Please let me preface this by saying that the property we are about to discuss is being sold within the Agency I work for as a sales agent… So I am both selling and looking to possibly purchase this allotment as my first joint endeavor.
That out of the way, here is the story:
The property in question is located close to a primary school, high school, three sets of shopping centers, bus stop at its doorstep, main road frontage.
16,190m2 Zoned Res600. The Owner has been in and out of this office discussing there property. It seems that the local council has decided to build a major park/sports complex/ nature reserve at the rear of the property. Their plan incorporates half of the property.
So far it seems that in order to purchase said property the council has agreed to pay good money (close to CMA) and also grant DA for 25 townhouses on the front of the property… Fantastic!
So far so good… though this is where it is starting to get sticky. As their agent we have been asked to market the property to potential investors (this includes myself). The thing I fear is that if myself, or someone else, purchases said property would the council (no names due to confidentiality) decide to reneg on their original agreement? It is very likely that if they did I would still be able to push for townhouses, it just makes the whole process messy when it was so neat to begin with.
The best thing with the Councils proposal is that they already have plans drawn up for the development! Saving me time and money.
What my major question is is, what kind of costs would I be looking out to complete said development?
At the price the property is listed for 25 townhouses seems viable to me, but I need to know general costs…
By the way, this is in Queensland. No suburb yet due to confidentiality.
Any help would be great… I am typing this at work so I will look over my post this evening to revise details further.
Thanks
Matt
Matt, an interesting question that you pose, however it is a little like asking how long a piece of string is. I may be able to assist, but would have to know what the GFA is for the town houses? Are they low set or double story? Two bedroom or Three bedroom? One bath or two? Lock up garages or carports? Do you want just Building cost or do you want to include landscaping, driveways, fencing etc.
I have not heard of res600, so I am assuming that you are in a regional area at least not BCC. What is the demand for townhouses in your area?
In order to protect yourself or any other Buyer, you would enter negotiations via a contract with a subject to Development Approval satisfactory to the Purchaser clause. I have to warn you here, if this property were in Brisbane the DA could take at least 2 years to obtain. Not sure how fast regional town planners can perform. The fact that the council wants the park area has to be a bonus.
I have a spread sheet that I use to calculate feasability on this type of project. If you wish you can contact me to discuss.
Jon
Res600 is residential 600 (yes I know, obvious). It is described as being allotments from 450m2 to 600m2. Any property with Res600 zoning SHOULD be able to be cut up into 450-600m2 allotments. The great potential with this property is that it is positioned so close to everything. With council pushing the DA for us it should make for a great endeavor…
I will get back to you with details on the type of town houses. They look like 3bedroom two story homes.
I was actually just after building cost at the moment, though I am trying to work out feasibility for myself and other Buyers… I don't like being in competition usually, but this is fun!
Demand for townhouses is high here, we are getting $270,000 for run down homes atm…
I sent you a PM as well.
Thanks for the reply
Matt
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