Alexandria was once known as the “Birmingham of Australia” for its hundreds of factories. Today, the south Sydney suburb still contains a smattering of warehouses and light industry, punctuated by commercial buildings, residential high-rises and clusters of construction cranes.
Yet it is also home to The Grounds of Alexandria, a favourite brunch spot that provides a hint of an altogether different future. Vegetables are grown in an organic garden, a small farm houses Kevin Bacon, the resident pig, and the café boasts long queues every Saturday.
In northern Alexandria, the Green Square urban renewal project is a 278-hectare, A$13bn ($9.4bn) development that is predicted to turn the area into Australia’s densest neighbourhood.
A total of 10,000 apartments are due to be completed over the next four years. By 2030 Green Square — a 10-minute drive from both Sydney airport and the central business district (CBD) — will be home to as many as 61,000 residents, with a density of 22,000 people per sq km, according to the local authority. There is also discussion of a light rail system to connect the new quarter to the rest of the city.
It will be a departure for a city famous for its sprawl — Sydney has a geographic spread larger than London but a population less than half its size. Immigration, however, is at a record high, with more than 84,000 people moving to Sydney between 2013 and 2014. The population is predicted to hit 5m next year.
Green Square is part of a series of new inner-city redevelopments tempting residents and buy-to-let investors away from larger homes on the fringes and into the city centre, propelling a high-density urban planning model more akin to London, Paris and New York.
As Sydney grows more cosmopolitan, “buyers . . . now prefer to live in apartments and no longer aspire to own a house and land,” says Pauline Goodyer, founder of Goodyer Real Estate.
Approvals for apartments by the City of Sydney have more than doubled since 2007, from 1,656 to 3,321 this year, with Alexandria typical of this trend. A contemporary three-bedroom apartment on Power Avenue in the area is on sale with estate agency McGrath for A$1.3m.
The flurry of construction comes on the back of a citywide housing boom. Prices in Sydney have risen 44 per cent over the past three years, according to the Housing Industry Association. Its figures also show that annual growth in residential property reached 18.9 per cent in the year to June, compared with 7.8 per cent in Melbourne and 2.8 per cent in Canberra.
Differentiating Sydney from other major financial districts is its natural harbour, framed by the Opera House, Royal Botanic Gardens and Harbour Bridge. Views of these attractions act as a “magnetic force” upon wealthy buyers says Andrew Wilson, senior economist at real estate firm the Domain Group.
Chris Johnson, chief executive of advocacy group Urban Taskforce Australia, is one person who downsized this year from a house to a centrally located apartment with views over Walsh Bay, a short walk from the Harbour Bridge. Plans have been approved for a A$139m revamp of Walsh Bay that will transform the former seaport into an arts hub, with a floating stage between the area’s distinctive finger wharves and a new waterfront square.
“Sydney is evolving fundamentally from being a city of low-rise suburbs to an urban city where, in the next 30 to 40 years, probably half the population will be living in apartments,” says Johnson.
“Density is not such a dirty word any more,” says Sydney-based architect Eoghan Lewis, who thinks the inner-city areas are undergoing a “renaissance”.
Chippendale, a former working-class suburb south of the CBD, is another area witnessing change. One Central Park — a residential tower featuring “vertical gardens” — opened on the site of a 19th-century brewery in 2013. A two-bedroom flat with a balcony in the block is on sale for A$2.42m through either Frasers Property or Sekisui House.
This summer saw the opening of the Barangaroo Reserve, the first phase of a 22-hectare, A$6bn redevelopment west of the Harbour Bridge. There are plans to pedestrianise the CBD’s shopping thoroughfare, George Street; and in August the Goods Line, an urban renewal project of pedestrian and cycle lanes, opened on a former railway line.
Some inner-city apartments now command the same price as standalone houses in traditionally wealthy areas in the Eastern Suburbs. In Bellevue Hill, a six-bedroom house on sale for A$9.5m through Sotheby’s International Realty. The same agent has a three-bedroom apartment on College Street in Sydney’s CBD for A$8.5m. Agent Rohan Alexander is marketing a two-bedroom flat on nearby York Street for A$2.5m.
