According to commercial real estate agency Colliers International, the government’s willingness to invest in infrastructure, particularly public transport, is encouraging the conversion of industrial and commercial sites for residential use.
In particular Colliers nominated North Sydney, which will benefit from the second stage of the Sydney Metro rail project, as an area in the midst of widespread changes.
“North Sydney is on the forefront of this transition, with significant investment activity underscored by the implicit uplift in infrastructure and leasing conditions,” Dan Walker, director in charge of North Sydney for Colliers International said.
“In the last year, over 48,000 square metres was withdrawn from the market. Much of this was for the residential conversion, with over 1,700 units and 57,000 square meters of residential floor space in the current pipeline,” Walker said.
David Kingston, founder of buyer’s agency I Rate Real Estate, said any residential developments that come online in the North Sydney area would likely attract attention from owner occupiers currently priced out of the market.
“I think there are a lot of people who want to buy and live in the areas around Crows Nest and North Sydney, but don’t have the $2 million or so they need for a house so they’ll start looking at apartments instead,” Kingston said.
“They’re willing to sacrifice a bit in terms of having a backyard and that sort of thing so that they’re able to stay on the north shore and be relatively close to the city, rather than have to look towards areas like the central coast,” he said.
While Colliers is predicting a surge of residential projects in North Sydney, Amanda Segers, founder of buyer’s agency Amanda On My Side, said the area isn’t currently an investment hotspot.
“If you look at the residential sites in North Sydney at the moment, a lot of them come with things like a door man. They’re the kinds of places that people who work in the city might have to stay at during the week and then head home on the weekend, they’re not really what investors would target,” Segers said.
“There’s already a range of transport options in North Sydney, so I’m not sure a new project will increase demand that much. It’s well known as a business district, and there’s not a lot in the way of lifestyle attractions, so until that changes it’s not really an extremely desirable place for people to live.”
