Perth’s CBD has found itself in the unusual position of being sandwiched between two major infrastructure projects that will increase the city’s footprint to the north and south.
Mining boom revenue and investment, the knock-on effect of a constrained office market and an awareness of inner-city living have converged on the city, setting the scene for an unparalleled period of growth.
On the waterfront, there is the $2.6 billion Elizabeth Quay and on land reclaimed from train lines that once divided the CBD and Northbridge, the $5.3 billion Perth City Link is taking shape.
In between the developments flanking the city, major infill developments are flourishing with a slew of new office towers, hotels and apartment buildings making their way into the market.
“If you think back a few years ago the answer was ‘no’ to many things but the new planning regime is looking at ways to make a better city, ” says Philip Griffiths, president of the WA chapter of the Australian Institute of Architects.
“We now have a planning scheme that allows more intense development but safeguards things we love with incentives for looking after heritage.”
The line-up of market forces behind the enormous level of development happening in the city has been a long time coming and if there is a downside, it’s that it didn’t result in a series of staged projects.
“The government has had, through its various arms, control over when Elizabeth Quay was going to happen and when City Link would happen and perhaps a bit of off-setting of time might have been the smart thing to do, but on the other hand there’s an appetite for doing it and getting it done, so for the moment, we are city circulation victims of our own success, ” Griffiths says.
Private developers, including a growing contingent from Asia, have been quick to take up the new opportunities delivered in master plans signed off by various planning agencies.
Perth’s tallest apartment building is planned for the last of three residential lots being developed by Finbar at the former ABC site on Adelaide Terrace. At the other end of the city, Malaysian developer AAIG stole the march on established operators with a memorandum of understanding to build the new headquarters for Woodside at Capital Square on the long vacant eyesore once occupied by the Emu Brewery.
One of the landmark transformations will be the Treasury precinct. The restoration and conversion of the 135-year old Treasury Building into a hotel, the 33-storey office tower under construction, a new library, a refurbished Public Trustee Building and a new public plaza behind St George’s Cathedral is all part of the master plan.
“It will be one of the city’s shining lights, everything will look right there and it will be in all the tourism brochures, ” Griffiths says.
At Elizabeth Quay, the Far East Consortium will build a Ritz Carlton hotel and 420 apartments. Hilton will build a DoubleTree and energy giant Chevron will build its new office tower. The Metropolitan Redevelopment Authority is weighing up proposals from five bidders to develop two other sites there.
Although Elizabeth Quay is the most contentious of the city projects, most agree that it’s the Perth City Link that will have the most profound change on the CBD.
The 13.5ha strip of land created by the sinking of the railway line opens the way for the CBD to reconnect with Northbridge.
Bookended by Perth Arena and the Horseshoe Bridge, a blend of apartments, office towers, retail space and the new Yagan Square will be built on the land.
“The city is anticipating that expansion northwards and looking at the planning north of Roe Street, ” Griffiths says.
Questions already being asked are, he says, what do we care about, where can there be more future development, what do we need to look after?
At Kings Square, which will occupy 1ha of Perth City Link, Leighton Properties is well into the construction of its seven-building plan, with four office towers due to be finished from the middle of next year and work yet to start on two apartment towers and an additional commercial building.
Developers are also responding to demand for inner-city living and Perth is acquiring a residential population that will underpin the future city.
With more people opting for the convenience a CBD lifestyle offers, Perth is making the transition to become a safer, livelier city.
The City of Perth has also come to the party with density bonuses for developers.
With rising office vacancies likely to be compounded by big tenants relocating to new offices, a big part of the CBD’s development focus has switched to the profitable apartment market.
Buoyed by strong sales of inner-city apartments, developers are packaging competitively priced apartments into high-amenity complexes with pools, gyms and communal entertaining areas.
Another new arrival, Singaporean developer the Fragrance Group, is expected to build an apartment tower on part of the site at 374-396 Murray Street. Registrations of interest have opened for Far East’s apartments at Elizabeth Quay and off-the-plan sales have started at Finbar’s Concerto on Adelaide Terrace. More offshore developers, many backed by private equity and with the financial muscle to develop core CBD apartment sites, are also expected.
JLL managing director for WA John Williams says he is expecting more big deals in the CBD from offshore developers like the Fragrance Group and the Far East Consortium.
“The benefit for the CBD is that they operate on a scale which is outside the reach of the majority of Perth’s developers, ” he says.
“They don’t want to build 50 or 100 apartments, this wave of developers is looking for larger projects.”
Williams says offshore developers have the option to sell apartments to their own domestic market and to Australian buyers.
“The next wave of office development could be beyond 2020 and in the meantime we have offshore developers looking for opportunities and we have forecasts for high population growth, ” he says.
For more information about the major projects being conducted in WA visit getthebiggerpicture.wa.gov.au
© The West Australian