VIC Glen Waverley - 1538sqm for $6mill

Has it settled yet? Can't see that it has...

 

In Melbourne having an understanding of zoning and rezoning is important.
this is an example of rezoning which has boost the price up by 1million. I checked the dept of planning and it still shows GRZ (General Residential Zone) which has height restrictions.




But looking at the council site. it has been rezoned (or in process of it) - GRZ4.General Residential Growth zone. What was maybe 10 townhouses is now open to 4 storeys and maybe 35-50 apartments. And being so close to the shopping strip and train station is another plus +. If they can do 40 apartments at 500K each (making 20 mil) in the scheme of things 6 million for those rich developers is not that much (being in the no.1 &2 suburb for growth last year and the no.1 or 2 favourite Chinese suburb in melbourne)

• Reducing the front setback from 7.6 metres to 5 metres

• Requiring the planting of 3 canopy trees in new multi unit development (Note: Does not apply to single dwellings.)

• Limiting the maximum building height to 13.5 metres (3-4 storeys)

• Increasing the rear setback from 1 metre to 5 metres with larger setbacks for upper levels (Note: Walls can still be constructed on a boundary.)

• Reducing the private open space requirement for a dwelling from 75m2 to 40m2

• Increasing the minimum width of a balcony from 1.6 metres to 2 metres

• Increasing the minimum area of a balcony from 8m2 to 10m2.

 

Chinese developers certainly have deep deep pockets - I know in Sydney the premium Chinese suburbs certainly have a lot of heat on them from developers still - looks like Melbourne is the same

 

Money doesn't buy you common sense or investor sense!!

That being said, you can't be a total fool and get deep pockets, unless it was inheritance or luck

 

Totally agree - although what you may find with Chinese firms is that they start up focused on one industry and sector e.g. manufacturing - and as they move up the maturity curve diversify into other areas

E.g. one of the biggest firms in China - Poly Group started out as a defense manufacturer and is now one of the largest property developers

obviously majority of firms not of the scale of Poly but they operate as a conglomerate (imo similar operating model to Berkshire) whereby they pour money into the subsidiary where the most return on investment is perceived to be (just happens its in property atm)

so majority of Chinese developers are just subsidiaries to other larger firms with deep deep DEEP pockets

side note: Poly trying to obtain construction funding for this site purchased in feb as we speak ...

State-owned Chinese mega-developer Poly Group debuts in St Leonards

 

I think one thing that's often not given enough focus is the competence of a lot of the foreign developers.

In many cases they bring in not just cash but a lot of experience and efficiencies and often jolt the locals into lifting their game, in Perth we've got some major new towers going up being developed by Singaporean, Malaysian, HK and mainland Chinese developers and in many cases the standard of design etc is higher than existing average new development

 

They also bring a different and sometimes smarter way of getting things done. Look at Finbar, Perths largest apartment developer by far and ASX top 500 company I believe.

Well and truly a Perth company but was started (and they're still very active) by Singaporeans who had moved to Perth.

They have by far the smartest model and most resilient but one that is hard for local Aussie companies to replicate (not impossible) just due to different cultural approaches.

They run super lean and only do what they do, everything non core is contracted out including architecture, building, sales, etc.
In many cases the project is done via a JV with landowner who brings across an unencumbered lot, Finbar does the work, charges a management fee and profits are shared. Happy to be corrected but I believe in many cases the syndicate that buys the land for the JV are people well known to them who have been doing the same and rolling them in year after year.

They only use one builder who also only builds for them and from what I've heard it's astonishing how low the margin in. In return builder is guaranteed work, has no need for sales and large estimating team, no need to allow for chasing people for money etc.
Architect is boring as hell but efficient, again I believe only works for them or vast majority of work and I wouldn't be surprised if Finbar or some of the key folk have a stake in the firm and vice versa.

So basically even in the worst of the market or when banks are refusing to lend, they often are fine as they are bringing in unencumbered land, can build cheaper than anyone, have great track record and their team is so in tune they can estimate much more accurately.

In the meantime, our only other perth home grown apartment developer of note from past, fini, got bought out by mirvac and ruined.

So as much as often we look at Chinese developers and just consider their endless pools of cash, I think they're not given enough credit

 

$3,901 per m2
Is this the top $ per m2 ??? residential price paid by someone on PC ???

 

That is what I am saying when ppl say Chinese the first thought is mainland china and restrictions while there are many many more ethnic Chinese and other Asians from elsewhere like indonesia, Malaysia, Singapore, Taiwan, Korean etc. and also the Indians.

 

Indians typically aren't very entrepreneurial on the whole, that is changing a little bit traditionally were a lot more conservative and scared of taking risks, Imo the Chinese be it from SEA or HK or Vietnam are a lot more willing to put their ahems on the line and sink or swim. There's a lot to admire in that.

Imagine ourselves in their shoes, how many people here could imagine suddenly ending up in a different party of the world, way before the internet, not knowing the language or the ways of this new land and within months or a year saying bugger it, I'm gonna be my own boss.

Brilliant, a lot to admire