Broadway development on track – conditionally
Frasers Property, developer of the old Kent Brewery site on Broadway, has rejected reports in The Sydney Morning Herald that the project has been “put on hold” and says it will continue to meet contractual obligations, including the staged payment of $32 million to the Redfern Waterloo Authority (RWA).
Even so, the company acknowledges that funding for major construction has not been secured and has become difficult to source because of the global financial crisis.
According to Fraser’s: “The programme of works is unchanged. Demolition and remediation is continuing until mid-2009 and preparation of Project Applications for individual buildings is still in progress, with construction proceeding over a period 8–10 years, commencing in 2010.
“Frasers Property acknowledges that these are challenging times for the development industry with reduced access to project funding for large scale developments. Frasers continues to believe in the viability and substantial community benefit of the Frasers Broadway project and is continuing to work towards its realisation.”
Two planned public parks would nevertheless be finished on schedule, Balfour Park by December ’09 and Main Park a year later. Frasers Studios, a Kensington Street warehouse made available rent-free to artists, would continue to operate, and other premises in the street were being offered to a food co-op which had approached the company.
Kensington Street is a public thoroughfare and Frasers says it is in everyone’s interest to activate it, providing community benefit and improving safety.
The completed Broadway project would house around 8,000 residents and workers and offer 2,300 car spaces.
A condition of approval for the development was a staged payment of $32 million to the RWA, with $6 million due on June 30 each year starting from 2009, with an adjustment in the final year based on the final approved floorspace ratio.
The RWA controls redevelopment in Redfern, Waterloo and Eveleigh Railyards. The then Minister for Planning Frank Sartor took control of the project away from the City of Sydney under the controversial Part 3A planning law, and then took over the RWA after resigning as minister. He has since moved again to the Sydney Harbour Foreshore Authority.
If Frasers defaults, the RWA can charge interest of 2% above Bank Bill Rates.
But while the company’s statements are upbeat, Frasers’ managing director Dr Stanley Quek has sounded a note of warning.
“Developers cannot develop without borrowings,” he said. “Banks in Australia and Singapore are strong but have become tight with lending, carefully re-assessing risks before making decisions.”
His statements sound the alarm for other major Sydney developments including Barangaroo at Darling Harbour East and, according to a senior planning source, Green Square. If these projects were delayed or scrapped, there would be a significant impact on the NSW economy and on housing availability in inner Sydney.
