Waterbank timetable slips further

Lend Lease says it is still working towards submitting a development application for the first stage of its long-awaited $1 billion Waterbank project in East Perth; but according to its half-year report, the developer doesn’t expect the project to contribute to its earnings until the 2019 financial year at the earliest.

It has been more than three years since Lend Lease was named as the government’s preferred partner for the Waterbank project and just more than two years since it signed a binding development agreement with the Metropolitan Redevelopment Authority.

The four-hectare Waterbank site is considered to be one of the key developments of the MRA’s $2.6 billion Riverside precinct, which also includes Frasers Property’s Queens Riverside hotel and apartment projects, and an upcoming apartment building at the former chemistry centre on Hay Street.

The MRA said earlier this month that the riverside land earmarked for Waterbank was nearing its final stage of stabilisation, which would clear the way for construction to begin later this year.

A Lend Lease spokesperson said today that the company was working towards submitting a DA for the first stage of Waterbank.

“The residential market in Perth remains stable and the first stage residential release is expected by the end of the calendar year,” the spokesperson said.

In today’s half-year results, in which Lend Lease reported a $315.6 million net profit, Waterbank was estimated to be completed by 2022.

However, the developer’s results presentation showed the project wasn’t expected to contribute to the group’s revenue in either of the 2015, 2016, 2017 or 2018 financial years.

A lack of major construction activity at the Waterbank site in 2014 had led to quiet speculation in the market that the project had possibly been shelved.

In early 2013, Lend Lease told Business News it was aiming to submit the first stage’s DA by the end of that year, with the Waterbank project slated to include a mix of 630 apartments, 20,000 square metres of office space, as well as restaurants, shopping areas and a hotel.

Part of the agreement with the MRA was to deliver the majority of the project’s public space, including a new beach, promenades, wetlands and a connection from Hay Street to the Swan River via a new pier.

But later in 2013, Lend Lease provided Business News with an updated timeline for the project, scheduling first apartment sales for mid-2014 and construction to begin by the fourth quarter of 2014.

While Lend Lease did not release any specific designs with its results today, its property portfolio report showed it had tweaked the configuration of the project to comprise 925 apartments and 17,000sqm of office space, presumably due to difficult leasing conditions in Perth’s commercial market.

An MRA spokesperson said the authority was expecting a DA to be lodged in the first quarter of this year.

The Waterbank project is expected to be a transformative development for East Perth.