Perth piques east coast interest

Developer and funds manager OpenCorp has predicted Perth’s residential property market to turn around in the next 12 to 24 months, with the Melbourne-based company aiming to increase its portfolio in Western Australia after the recent launch of two projects.

OpenCorp has been active in the Perth market since 2012, with its sole project being a residential land development at Landsdale, which it completed late last year.

This year, OpenCorp launched a new 72-lot subdivision at Hammond Park, where it expects to start construction shortly, as well as a boutique apartment project at Port Coogee, which also is scheduled to begin building within the next six months.

OpenCorp also recently added a new parcel of Hammond Park land to its portfolio, adjacent to its existing landholding.

The Landsdale project gave OpenCorp, which raises funds for acquisition and development through syndication, a strong base of WA investors.

“We’ve found that as a market reaches its peak, astute investors start looking elsewhere, so many of those investors in WA started investing in our east coast projects,” OpenCorp director Matthew Lewinson said.

“But now we are starting to see east coast investors looking to invest on the west coast as well.

“The investment market always has an eye for where the market might be going and want to get involved when they think that there is good value.”

Mr Lewison, who was formerly general manager of Peet’s Queensland division, told Business News he expected a big shift over the next two years in the Perth property market, despite continued negative sentiment.

“We like being involved in Perth; the market, particularly the apartment market is going through a phase of maturing that Brisbane went through five or six years ago and Melbourne and Sydney did probably about 10 years ago,” Mr Lewison said.

“Town centres are starting to be urbanised a little bit more with the upgrading of shops, new restaurants, cafes and that sort of thing, and they are starting to attract younger people who are interested in living in higher density around good quality amenity.”

He said while OpenCorp was not being based in Perth, its level of activity in the market had provided a good perspective on where the city was in its current property cycle.

“We’re not in there every day feeling that the market is flat or getting negative sentiment, we can look more analytically rather than reading the papers every day and hearing somebody’s bad luck story,” Mr Lewison said.

“Obviously 2015 was a bit of a tough year because buyers had a lot of choice and there wasn’t a lot of urgency.

“That’s what we’re starting to see a little bit now, buyers aren’t taking as long to make decisions, but there is a bit of a way to go before buyers get to the point of feeling they need to make a decision on the first day they see a property.

“A lot of the statistics are also starting to point to a real stabilisation of jobs growth, and population growth is starting to turn around and pick up again.

“Those are obviously two very important factors in driving the market.”

Mr Lewison said the next six to nine months would be spent seeking appropriate development sites, either for infill land estates or apartment projects.

“Particularly if we can acquire land and go through the planning process ourselves, we like to have a strong input in the design process,” he said.

“We’re fairly selective about where we develop; not just suburb-wise, but also within a suburb and what the surrounding amenities and views are.

“It does make it a little bit tough, and even though people in Perth may think it’s a buyer’s market, when you start looking at development sites, good sites are still hard to come by and secure at a good price.

“So that obviously makes it a bit tricky but it means we just have to do a little bit more work to secure the sites.”