2017 03-08--QUEENSLAND CONSTRUCTION REPORT-feb2017

Construction Monthly

www.corelogic.com.au/cordell

DATA FOR FEBRUARY 2017

http://www.corelogic.com.au/cordell

2 | Cordell Monthly Construction Update February 2017

Pipeline - Australia

Civil Engineering Commercial Community Apartments

& Units Industrial Mining

35% 9% 15%

2

9%

8% 4% 28%

12% 10%

3

8%

5% 7

%

2,105 $11.45 billionNumber of Projects Estimated Value

Median Project Value

Civil Engineering $600,000

Commercial $1,000,000

Community $1,000,000

Apartments & Units $1,280,000

Industrial $900,000

Mining $2,000,000

Cordell Monthly Construction Update February 2017 | 3

Pipeline - LocationSheet 1

CiferAPARTMENTS & UNITS

Map based on Longitude (generated) and Latitude (generated). Color shows details about Cifer. Details are shown for Postcode.

Sheet 1Cifer

CIVIL ENGINEERING

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COMMERCIAL


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COMMUNITY

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INDUSTRIAL


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MINING

Map based on Longitude (generated) and Latitude (generated). Color shows details about Cifer. Details are shown for Postcode.Industrial Mining


Moving into construction - Australia

49

% 8%

20%

15%

6

% 2% 31% 11% 19%

1

9%

16

% 4%

884 $3.21 billionNumber of Projects Estimated Value

Median Project Value

Civil Engineering $800,000

Commercial $1,300,000

Community $849,500

Apartments & Units $1,200,000

Industrial $800,000

Mining $3,000,000

Civil Engineering Commercial Community Apartments

& Units Industrial Mining


Moving into construction - LocationSheet 1

CiferAPARTMENTS & UNITS


Sheet 1Cifer

CIVIL ENGINEERING

Map based on Longitude (generated) and Latitude (generated). Color shows details about Cifer. Details are shown for Postcode.Apartments & Units Civil EngineeringSheet 1

CiferCOMMERCIAL


Sheet 1Cifer

COMMUNITY

Map based on Longitude (generated) and Latitude (generated). Color shows details about Cifer. Details are shown for Postcode.Commercial CommunitySheet 1

CiferINDUSTRIAL


Sheet 1Cifer

MINING

Map based on Longitude (generated) and Latitude (generated). Color shows details about Cifer. Details are shown for Postcode.Industrial Mining


New South Wales

Rhetoric and zoning in NSW is shifting to increased diversity in construction and land use. According to ABS trend completion data, NSW has seen 75,000 apartments erected in the last 3 years to September 20161. With a further 2,700 approved in January alone2, the next few years are likely to see a focus on creating services that will accommodate high density residential areas.

In February, there were 9 sites across NSW that were re-zoned to ‘mixed-use’ development, 6 of which were in Wyong on the Central Coast. These zones allow increased flexibility – developers can utilise these sites to establish residential, commercial, retail and mixed developments.

In the industrial space, work has commenced on a $41 million expansion of the Shentone Cotton Seed processing plant near Wee Waa. The project is being led by Richard Crookes Constructions, and is Narrabri Shire’s largest ever non-mining project.

GPT Group has acquired the Salvation Army site in Parramatta which was put on the market last year. The $31.2 million acquisition has potential for redevelopment into a commercial building with 28,037 square metres of office space.

Urban Growth has invited expressions of interest for a highly qualified architectural and urban design team to prepare a spatial masterplan for the Bays Market District at Pyrmont and Glebe. The masterplan will cover some 9 hectares including the current Fish Market site and integration of a new market at the head of Blackwattle Bay.

A prominent site listed for sale by JLL and Colliers is 59 Goulburn St. The site, which is one of many towering commercial buildings in the Sydney CBD, has stage 1 approval for re-development into a 29,489 square metre, mixed-used residential, hotel and retail space.

A further prestigious site on the market is 67-77 Epsom Rd in Rosebery which is being offloaded by Toplace. The site has development approval in place for 268 units, 49 serviced apartments and retail space.

Australian Capital TerritoryA consortium led by Canberra developer Geocon has won the contract to develop the ‘Kingston Arts Precinct’, a redevelopment that will turn a site near the Canberra Glassworks into a major arts hub. Geocon will partner with Fender Katsalidis Architects and Oculus on the site. The development masterplan includes 150 units, car parking, retail and commercial spaces. The territory plan was recently amended to include a hotel and a child care centre.

In addition, Geocon has also partnered with Fender Katsalidis and Oculus to redevelop the old NRMA site on Northbourne Avenue. The redevelopment plan is for a hotel and apartment project known as ‘Midnight’. It will comprise a 183 room Abode hotel, 2,508 apartments and commercial tenancies.

Victoria

According to the Economist Intelligence Unit, Melbourne is one of the world’s most liveable cities3. It is no surprise then that Victoria enjoyed the highest level of net-interstate migration in the June 2016 quarter, and many are flocking to Melbourne due to good facilities, lifestyle, a relatively strong jobs market and relative housing affordability to Sydney.

