TOKYO-based train company Odakyu Electric Railway has chosen Australia as the destination for its first overseas real estate development, by teaming up with Japan’s largest homebuilder Daiwa House Industry to develop a JPY¥50 billion, 1,500-lot residential housing development in Sydney.
This project is also the first overseas collaboration between the two Japanese giants and Daiwa House’s inaugural major development project in Australia.
The Box Hill project, Daiwa yesterday secured approval from the Foreign Investment Review Board (FIRB), which will pave the way for the JPY¥50 billion (approx AUD$613 million) development of the 89ha site which is expected to yield 1,511 lots. Located at 93-103 Boundary Rd, 35km from the CBD, the new urban development is near the newly constructed Rouse Hill Station on the Sydney Metro.
The first release includes approximately 160 lots and the project will be developed over eight stages, slated for completion by the end of December 2025.
Odakyu Electric Railway said this project is inline with the company’s strategy to expand its operations into overseas markets.
Sydney was a natural choice for the JV partners due to population growth and a long-term housing shortage. They noted that the population is expected to grow from 4.7 million people in 2016 to 6.44 million people by 2036 and to 8 million people by 2056.
“With firm population growth, there is annual housing provision anywhere from 13,000 to 30,000 homes but its actual annual housing requirements are approximately 36,000 homes (average), meaning the city faces a long-term shortage in Sydney.
“In light of these market conditions, Daiwa House Industry and Odakyu Electric Railway moved to launch a new real estate development project in the Sydney suburb of Box Hill,” they added.
The JV partners said the target market will mainly be affluent workers including first home buyers living.
“We also will sell housing land to local Australian housing sales companies.”
Odakyu Electric Railway operates the Tokyo and Kawagawa rail service and services an average of 2.06 million people daily. Recently, the group expanded into real estate development in Japan and said it is looking overseas to “capture new income streams and establish a growth cycle for the future.”
“Through this project the company will examine expanding their existing group presence in Australia and also explore potential for business development in other areas overseas.” Odakyu Electric Railway said in a statement.
Founded in 1955, Daiwa House is Japan’s largest homebuilder and operates in over 20 countries globally. In Australia, the group established a local subsidiary in Queensland, Australia in December 1987. In September 1989, the company completed a 35-storey 92-unit apartment.
In May 2011, the company established Daiwa House Australia as a local subsidiary as part of an effort to reengage in the Australian market, leading to the development of the Flouer Mill of Summer Hill project (360 units) and the TEMPO (Drummoyne project) (164 units).
Daiwa House’s subsidiary Rawson Group will develop and construct the homes. It will also conduct sales of housing subdivisions.
Rawson Group CEO Matthew Ramaley said this land development project is taking place in a wonderful location in Sydney.
“The Daiwa House Group undertaking a large-scale residential housing development project in the Sydney area is a significant opportunity for the Rawson Group to offer our high-quality Rawson Homes and Thrive Homes housing products to a great number of customers.” Ramaley said.
Australian Property Journal