Foreign buyers dominate Sydney development sites

Sydney’s CBD.

Two-thirds of the $100 million-plus sales of development land in Sydney were made to offshore buyers or local developers with overseas backing, according to a new analysis by Charter Keck Cramer.

Since 2014, 50 Sydney residential development sites have sold for more than $100 million each, totalling $9.4 billion in what the property advisory deemed the “mega site” phenomenon.

National director Bennett Wulff says of the 33 sites acquired by foreign entities, most were China-based, with additional ­purchases by Japanese or Singaporean interests.

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Wulff says Sydney’s buoyant market conditions are due to increased overseas investor ­activity, low interest rates and state and local government pro-development planning changes.

“Research by Charter indicates that 40 of the 50 mega sites purchased had recently been rezoned and/or granted greater ­development controls,” the analysis says.

Despite the development and building completions, Sydney remained undersupplied, with strong population growth forecasts

“Re-zoning of these mega sites is enabling new residential supply through urban ­renewal and gentrification of ­former industrial, commercial and low density residential locations, or extension to fringe ­suburban areas into previously rural locations.”

Sydney-based developers Romeciti this week announced they had bought a 1ha site on ­Waterloo Rd at Macquarie Park, in the city’s northwest, understood to be for about $100 million.

The Charter Keck Cramer report says Sydney’s booming residential market, up more than 40% in three years, has coincided with record levels of planned infrastructure spending, notably for transport.

Wulff says the ­despite the development and building completions, Sydney remained undersupplied, with strong population growth forecasts.

Over the same period, there were seven $1 million-plus sales in  Melbourne and none in Brisbane.

This article originally appeared on www.theaustralian.com.au/property.