While unit projects dominated construction in January, February saw $180 million worth of community projects move into construction, out of a total $500 million.

Such works include the first vertical high school in Victoria. The $42 million Richmond High School will eventually cater for around 600 students from Year 7 to Year 12. The project will be built across two sites and be four stories high. This school is just one of the 42 new Government Schools in Victoria following funding of $1.8 billion for new schools and upgrades across the state. The high density nature of the school reflects the increased density of the neighbourhood, accommodating more young families.

Transport upgrades have also been vital in servicing a growing population. Work commenced in February for

1 ABS Catalogue Number 8752.0 – Table 38; Derived by taking houses from ‘total type of building’ from all sectors in NSW Completions. 2 ABS Catalogue Number 8731, Table 1 – Total number of dwelling units; dwellings excluding houses; total sectors (trend data).3 http://www.abc.net.au/news/2016-08-18/melbourne-ranked-worlds-most-liveable-city-for-sixth-year/7761642


preparation for the Cranbourne-Pakenham Line for 65 new high capacity metro trains.

$660 million worth of upgrades will be carried out on the line, including entry to the Metro Tunnel, and longer platforms across 18 stations. Overhead power lines will be built across 70 kilometres, and 20 sub-stations are to be built or upgraded in the project. A new depot will be constructed in Pakenham East that will include a maintenance facility.

The North East Link Authority has been appointed as project manager for additional road links throughout Victoria. The head and CEO of this new authority is Duncan Elliott who has previously worked at the RACV. The project aims at connecting the Metropolitan Ring Road at Greensborough with the Eastern Freeway and EastLink. Currently the business case and route selection are in progress with tenders not expected to be called until 2018.

Four companies have been shortlisted this month for the Thompsons Road upgrade. BMD, CPB, Cut and Fill and Winslow have all been given the opportunity to submit a tender for the $175 million upgrade. Construction is expected to commence before the end of the year. The contract is expected to be awarded mid-2017.

Queensland

Diversification into renewable energy seems to be increasing across Australia. Energy Australia has signed a 13-year power purchase agreement contract for the $225 million, 135 megawatt Ross River Solar Farm near Townsville. It is the largest agreement of this type to date in Australia. The solar farm will be developed by renewable power company Esco Pacific, and private equity company Palisade Investment Partners. The landmark project will generate enough electricity to power 65,000 homes.

Construction is underway on Australia’s tallest, engineered timber building. The Lendlease project, known as the ‘5 King building’, is located at the Brisbane Showgrounds at Bowen Hills. The building was designed by Bates Smart to have outstanding green credentials. Designers are targeting a 6 Star Green Star rating (Design and As Built v1.1) and a NABERS 5 star energy rating.

GA Group Australia has commenced a redevelopment of the Rydges Tradewinds hotel in Cairns. The $100 million redevelopment includes a new, 12 storey tower, as well as renovation of the existing building. The tower will feature an island bar and reflection ponds on the ground floor, and the building will have a façade of sky gardens that showcases the reef and rainforest design theme. The existing recreation area will be renovated to include a new pool, mini beach, relaxation pods and spa.

Further to last month’s report, three companies have now been invited to tender for managing contractor of the $250 million North Queensland Stadium: CPB

Contractors, Watpac and Lendlease. The contract is expected to be awarded by early April and commence in the second half of 2017.

The contract for the $160 million Warrego Highway Toowoomba to Oakey Duplication Stage 2 project has been awarded to the Georgiou Group. The project is expected to take about 15 months to complete, and will see road upgrades, in addition to two east bound lanes added to the north of the highway. The project will increase safety and over-taking opportunity for large vehicles. The project is jointly funded by the federal and state government, with the federal government funding 80% and the state government the remaining 20%.

Early works are underway by Burke Industries for the new $70 million Roma Hospital. The project involves demolition of the old nurse’s quarters, former pathology building and the hospital swimming pool. Tenders for a main contractor to commence the project are expected to be called in July, with work expected to start in October 2017.

Tasmania

February saw 40 projects moving into construction in Tasmania. Most of these projects were in civil engineering and focused on road and waterway upgrades. However, the pipeline reflected more projects geared toward urban and community redevelopment.

On the northern coast of Tasmania, the Burnie City Council have worked with engineering firm GHD Pty Ltd to create the Burnie City Centre Masterplan. The $25 million proposal includes 7 precincts. This redeveloped hotels and constructing mixed used developments. Redevelopment of the Woolworths complex and refurbishment of existing arcades is planned to create a more active retail area. A new facility for the Burnie Museum and a high tech industry park is also proposed at the southern end of Burnie which will bring high exposure from the Bass Highway.

The redevelopment of the coastal city takes advantage of a surge in tourism to the island.

South Australia

Kangaroo Island has a number of large construction proposals currently in the pipeline:

� The Airport is about to commence airside works which will include runway extensions (including pavement strengthening and overlay), taxiway relocation, navigational aids and adjustment to current refuelling facilities. The landside works are currently out to tender and will include a new terminal, site services, infrastructure modifications and other aviation specific works.


