This article is from the Australian Property Journal archive
MALAYSIAN-backed Phileo has scored a massive windfall from the sale of a 363-hectare Wyndham site in south-west Melbourne for a record figure of $400 million to China’s third largest developer Country Garden.
The price tag for Lots 1-5 Black Forest Road in Mambourin is a staggering 2,658% increase on the $14.5 million Phileo paid for the cattle grazing property in 2004.
It tops Dahua Group’s $360 million purchase of three sites in Point Cook last December, and reflects the skyrocketing values of urban fringe land in the past 18 months, let alone throughout Phileo’s ownership.
Early last year the site’s book value jumped from around $45.4 million to $120 million after Victorian Planning Minister Richard Wynne approved the Black Forest North Precinct, effectively rezoning the site from rural to residential – a figure this transaction has trumped by 233.33%.
It is believed the land can support up to 5,000 dwellings and 25,000 residents, and is set to extend Melbourne’s metropolitan boundary through Wyndham.
Hong Kong-listed Country Garden, based in China’s Guangdong province, will place the asset in its purpose-built Country Garden Mambourin Pty Ltd vehicle.
The deal remains conditional until receiving Foreign Investment Review Board approval.
Danny Clark and Michael Hede of Knight Frank, Rudy Kelemen of Kelemen Real Estate, RPM Real Estate Group and Deloitte Real Estate were appointed to sell the site in May on behalf of Phileo.
The transaction would be paid over four and a half years for final settlement to occur in February 2022.
Phileo is the latest vendor to capitalise on residential development sites on Melbourne’s metropolitan fringe.
Late last year a private family sold off their 115-hectare Wyndham Vale sheep farm to Singapore’s Frasers Property for $95 million, which the group plans to use for a $440 million mixed-use community with 1,200 residential lots and more than 20,000sqm of retail space.
In nearby Tarneit, private developer Central Equity acquired a 184-hectare site on Sayers Road for $180 million, following its purchase of an initial 105 hectares last year for $98 million.
The past 12 months has also seen Chinese developer New Sky Group acquire another Tarneit site, of 64 hectares, for $60 million, whilst a 103-hectare farm just a few kilometres away in Point Cook sold for circa $100 million.
In the northern suburbs, Stockland picked up a 77-hectare site at 1780 Mickleham Rd in Craigieburn, adjacent its $2 billion Highlands community, from the Cicerale family for $75 million, and Satterley Group’s Nigel Satterley acquired a 68-hectare Donnybrook site for $34 million.
In a market update in March, Country Garden said it was ranked in the top three among China’s 10 property developers in terms of sales and has 728 projects either completed or in the process of being completed as of the end of 2016.
Of those, 722 are located in China and nearly two thirds of them located outside of Guangdong, and four in Malaysia, one in Australia and one in Indonesia.
It posted a 120% increase in sales over 2016, defying the pessimistic outlook in the housing market. Contracted sales totalled 308.84 billion yuan, covering 37.47 million sqm, an increase of 74% on the previous year.
Revenue was up 35% year-on-year to 153.1 billion yuan (US$22.2 billion), and net profit attributable to shareholders increased by 24% to 11.5 billion yuan (US$1.67 billion).
Country Garden entered the Australian market in February, 2014 with the acquisition of 17,580 sqm site at 27-37 Delhi Road in Sydney’s north-western suburb of North Ryde for $73 million.
It awarded Watpac the $264 million contract to build the 830-unit project, which will comprise three towers of 27, 23 and 13 storeys and include around 1,100 sqm of commercial space.
Australian Property Journal
