High costs leave projects in limbo
BUNDABERG has developments worth tens of millions of dollars left waiting in the wings, after global financial crisis and an increase in developers' costs.
While they have not been scrapped, no progress has been made on ambitious — and expensive — developments around the region, including several hotels and retail projects.
The developer of Dockside on Quay, a $15 million luxury unit complex on the Burnett River, said “not much” was happening with his project, while he kept waiting for investors.
Two large industrial and retail complexes have also proved slow to get off the ground. The planned Walla Street shopping centre remains mired in a legal battle, and a Maxam Developments industrial precinct on Bargara Road is still on the drawing board.
But Urban Development Institute of Australia Bundaberg branch acting president David Newby said hopes were high that the projects would still go ahead.
“The development sector as a whole has had trouble getting finance and buyers are reluctant,” he said.
“There has also been a rise in developers' infrastructure contributions, which has pushed up costs.”
He said while there seemed to be a common perception that developers were crying poor, the increased costs had a serious flow-on effect.
“If the developer has to pay an extra $20,000 per block of land, he does have to pass it on (to the home buyer).
“If he doesn't proceed with his development because the costs are too high, it still means there is less land available, which pushes up prices.
“It means people can't move here, there's fewer jobs and less affordable housing. It has major implications for the whole town.”
Mr Newby said he had just come back from a meeting in Brisbane with other regional representatives of the UDIA, where a taskforce was set up to combat these issues.
“They are concerned about delays with councils and the increase in charges,” he said.
“The government has admitted there is a failure in the system, so now we need to work on a solution.”