Property leaders table their election wish-list: NSW
Approaching the pointy end of the 2019 Federal Election Campaign, we asked some of LJ Hooker Commercial’s business leaders around Australia to identify the issues in their regions affecting their clients and marketplace. Today, we look at NSW.
New South Wales
The impact of last year’s Hayne Royal Commission continues to reverberate through the commercial property market.
LJ Hooker Commercial Penrith Principal David Reardon said commercial transaction volumes were down 30-40% through Sydney’s Outer West compared to 12 months ago, with the challenge of securing finance the primary influence. The difficulty in obtaining finance has curbed many business owners’ ambitions of making the leap to owner-occupancy, creating strong competition in the leasing market.
“A finance application that should take three weeks is now taking three months with the number of hoops borrowers have to jump through,” said Mr Reardon.
“Compounding the problem is the trend of overly-cautious valuations.
“I think everyone agrees that lending needed to be tightened up, but it’s now gone too far and is adversely impacting the market. I have plenty of clients who have decided to just wait until the banks free up finance again; they just see the current conditions as too hard.”
Mr Reardon has called on the federal parties to place access to finance on the election agenda.
In the growth heartland of Western Sydney – where plans for the second Sydney Airport at Badgerys Creek are progressing – Mr Reardon said the business community needed confidence to deliver private investment alongside public infrastructure.
Master planners for the 191ha business park surrounding the Airport were announced in November. The airport is slated to start operations in 2026.
In the recently announced Federal Budget, $3.5 billion was announced for the North-South Rail Link which will service the future airport.
“The plans for the airport and business park are progressing but the re-zoning of land and introduction of services could be brought forward for the business community,” said Mr Reardon.
South of the airport precinct, Aaron Ward, Managing Director of LJ Hooker Commercial Macarthur, said fast-tracking the first stages of the Business Park would be welcomed by the business community and workers.
“Government needs to take the lead on services – roads, water, electricity – to entice developers to kickstart activity,” said Mr Ward. “Developers will sit back until that happens – there’ll always be a reluctance to be the first to go in there.”
Mr Ward said the airport would be a major employer in an area that is attracting continued residential growth through areas including Oran Park, Leppington, Narellan.
“At the moment, there’s a huge amount of commuting from the new residential estates to employment hubs outside of the precinct,” he said.
“This is a transformational project for Western Sydney and we hope the engagement of private industry to deliver the surrounding industrial, commercial and retail offerings are as important a consideration as ensuring the runway is ready by 2026.”
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