Construction revived at troubled South Perth project

Construction has restarted at Devwest’s Richardson Street project in South Perth, after two false starts over seven years that included a commercial dispute with the project’s former funding partners.

Perth development firm Devwest got the green light in 2013 to build an $85 million office and apartment complex at the corner of Richardson Street and Melville Parade in South Perth.

The development, dubbed One Richardson and Richardson Centre, was set to house 70 luxury apartments and 6,000 square metres of office space and a 145 square metre café.

Construction on the project started in 2014, but market conditions brought the development to a grinding halt in 2015, after six months of construction activity.

As Devwest executive director Chad Ferguson told Business News, the project’s reliance on commercial buy-in coupled with a commercial collapse made it unviable at the time.

“The project has a large commercial component and due to that it was almost impossible to obtain finance for it,” he said.

“Vacancy rates went from zero per cent to 20 per cent in a short period.”

In 2018, Devwest settled a long-running commercial dispute with Singaporean funding partner Sincap Group, which required the developer to pay $4.07 million over two years to the Singaporean company.

At the time, Mr Ferguson told Business News Devwest expected to restart construction on the development before the end of 2018. 

The dispute stemmed from a 2015 deal under which a Sincap subsidiary lent $4.7 million to special purpose vehicle Richardson 1 Pty Ltd, which owns a parcel of land at 1 Richardson Street in South Perth.

The site at Richardson Street. 

Primewest-backed Centuria Bass recently stepped in to finance the project, while EMCO were appointed as builders.

National commercial building giant Probuild, who recently entered administration, were initially assigned to build the development. 

Centuria Bass chief executive Nicolas Goh said his company was delighted to be supporting the development.

“It has taken strong leadership to bring this project to life,” he said.

Devwest has obtained 50 per cent pre-sales for its apartments at the site and 20 per cent, or $7 million, of pre-commitment from commercial tenants.

The project is now valued at an estimated $80 million. 

Construction recommenced today and is set to be complete by the second quarter of 2024.