VALUE: Hunter Street Mall.COMMERCIALproperty in Newcastle is surgingon the back of thecity’s much-hyped resurgence, with latestfigures showing land valuesare set to reach $1 billion for the first time.
Figures from the NSW Valuer General reveal that commercial land value in Newcastle grew by 14 per cent across thelocal government area in the past 12 months, with once-stale CBD addresses rising on the back of new investment in the city.
Leading the way was the city’s main artery, Hunter Street.
Despite concerns from Hunter Street business operators that the state government’slight rail project will hurt their trade, commercial land value for mixed used propertyroseby 25 per cent between 2015 and 2016.
Dane Crawford, from Colliers International, said muchof the demand in the city was coming from the residential sector, making mixed-use sites particularly attractive.
“When you get an increase in land value it suggests an increase in desirabliity,peoplewant to be there,” he said.
Further out, Park Avenue inAdamstown and Lambton Road in Broadmeadow each recorded 20 per cent growth on commercial land values.
NSW Valuer General Simon Gilkes said commercial property rates had increased“strongly”.
“The new university building in Hunter Street together with high-rise apartment developments in the CBD and fringe areas has had a positive influence on the commercial property market,” he said.
Elsewhere in the Hunter though, the commercial sector didn’t fare as strongly. While Lake Macquarie sawgrowth of about 13 per centdue to lower interest rates and improved investor confidence, markets inboth Port Stephens and Maitland struggled.
In Port Stephens, business development zoned land at Salamander Bay and Taylor’s Beach eachsaw bigdecreases.
The commercial property valuations follow surging residential land values in 2016, with newly trendy suburbs like Carrington, Maryville, Islington and Wickhamdriving much of the growthacross Newcastle
Mr Crawford has handled the sale of the Herald apartments, and said demand had been “unprecedented”, with sales from $600,000 to more than $2.5 million.
“We’ve been in the market for fivemonths and we’ve only got a handful left to sell, Newcastle is absolutely on the map,” he said.
News of Hunter Street’s resurgence will come as welcome news to Sam Arnaout, from Iris Capital, who spent about $40 million buying 1.66 hectares of the Hunter Street Mall late last year, with plans to buildabout500 residential apartmentsand 7600 square metres of boutique retail and commercial space at ground level.