Park Terrace Gilberton

The former Channel 7 Studios site in the near city suburb of Gilberton has an extensive frontage to Park Terrace and a rear boundary to the River Torrens. Zoned residential, the location and size give it fabulous development potential, although parts of it have up to 8 meters of fill.

It has taken a long time for a project to be started, as the site has been vacant (except for the ducks) since 2007 when Channel 7 relocated to Hindmarsh.

Now it looks like it is finally all happening with demolition of the old buildings under way and said to be finished by the end of June. Apparently there was an approval for 56 dwellings and 9 courtyard blocks which lapsed, and now there is a current approval for 12 blocks.

We'll keep watching the site to see what evolves...

Transforming Walkerville

The vacant Department of Transport buildings in the heart of Walkerville look as though they will finally be transformed into 2 by 10 storey residential apartment and hotel buildings consisting of some 300 apartments and a 100 room boutique hotel.

The site was sold to Victorian developers last year for around $10 million, and it has been reported that they are going to spend $100 million transforming these early 1960's office buildings into modern contemporary style apartments. The site has some great attributes including fantastic views and a position within a very desirable suburb.

It's a pity that the Government didn't sell this site together with the adjoining site fronting to Walkerville Terrace (now a great big hole in the ground - apparently it was sold to different developers who are having financial problems), as car parking could be a real issue in the site's redevelopment.

Then and Now

223 North Terrace Adelaide comprises of 111 apartments in 2 buildings built over the old John Martins carpark. This Buchan Lee project was completed in the last quarter of 2006 and we manage around 45 apartments in the buildings for clients.

We thought it would be interesting to examine the rental growth since completion, so we picked a typical 2 bedroom apartment in the South building as an example. It was first leased on 23 September 2006, and was just rented to its 3rd tenant a couple of weeks ago. The 79 square metre 2 bedroom apartment is rented with a car park and on an unfurnished basis.

It first rented for $375 per week ($247 per square metre per annum) and current rental is $480 per week ($316 per square metre per annum) both for a 12 month lease period. So in a period heading towards 3 and a half years, this is an increase of 28%. Hopefully for the landlord this growth will continue for the next 3 and a half years - a 28% increase over the current rental would be $614 per week!

A work completely progressed

The fitout of Apartment 31/237 Wakefield Street Adelaide has finally been finished. Earlier 'in progress' photos of the apartment can be viewed here and here.

The building itself was completed about 10 years ago, and many of the spaces were sold as empty shells - giving buyers the opportunity to have absolute creative control over apartment interiors. Apartment 31 was purchased as a shell but never completed internally because the original buyer decided to stay permanently in Western Australia and instructed us to sell it for him.

Our good friend Graham at the design and development company Urban Edge took up the challenge, and the result is simply stunning. The 3 bedroom apartment extends over 2 levels and a roof deck, giving it fabulous city and hills views. With well over 200 square metres of space, some of the striking features include:

• Solid spotted gum timber floors and cavity sliding doors
• Full height frameless door jambs
• Integrated Miele appliances in a kitchen of stainless steel and solid american rock maple benchtops with telescopic power outlets and Paco Jaanson d38 mixer taps
• 2 hand made spiral staircases with stainless steel balustrades and Pirelli rubber treads
• Custom made cabinets and floor to ceiling tiling in the bathrooms and ensuite
• Laundry chute from upper bathroom to lower laundry

It is an exceptional apartment with an abundance of natural light and a delightful double height living space balanced with private and large bedroom accommodation in a wonderful iconic building.

Click here if you are interested in purchasing this apartment.

Latte Rates

The Reserve Bank Board has just increased rates from 4% to 4.25% - the 5th rise since October 2009. This means that a standard variable rate mortgage from BankSA from 9 April will carry a rate of 7.18% for existing and new residential loans. The Reserve Bank is concerned about a bubble in the housing market and the possibility of a breakout in inflation.

Treasurer Swan says interest rates are getting back to "normal" and Governor Stevens reckons they are trending towards "average" rates. If this is the a case, then a lot of homeowners would probably prefer "abnormal" or "below average" rates!

We noticed on Tuesday that a latte at our favorite city cafe increased by 20 cents a cup. Shouldn't it have gone down if interest rates have gone up to stifle inflation? Or do they need to set the interest rates even higher? Looking closely at Governor Stevens's press release, it is clear that he thinks interest rates are not yet "average" - perhaps this is a sign that there will be more rates increases in the coming months.

Pool & Gym now open

The amenities area at 20 Hindmarsh Square has just opened for the residents. As we blogged earlier, these facilities aren't actually located in the apartment building but are in the adjoining Crowne Plaza 5 star hotel run by the Intercontinental group. However, they are so easily accessible via a seamless crossover entrance that you can't even tell that you've stepped next door! The Hotel itself looks like it is still a few weeks from completion.

The lap pool and spa look very inviting, and the sauna and steam room are top class. The gymnasium is seriously equipped for those into health, fitness and wellness.

Shrinking Apartments

For the best City and North Adelaide locations, a brand new apartment in our best buildings sells for $7,000 to $8,000 per square metre off-the-plan. That means a 110 square metre 2 bedroom 2 bathroom pad with a carpark is $770,000 to $880,000. This cuts out many younger buyers, even though city living might be more suited to their study/work/play lifestyle than moving out to the "burbs" at their age.

A new generation of studio apartments may be the answer to this growing market. The current crop is aimed at international students. With no on-site carparks, and sized at around 28 square metres, they can be sold off-the-plan for $179,500 or up to $195,000 when completed and fully furnished.

However, international students aren't the only young people who want to live in the city. We think a high quality building with studio, 1 bed and 2 bed apartments sized at 35 to 65 square metres (exclusive of balconies) and marketed at $240,000 to $520,000 would be a sell out.

The key is a powerful location, clever design and great amenities including the usual lap pool, gym, common lounge and roof deck. The studios would have fold down beds and kitchen tables that pull off the wall as well as finishes and fixtures of a high quality.

This would appeal to the "lock and leave" mentality of many younger buyers who are looking for apartments which function as a sleeping place only. The rest of their 'living' occurs elsewhere in the city, which they can easily access without a car because they are in close proximity to their employment and social activities.