Despite the ongoing speculation about the viability of Perth’s apartment market, growth is being maintained in the luxury apartment sector as new products hit the market.
Despite the ongoing speculation about the viability of Perth’s apartment market, growth is being maintained in the luxury apartment sector as new products hit the market.
One development in the market is Cygne on Mounts Bay Road, where four of 14 apartments have pre-sold, including a $3.5 million penthouse.
Cygne, completion of which is expected by late next year, features views guaranteed ‘never to be built out’.
Prices start at $2 million.
Husband and wife team Lance Chu and Chenghan Tan are confident their boutique development company, SC Land, is providing a product that will reflect the maturity and evolution of the apartment market.
“The luxury apartment market is very strong in terms of sales volume and prices achieved,” Mr Chu said.
“The main driver is quality and it is an owner-occupier driven market, not an investor market.”
Mr Chu, who has a masters degree in architecture from Harvard, said design was an increasingly important component of apartment developments.
“Developers and builders need to acquire designers as part of their arsenal to help win buyers over,” he said. “In the eastern States it has been proven that architectural design adds value to projects, and we want to do the same in Perth.”
Mr Chu collaborated with Western Australian architect McDonald Jones on the design of the apartments and said the focus was on light, open living spaces, big balconies and quality finishes.
“We want to create a beautiful product that is also liveable and functional that we can be proud of – our agenda is design and quality,” Mr Chu said.
“Design is so important and can really have an effect on people.
“There are several examples around the world of the power of great architecture, and it only takes one great building to challenge things.
“The architecture in Perth is very conservative, but the seeds of change are already there – it will take years, not decades, before change becomes obvious.”
The riverfront Cygne site was acquired for $6.25 million and is the couple’s second project in Perth after the Aurora apartment complex in East Perth.
Mr Chu said while SC Land was actively looking for new sites, blue-chip sites were hard to come by.
Pro Property principal John Langdon said luxury apartments represented the less volatile end of the market.
“The luxury apartment market is generally owner occupiers and is therefore less volatile,” Mr Langdon told WA Business News.
“It is quite a fickle market, but quality developments that are thought out and deliver what the market wants will always do well.
“Critical to the success of luxury apartments are views, useable indoor and outdoor living areas, location and quality finishes.
“As Perth becomes more cosmopolitan there has been a gradual shift of mindset about apartment living.
“The Perth market is still five to seven years behind Sydney, and we have less apartments in total than there are unsold apartments in Sydney.
“The supply in Perth is 1,000 to 1,200 per year, and considering the growing population there is no oversupply.”
Mirvac Fini’s Peninsula in Burswood is another development to report strong interest at the upper end of the market. Five penthouse apartments have been recently released, with three already sold for $2.5 million each.
Mirvac Fini sales and marketing director Peter Gianoli said the market for luxury apartments was decidedly different, with buyers taking a longer-term view in relation to yields and capital gain.
“It is a definite phenomenon, and it is principally the empty nester market fuelling the demand – they have disposable income, want to leave their big houses, and they like the lock up and leave component,” Mr Gianoli said.
