CITIMARK DEFIES THE MARKET, SECURES $200 MILLION TO FUND NEW TOWER
Written on the 23 November 2017 by Paris Faint
BRISBANE-based Citimark Properties has secured $200 million in funding to add a new gem to the Surfers Paradise skyline.
Construction on the 46-level 210 apartment Markwell Residences is due to begin in the new year, and in a remarkable twist, Citimark managing director Angus Johnson revealed that for the first time in Citimark's history it did not approach the big four banks to fund the project.
"Citimark has a long track record with all four major trading banks and for the first time in our history, we did not approach any of them to fund the construction of Markwell Residences," said Johnson.
According to Johnson, Australia's property development finance climate continues to stifle larger projects, despite the Gold Coast standing out as a market darling.
"The shortage of finance has impacted significantly on new supply despite very evident demand and the Gold Coast having one of the highest population growth projections in Australia," he said.
"We believe the Gold Coast is fundamentally one of the strongest markets in Australia with a significant undersupply, growing population and more than $12 billion in private and public infrastructure investment in the immediate region."
The Gold Coast boasts the lowest vacancy rate across Australia's six largest cities.
National director of Deloitte Real Estate James Walsh, who arranged funding for the Markwell Residences, said the vacancy rate was especially attractive to financiers.
"There is a significantly low supply of new projects actually being constructed in the central Gold Coast region," said Walsh.
"This is reflected in the record low residential vacancy rate across the Gold Coast which was recently estimated at 0.9 per cent."
Johnson added that interest from the Australian market was key to Markwell's sales success, and that most of the sales were sourced from local and Sydney-based agents.
Hutchinson Builders has been appointed to construct the property.
Business News Australia
Author: Paris Faint