NSW MARKET OVERVIEW
NEW SOUTH WALES
Peter Vines - Managing Director - Ray White Commercial Western Sydney
Recently, there’s been a strong re-bound in market activity & transaction volumes-how are you seeing this play out at ground-level & what has been the prevailing sentiment echoed from key clients. We’ve observed a clear divide in the market, with two distinct groups emerging: those who have the resources to capitalise on current conditions and those who are struggling. Interest rate hikes have significantly impacted the latter, especially those with land not producing any holding income, making it increasingly difficult for them to retain assets. On the other hand, there’s a sector of the market, particularly well-capitalised groups, that has been waiting for value opportunities to emerge. Sentiment remains cautious, largely due to the ongoing threat of further interest rate increases, which continues to create uncertainty and instability. Determining where true value lies is challenging in this environment. However, we’re noticing a growing number of high-net-worth individuals preparing to re-enter the market, often a signal that we may be nearing a market bottom. That said, there’s also a sense that the market could worsen before it improves, with many opting to wait and see how things unfold. With regard to public infrastructure, take us through some of the major projects that will transform your State & the impact you anticipate these projects will have in terms of driving new investment & development. One of the more recent projects was Parramatta Square. This development is one of Australia’s largest A-Grade office projects, adding approximately 200,000sqm of prime space to
Thank-you for the opportunity to share your insights as part of The Property Development Review publication - walk us through the performance of your business from a State perspective this year, in which divisions have you seen the strongest growth in 2024. Our strongest growth this year has been in the land subdivision sector, particularly within the North West and South West Growth Corridors. While our focus has traditionally been on the residential development space, current conditions in Western Sydney have made it increasingly difficult to make these projects feasible. Despite these challenges, we continue to see robust demand, especially for well-sized land offerings. The market’s appetite in these growth corridors remains strong, signalling a shift in where opportunities are most viable. And then in terms of the key thematics driving investment into your State, what have been the key considerations made by sophisticated investors & developers when deciding where & how to allocate their capital from a real estate standpoint. Western Sydney stands out as one of the most dynamic markets in the country and is among the fastest growing. This growth is fueled by several factors: significant population increase, urban sprawl, and the relative lack of affordability in Sydney. Additionally, major infrastructure projects and job creation are pivotal. The evolving nature of Western Sydney bolsters demand across all asset classes, ensuring sustained interest from tenants, future investors, and occupiers alike.
P ETER VINES
28 – August / September 2024
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