Australian Property News

$58m sale a sign of confidence in Darwin

Posted on Tuesday, December 13 2011 at 12:47 PM

A recent sale of a Darwin high-rise has set a new record for commercial buildings.

The nine-story Wood Street Jacana House building has been bought for $58,750,000.

First National Commercial principal Jeremy O’Donoghue says the sale is reflective that confidence is picking up again in the Darwin market.

“Obviously there’s a lot of reasons, including the US marine supply base and the US defence being announced,” he says.

“Darwin is seemingly one of the only places that offers a bit of return.”

He adds falling interest rates have also been helping the market.

Chief executive officer of Real Estate Institute of Northern Territory, Quentin Kilian, says the expected $36 billion Inpex announcement (which has the potential to tap into 12.8 trillion cubic feet of gas in the Browse Basin) is also increasing confidence.

“Financially, if Europe collapses, then all across the world will be an impact on financial markets. While I can’t say here we’re isolated, we do have a lot of activity going on that won’t be impacted by it,” Kilian says.

“Inpex says they’ve got the money so the logic to that is that our products here will still continue (to sell). As long as the Asian market has growth rates above seven per cent, it still gives us the comfort that we can continue to buy.”

Quentin believes high-end buyers are also coming back.

“In areas like Larrakeyah, a house there recently had an offer of $1.3 million, but the vendor is holding out for $1.5 million or $1.6 million. People are looking to wait until the market turns around again. Given the fact we’ve seen a doubling of first homebuyers in this flurry of activity, I think it will keep ascending next year. The early part of the year will tell us the activity is continuing or whether it’s just a blip.”