Join Australia's most dynamic and respected property investment community

Deciding what to do

Discussion in 'Development' started by Tonibell, 1st Mar, 2016.

  1. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    We have finished up with a LMR2 site in Wynnum, Brisbane that we need to do something with.
    Starting right at square one with this and would appreciate your thoughts on how we can proceed.

    The property we now have is :

    a) 405m2 LMR block with a duplex on it (no heritage overlay)- currently both leased out.

    b) 810m2 double block - empty land (behind us) and small heritage overlay house on other.

    Blocks are flat and only 200m from the foreshore.

    Rest of street is heritage overlay - except our neighbour behind the block with the house on it.

    Before buying the double block we got a town planner report that indicated no problems with a 2 storey development (within code) or possible 3 storey (council application).

    The things we have to consider now are :

    1) Try to buy neighbour to get a nice square block (may not even be possible).

    2) Try to get permission to demolish the small heritage overlay house (or turn it in to units).

    3) Demolish or retain the existing duplex (also possible to raise and put two units underneath).

    4) Two storey under code or application for three storey.

    5) When and what to sell (to manage the risk exposure).

    Of course a clear plan before purchasing the sites would have been better - but we acted quickly on an opportunity. Selling each of the blocks off would also produce a small profit.

    Who do we talk with to make a decision on how to maximize the site ?

    The town planner can tell us the build space and height under different scenarios but then recommends and architect to design what could then be built within that space.

    It seems that only then can we do the feasibility - which is what we need to examine the options.

    Simplest it to keep house and duplex but make them part of the development and then build whatever units we can in the available remaining land.

    Any thoughts or input would be appreciated.
     
    RetireRich101 likes this.
  2. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,294
    Location:
    Sydney
    congrats on the recent purchase. I remembered you telling about the duplex. is the 810m2 double block also LMR? are the 405 adjacent to the 810(like a battle axe type)?
     
    Tonibell likes this.
  3. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,723
    Location:
    Sydney
    I would be looking at the immediate area to see what stock is in most demand and sells the best, then be looking to see how close to that scenario can I fashion my development project with the block I have and then draw up a preliminary feasibility around that model to see what the numbers look like and your position to finance it. Then go from there.

    Just my opinion.
     
    Tonibell and York like this.
  4. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    Hi RR, yes it combines to one parcel of land with two street frontages. It is all LMR and would the only developable block in either street. Everything else has the heritage overlay.
     
  5. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,294
    Location:
    Sydney
    like this?
    upload_2016-3-1_15-59-30.png
     
    Tonibell likes this.
  6. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    It is definitely a unit development - quite a bit of the happening in Wynnum.

    The question is really about how hard to push it and who can help with that decision.

    The easiest thing is to just do a two story development on land already vacant - but I suspect that is missing out on a lot of the value.

    I had a look at the website of @Be Developer but I am not sure if this is the type of thing they assist with (ie when the land has already been acquired).
     
    Colpio79 likes this.
  7. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    @RetireRich101 - exactly like that (except that the black box is on the right hand side).
     
  8. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,723
    Location:
    Sydney
    I would engage thoroughly with a good town planner to see your options for the site and what is most likely to get approved or if going for something outside the code then what are your chances/timeframe to get it approved. Then work out a feasibility based on the various options and determine what it best for you and most feasible to finance. It might be even selling with a DA or some variation.

    If you haven't had a serious meeting with a town planner yet then that's where I would be heading.

    How hard to push with the decision (I assume you mean pulling the trigger and going ahead) imo it would depend on 3 things:

    1. My financial capacity to go ahead.
    2. Contemplate the risks
    3. What the preliminary feasibility indicates.
     
    Last edited: 1st Mar, 2016
    Bran and Tonibell like this.
  9. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,294
    Location:
    Sydney
    I own the 405 on the left hand side, now I am listening to your offers :p

    just kidding..

    I had a look at LMR lots about 18-24 months in Manly/Wynnum West. I was attracted to the end product (new build) that is freestanding on a 400m2 and architecturally build sell for a premium, as compared to inner Brisbane builds.

