised has having a fully leased net income of $1,205,000pa.</div>
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<div>The 1.21ha site comprises additional Commercial 2 zoned land that provides scope for future development.</div>
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<div>The $12-million development created more than 250 jobs during its construction phase. Target opened in May 2013.</div>
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<div>The quality of the Target lease covenant remains just as strong as a Woolworths or Coles supermarket, however the rent per square metre is generally substantially less, the CBRE selling agency advised.</div>
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<div>Other recent regional retail transactions include the IGA, Nagambie at $7,800,000 reflecting a 6.11 % yield and Bunnings, Yarrawonga at $11,500,000 reflecting a 4.9% yield.</div>
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