� A tourist resort at American River has recently received development authorisation approval. The resort will include a hotel, 10 lodges, 20 cabins and 20 cottages. There will also be a conference centre, restaurants, bar, spa and swimming pool, as well as other outdoor activities.

� A proposed multi-purpose/multi-user deep water wharf development has also been proposed on Kangaroo Island. The wharf is to be at Smith Bay, on the north coast of the island, approximately 18 kilometres north-west of Kingscote. The proposed construction is of a hardstand causeway extending approximately 200 metres into the sea, to a floating pontoon berth.

The revitalization of Port Adelaide is continuing with the construction of a new office building in Nile Street which will house more than 500 public servants. The building on the corner of Nile and Robe Streets will provide an economic boost to local businesses, creating jobs for local workers and public servants. The building will achieve a minimum 5 Star Green Star and NABERS design rating.

Built Environs have been awarded the contract to build stage 1 of West Franklin mixed use building, comprising two towers over a combined podium. The $90 million project will commence in April of this year and will include a supermarket, café and specialty shops on ground floor with apartments above. The building is to be constructed on the former Balfours site with plans for a stage 2 residential tower in 2019/2020.

Northern Territory

February saw 36 projects in the Northern Territory move into construction, with a value of approximately $48 million. While this construction activity is below the 5 year average, it is a rebound on the previous three months, which saw relatively subdued activity.

The highest value project moving into construction over February was the provision of uninterruptable power supplies (UPS) to the Northern Gas Pipeline project throughout the Northern Territory. The $10 million project is being developed by Jemena Ltd, with completion expected in September this year.

The federal minister for infrastructure and transport, Darren Chester, announced essential upgrades to remote airstrips across Australia in February. The upgrades include $11.8 million in Commonwealth funding for 91 access and safety upgrade projects, to ensure people living in remote areas of Australia had improved access to services, such as the Royal Flying Doctor Service. In the Northern Territory, 16 aerodromes have been selected for the funding allocation, totalling up to $3.2 million4.

The Northern Territory and federal government are undertaking a program to increase housing supply in remote indigenous communities in the Northern Territory. Nearly 10 years after the partnership project was established in 2008, tenders are expected to be released shortly for the delivery of several construction initiatives under the National Partnership Agreement on Remote Housing initiative.

Western Australia

Since the decline of the mining boom, construction in WA has largely been dominated by community projects, with health investment a large component of this, and civil engineering projects.

The $550 million South Inland Health Initiative from the Western Australia government began to take shape in February, with four contracts being awarded for building works at hospitals.

Devlyn Constructions will be refurbishing the Boddington and Goomalling health facilities. Firm Constructions have been awarded the contract for the Kununoppin and Wyalkatchem-Koorda health services. The upgrades should be completed by the end of 2017.

Iredale Pederson Hook Architects completed design work for the Cunderdin Health Centre in February. The project will see construction of a new emergency department with state of the art equipment. The location of the new Health Centre will be in proximity to planned disabled and aged patient housing. Construction is due to commence mid 2017 with completion expected by September 2018.

4 http://minister.infrastructure.gov.au/chester/releases/2017/febråuary/dc021_2017.aspx


The dominant project moving into construction in February was actually industrial. Construction of the $300 million lithium hydroxide processing plant began in Kwinana. The project involves construction of the plant, an office and administration building, a laboratory and security building and more. It is expected the plant will produce 24,000 tonnes of lithium hydroxide annually.

Mining

A total of 15 mining projects moved into construction across the quarter, valued at $120 million. The first quarter of 2017 will likely see an uplift on the December 2016 quarter, which had just 32 mining projects move into construction across Australia. So far Cordell has captured 42 projects moving into construction in Q1 2017.

A new assessment process has been announced by the Victorian Government this month. The gold mine proposal for Big Hill was rejected by the Victorian Government in 2014 amid health and environmental concerns. The new process will ensure that if Stawell Gold Mines Pty Ltd submit a new plan, the State Mining Regulator will establish a panel to hold information sessions, receive submissions and hold public hearings and recommendation towards any proposal. Information about the new assessment process can be found at www.earthresources.vic.gov.au/earth-resources-regulation.

MMG Limited has entered into an agreement with Century Mine Rehabilitation Project Pty Ltd - a subsidiary of Century Bull Pty Ltd to transfer the former Century Zinc Mine in North West Queensland. Century will begin work completing a bankable feasibility study into zinc tailings re-processing while leveraging the existing infrastructure.

Data Disclaimer

In compiling this publication, RP Data Pty Ltd trading as CoreLogic has relied upon information supplied by a number of external sources. CoreLogic does not warrant its accuracy or completeness and to the full extent allowed by law excludes liability in contract, tort or otherwise, for any loss or damage sustained by subscribers, or by any other person or body corporate arising from or in connection with the supply or use of the whole or any part of the information in this publication through any cause whatsoever and limits any liability it may have to the amount paid to CoreLogic for the supply of such information.

Aggregate value estimates and median project values are based on raw data from the Cordell Connect database. Data from Cordell Connect includes project values as advised by the project managers, or are estimates provided by Cordell researchers.

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2017 03-08--QUEENSLAND CONSTRUCTION REPORT-feb2017

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