Brisbane developer Don O’Rorke hits pause on Yeerongpilly Green

Slow apartment sales and the weak economic environment post coronavirus prompts rethink on timing.

Consolidated Property exec chairman Don O'Rorke. Picture: Mark Cranitch

Slow apartment sales and the weak economic environment post coronavirus has prompted Brisbane developer Don O’Rorke to pause work on his latest project.

Consolidated Properties was set to begin construction on the first phase of the Yeerongpilly Green master planned community at Yeerongpilly, south of Brisbane, in the third quarter of the year, but work on the 100 apartments and shopping centre is now unlikely to begin until next year.

Mr O’Rorke, the company’s founder and executive chairman, said off-the-plan apartment sales slowed in the wake of the coronavirus pandemic, with buyers unwilling to spend large amounts of money on an intangible asset in the current economic climate.

“There is a nervousness in the market to commit to something a couple of years out,” he said. “You can’t make a start on a project without enough pre-sales and this has really slowed us up.”

“It is very difficult at the moment. We have had a health crisis and we believe we are in a recession. None of this goes to consumer confidence and long-dated projects

“But, I hope the calendar year will see this (the current economic situation) out and that we come into next year with renewed faith, but I know that is an optimistic view.”

The development boss also backed calls by Meriton apartment king Harry Triguboff for greater stimulus for the unit sector in light of the federal government’s $668m HomeBuilder package, which largely targets new detached residential housing and renovations.

The development is also facing some concern in the retail space, with several key tenants voicing worry over leases within the promised community shopping centre.

While the neighbourhood centre is anchored by supermarket giant Woolworths, several smaller tenants - including the cinema, gym and childcare centre - could not commit to the project's initial timeline due to challenges on each industry posed by the virus.

Mr O’Rorke shrugged off these concerns however, believing there will be a repricing within the neighbourhood centre asset class in the medium term.

Yeerongpilly Green is one of two community projects Consolidated Properties is completing in collaboration with the Queensland government.

On Tuesday, the state announced a slew of stimulus measures targeting the property and construction industry, including a $100m “Work for Tradies” housing construction scheme, a $106m commitment to first home buyers and regional home building grants and $50m for local governments in the state’s southeast to commit to small scale public works.

Neither project is likely to benefit directly from the scheme, but first time homeowners will get an additional financial boost if they choose to buy in.