Andrew Wilson says one reason behind the rising appetite for apartments is the rising number of international buyers, who by law are limited to buy new or off-plan properties. Yet with a gap between blocks approved and completed, there is a significant number of units in the pipeline, says Nigel Stapledon of the University of New South Wales Business School, who has warned of a “tsunami of home supply coming”.
“Can [the market] absorb the supply at current prices or does it need a lower price for that additional shock?” he asks. Financial services group Macquarie predicts that house prices have peaked and may decline by as much as 7.5 per cent over the next two years — albeit from very high levels.
Not everyone agrees. “Even though we are seeing record numbers of apartments being approved, there really is no end to the queues of buyers lining up [for] presales,” says Wilson. However, he believes there is “no prospect” of prices continuing to grow as they have in the past three years.
For now, buyers continue to invest. In August, Crown Group launched Infinity, a new development within Green Square with prices starting at A$650,000 for a studio apartment. Of the 326 apartments released 105 were sold within the first hour.
Hullabaloo over Barangaroo
Barangaroo started out as a container terminal: a gritty port in the centre of Sydney near the Harbour Bridge. Known as the “Hungry Mile”, this was once where labourers gathered to find work on the docks. Now a A$6bn redevelopment of a 22-hectare site, due to be completed in 2022, is sparking a vast, and controversial, transformation of the area.
It is the first time a single developer has been given such a large block of land in the city. This year saw the opening of the first phase, Barangaroo Reserve, an area of parkland that, in reference to its industrial history, features a container terminal planted with 75,000 native shrubs and trees.
Once finished, the development will include 320,000 sq metres of office space, 90 retail outlets and 143,000 sq metres of upmarket high-rise and low-rise homes. Developer Lend Lease predicts the site will eventually cater for 23,000 workers, 3,500 residents, and a further 2m visitors each year. Plans include a 275-metre hotel tower that will be Sydney’s tallest building.
However, many are unhappy with the project. In 2005, the New South Wales state government launched an international urban design competition for the site — the first held in the city since the Opera House in 1955. Just months later, the winners — Hill Thalis Architecture + Urban Projects — were replaced by Rogers Stirk Harbour + Partners.
Barangaroo is public land, but over the past decade the proposed floor space for the project has doubled (it now includes a casino run by the Australian billionaire James Packer). In 2010 Scott Woodcock, then director of core programs at the National Trust of Australia, said the plans amounted to the “privatisation of the harbour”.
“Profit and private interests are clearly being put ahead of public good,” stated the Lord Mayor of Sydney, Clover Moore, in April. “How is it that a public asset has been turned into private developer land?” asked Sydney-based architect Eoghan Lewis. “It’s like a car crash.”
When the first residencies were put on the market in 2013, all 159 units sold out within four hours, with a penthouse selling for A$10.5m. Yet just 2.3 per cent of the residential space was put aside for low-cost housing.
And while there is a proposal for an indigenous art gallery in the complex, indigenous architects have spoken out against a lack of consultation in an area that holds significant cultural value for Aboriginal people.
● Sydney has a subtropical climate. Summer highs average at 27C but can rise to more than 40C
● Foreigners are officially restricted to buying new or off-plan property, subject to approval by the Foreign Investment Review Board
● Stamp duty is A$40,490 for properties priced at more than A$1m, with A$5.50 added for every extra A$100
What you can buy for . . .
$500,000 A new off-plan studio flat in Green Square
$3.5m A house close to Bondi Beach
$7m A five-bedroom house with views over Tamarama Beach
For more properties, please visit ftpropertylistings.com
Photographs: Gold Hat Photography; Jamie Williams; Sydney Harbour Foreshore Authority; Paul Lovelace/Alamy; Hamilton Lund/Barangaroo Delivery Authority