Volatility in the embattled construction sector has forced a Brisbane-based developer to mothball a $140-million apartment tower project touted to “lead the renaissance” of a city fringe suburb.
It is understood sales contracts had been signed for more than 80 per cent of the 121 apartments in Keylin’s Oria development.
Construction was due to begin this year on the Art Deco-inspired tower at Spring Hill on the Brisbane CBD’s northern doorstep.
But in the face of soaring construction costs and crippling labour shortages increasingly putting the feasible delivery of projects at risk, the developer has opted not to progress with the project until conditions improve.
“Australia’s construction sector remains unstable and, despite our best efforts and rigorous tender processes, we have been unable to secure a contractor to deliver Oria,” Keylin managing director Louis Cheung said in a statement.
“As a result, we have made the incredibly difficult decision to not proceed with Oria Spring Hill. It goes without saying that we are deeply saddened.
“Our project team has worked tirelessly to mitigate risks wherever possible, however Australia’s construction sector is too volatile in the current market.”
Cheung said all purchasers had been personally informed this week and full deposits would be returned.
“Keylin will revisit the site in the future when market conditions support the feasible delivery of premium projects,” he said.
The latest move follows Keylin’s decision last year to scrap the other half of what was to be a twin-tower development on the 3700sq m site fronting Brisbane’s Victoria Park redevelopment. It was earmarked to house the city’s first Movenpick Hotel with a total of 96 suites and a daily “chocolate hour”.
At the time, Cheung said rising supply costs and labour shortages were impacting every facet of development nation-wide.
“We have decided to proceed with a competitive construction tender for Oria to provide the best opportunity to secure an acceptable construction outcome,” he said. “Secondly, we have made the decision not to proceed with the hotel on the site.”
Keylin paid $9.25 million for the L-shaped site at 447 Gregory Terrace in mid-2020.
Launching the project in 2021, Keylin declared Oria would “uphold the grandeur and elegance of Spring Hill’s rich architectural heritage”.
“Atop a stunning vantage point offering sweeping vistas of the city, Victoria Park and Mt Coot-tha, Oria is bringing the character back to apartment living by featuring a bold design that pays homage to the Art Deco style woven throughout Spring Hill, allowing Oria to stand among the locale’s multitude of heritage-listed buildings,” it said.
Article source: Queensland Property Investor
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