Belconnen town centre land sells for $22.1 million to Canberra developers Geocon

A huge block of land in the Belconnen town centre has sold for $22.1 million to the developers of Canberra’s tallest residential tower.

The sales price set at the auction smashed market expectations for the site after competitive bidding for the 16,314-square-metre block of land.

Prominent Canberra developers bid strongly for the land in what is understood to be a sign of confidence in an arguably oversupplied Belconnen market.

It follows the sale this month of Westfield Belconnen’s two blocks of land for $13.15 million.

Colliers International ACT general manager of residential land Shane Radnell confirmed the land had been sold to a local developer new to the Belconnen market.

Westfield, now called Scentre Group, had already had development applications approved in 2012 for the construction of 24, 16 and 12-storey towers on blocks next to the retail complex along Emu Bank.

These approved projects must now be completed by the new owner of the blocks by 2021 under a Project Delivery Agreement signed with the ACT government.

The agreement was signed as part of the Belconnen Town Centre Revitalisation Project in 2007.

The sites will add a potential 1064 dwellings to the town centre in the next decade.

The land next to the Belconnen Labor Club, which was auctioned at the Belconnen Arts Centre on Wednesday, will be redeveloped in stages to a maximum of 745 dwellings.

It must also include 300 car parks leased back to the Labor Club to replace those on the site and a minimum of 2900 square metres of commercial development.

Canberra developer Geocon was the successful bidder for the large car park bordered by Cameron Avenue, Emu Bank, Eastern Valley Way and the club.

The company is constructing the tallest residential tower in the ACT across the road from the site.

Geocon managing director Nick Georgalis said the company had had eyes on the block since it appeared in the ACT government’s Indicative Land Release Program in the territory budget a few years ago.

He said following the success of the Wayfarer project – with just 40 units still to sell – Geocon wanted to appeal to Canberra’s appetite for high-rise towers.

“We want to challenge it – match it or exceed it but we haven’t got to that level of detail yet,” Mr Georgalis said.

He said while the market was tough, the competition led to innovative projects that attracted buyers.

Ray White Commercial Canberra director Andrew Smith said because it was a long-term staged development during 10 years, the usual market supply-and-demand equation did not apply.

He said the commercial market was performing strongly at the moment in the territory.

“All the development sites are selling well, as evidenced today, there’s plenty of developers looking for land,” Mr Smith said.

Land Development Agency sales and marketing acting director John Mason said the agency had decided to sell the block of land in its entirety because it would be easier for the one buyer to work with the Labor Club.

He said the LDA expected a sales price close to the result but had been aware of negativity around town centres and uncertainty about the Commonwealth Department of Immigration’s potential move.

Mr Mason said the sales result showed developers had confidence in the Belconnen town centre and in the Canberra market generally.

There were 11 registered bidders at the auction for the land, including the Labor Club, which placed bids on the site but dropped out when the price moved closer to the $20 million mark.