    I think 810m2 alone would be good for 4-5 pack, maybe 6 if you're allowed 3 levels. Does it have views to the sea if you go up?

    I assume its a 16m2 frontage? Are you considering the option to replicate a duplex build on 810 double block, so you have 4 x plexes, all street facing
     
    Tonibell and Leo2413 like this.
  10. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    @RetireRich101 - it will be an interesting discussion with the neighbour as they have the choice to sell or to be surround by flats. Not even sure that we are in a position to buy - but we would sell something else to get it (looking to expand your NSM portfolio ?).

    The 810m2 does have the pre-1946 house but we were told this could be converted to 2 flats. Other than that the estimate was 6 - 8 (we avoid the rear set back due to our other block).

    The idea of the purchase was to get approval for something that would not be possible except for our existing block. Anyone could do the duplex so it probably doesn't add value for us.
     
  11. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    The push was about going a non-code development.

    I don't think we would do the development - just sell the site with the approvals.

    We have already had our building dramas with granny flats - so not that interested in going back.
     
    RetireRich101 likes this.
  12. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,723
    Location:
    Sydney
    What does the town planner think about the non-code route?
     
  13. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,294
    Location:
    Sydney
    For the 810m2, I think you're allowed 365m2 on ground and 365m2 for 1st floor for LMR2 (based on 45%), so that is 730m2..
    if 90m2 build, then 8 units ( mix of 1 and 2 bedders?)
    if 100m2 build, then 7.3 units
    if 120m2 build, then 6 units (mix of 2 and 3 bedders)?

    then setback, open and car space comes in the picture. storm water shouldn't be an issue as you strategically own the back regardless its slopping/contour.

    be interesting to see how this unfolds, whatever route you take.
     
  14. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,294
    Location:
    Sydney
    NSM is a keeper for now as good yield, though I will be listing one in Penrith this year. I am all done with Brisbane purchase. If any activity up that way, it will probably smaller builds there granny flats, plexes on existing purchase.
     
  15. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    @RetireRich101 @Leo2413

    Town Planner says for the 1215m2 block we can build 547m2 (45%) on each of the two levels.

    From this we have to deduct the buildings that remain (house 80m2 and duplex 192m2).

    This would leave 550m2 (275 x 2) which is where the 6 - 8 units come from - apparently Brisbane doesn't have density ratios - so you cram on what you can.

    The third level would have larger set backs - so it might be only 130 m2 if we proceeded with that.

    We could also lift the duplex and get a further 2 units under it and also renovate the house - or demolish the duplex.

    Anyway, a bit more discussion with the town planner and then off to an architect for some designs..
     
  16. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,723
    Location:
    Sydney
    Looking forward to watching this project unfold. Great stuff.
     
  17. Be Developer

    Be Developer Property Developer Business Member

    Joined:
    19th Jun, 2015
    Posts:
    1,078
    Location:
    Australia
    @Tonibell

    Happy to discuss and provide you assistant..

    Shoot us an email with site details (if you prefer) and we can look in to it.

    At times, it is not what you can do with block, it is what gets you at end result is MOST important.

    If you havent already, have chat with PRO Townplanner.

    Darryl and his team has lot of experience in related area.
     
  18. Leo2413

    Leo2413 Well-Known Member Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    5,723
    Location:
    Sydney
    Yep. +1.
     
  19. Tonibell

    Tonibell Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    392
    Location:
    Sydney
    Brett from PRO Townplanner did an initial assessment for us before we made the purchase.

    The next step through his process is to work in with an architect and is putting forward a proposal for that.

    The question about what is the best end result is what we don't have an answer to yet and I agree it is the thing most important to us.

    I'll drop you a note.
     
  20. Be Developer

    Be Developer Property Developer Business Member

    Joined:
    19th Jun, 2015
    Posts:
    1,078
    Location:
    Australia
    Happy to help you with that.

    If it is only a quick research, needless to say no cost.

    If it is extensive work, our office will give you a fee proposal.