Submitted about 3 years ago by Alan Barry
The announcement last week by Centuria is a prime example of the extraordinary returns that is achieved when a property’s zoning changes to a higher density and more sought after zoning. Here is an extract from the Centuria press release from Wednesday 27th July 2016.
“Centuria Property Funds Limited today announced the settlement for the sale of 80 Waterloo Road and 16 Byfield Street Macquarie Park for $101 million.”
The CEO John McBain goes on to say “ Centuria purchased the properties in 2000 for $24 million.” and “ For investors the Macquarie Park sale represents a five fold return on investment and an Internal Rate of Return of 30%”
Both properties were zoned under a Ryde city council zoning as a business zoning to promote research and development with an FSR of 1:1 the new zoning that came into effect in 2014 changed that to B4 Mixed Business and Residential for 80 Waterloo a maximum 2.49:1 FSR and a maximum height of 29.9 metres. 16 Byfield street on the other hand is zoned B3 commercial core, with an FSR of 2:1 and a maximum height of 34.9 metres.
For a developer this provides the opportunity of generating a huge increase in the value of the combined property.
This extraordinary result is both a function of the demand for residential apartments and A-grade Commercial property in Sydney and is showing no signs of abating in the short term.
If you want to understand the effect on zoning changes affecting your property call Alan Barry 0408 034 211