The residential sector accounted for a significant share of the combined development application value recorded in February 2018.
According to the CoreLogic March Construction Monthly Update released recently, residential application value last month amounted to $6.1 billion out of the combined value of development proposals totalling $12.6 billion, representing a month-on-month increase of 64 percent.
Among the new residential projects was a $3.5 billion application for Wilton North Precinct in New South Wales developed by Bradcorp Holdings, encompassing the construction of 5,500 homes with 5,000 square metres of retail in addition to playing fields, open space, local centres and schools.
CoreLogic commercial research analyst Eliza Owen expressed surprise at the high value, large scale residential development applications, given that their indices data indicated a decline in Sydney dwelling values over the year.
She attributed the rebound to the Western Sydney City Deal and the vision from the Greater Sydney Commission, which have developers anticipating long term growth in Sydney’s housing market.
Prime Minister Malcom Turnbull had launched the Western Sydney City Deal last week with council leaders and NSW state premier Gladys Berejiklian.
The Wilton North Precinct development comes under the Wollondilly Shire Council, which in turn is in ‘The Western Parkland City’, as outlined by the Greater Sydney Commission.
The 20-year $20-billion plan for the Western Sydney City Deal includes a new airport at Badgerys Creek, and a North-South rail link, which would link south-west Sydney with St Mary’s station via the airport, all aimed at boosting the economic development of the region, creating new infrastructure and supporting job creation.
City Deals represent an integrated approach that brings all three levels of government as well as the private sector and the community to work together on large scale construction projects, drive economic growth and urban renewal, and help secure the future prosperity of cities and regions.
However, the combined construction value of all new projects captured over February is below the five-year average of $13.6 billion per month and also substantially lower than the $18 billion recorded in January, despite the bullish residential development applications in Sydney, says CoreLogic commercial research analyst Eliza Owen.
CoreLogic also reports that 713 projects moved into the construction stage over February – lower than the five-year average of 1,022 projects per month, but 11.4 percent higher than the number that moved into construction in the previous month.
The construction value of projects that commenced over February increased 20.2 percent on the previous month, to $5.1 billion.