Redfern's ready for its close-up as developers set sights on the fringe

Which it now does, according to James Bellew, of Colliers International. He has been involved in several redevelopment sites in Redfern, which is shaping up to be a hotbed for this sector of the market.

Bellew has worked with developers on the redevelopment of the Redfern RSL site into an 18-storey mixed residential, commercial and retail property. "Developers are trying to take advantage of the location, which is close to the rail and the city, and Redfern has laid dormant for so long,'' Bellew said. ''It has not seen significant development for a while but a change in the market has made redevelopment in Redfern a lot more feasible."

Mr Bellew said developers were already achieving strong presales off-the-plan with 62 of the 84 apartments in the RSL site sold, satisfying the pre-commitment requirements for funding and highlighting the demand of this type of product. Closer to the CBD however, redevelopment plans were a little harder to get off the ground.

Colliers's Paul Fernandes said in the past, the general trend in the Sydney CBD fringe has been for developers to speculative build and then find tenants.

"The problem now is banks are not pre-pared to lend unless there is a substantial tenant or purchasers pre-commitments, which is not what has been happening in many of the fringe developments," he said.

"The CBD fringe is now in a catch-22, situation. In the past it's relied on spec buildings but now there's a true lack of development because projects can't get out of the ground.

"We will see commercial tenants being lost to outer markets like south Sydney, the North Shore, Homebush/Rhodes, North Ryde and the western corridor of the CBD."

Source: www.smh.com.au/business/redferns-ready-for-its-closeup-as-developers-set-sights-on-the-fringe-20091023-hdbd.html