What hosting the Olympics meant for Sydney's property market
The Sydney 2000 Olympics coincided with “a golden era” for real estate in the city. It also raised the profile of Australia to the global audience for the Games and the capacity of Sydney to organise and run what was lauded at the time as “the best Olympic Games to date”.
The event gave Sydneysiders great pride in hosting international visitors and global viewers. It set new standards for the value of the broadcasting revenue and contributed to the increased “value” of the Games to host countries. Furthermore, it created an army of volunteers who contributed enormously to the success of the event. For the period of the Games the trains even ran on time!
In terms of real estate, Sydney’s financial sector was expanding rapidly with the growth of the banking, listed property trust, insurance and professional services sectors. Following the city being awarded the Games in the early 1990s, while unrelated to the win, there was substantial commercial development in the CBD leading up to the Olympics.
Furthermore, there was strong population growth, largely through migration from other states or overseas immigration in response to, and anticipation of, the economic activity in the city and the associated increased awareness of Sydney through global publicity. This led to buoyant residential development, both urban infill and greenfield.
Homebush Bay was selected as the principal sporting precinct, including the athletes’ village, which enabled the remediation and development of an otherwise isolated and contaminated major landholding within the city. The development of the sporting facilities, broadcasting centre, athletes’ village and associated facilities maintained a construction “boom” in the city.
Unfortunately, the site’s master planning, including the public transport infrastructure, was not commercially based, particularly in terms of the post-Olympic legacy. There was more focus on building architectural monuments than considering the post-Olympic integration of the precinct with the broader metropolitan area. While there has been some valuable infill development within the precinct that assists in the activation of an otherwise brick-paved “oasis”, the limited consideration of a commercial strategy, combined with the management of the precinct by government, has constrained the mixed–use development opportunities.
Nevertheless, there has been substantial real estate development outside of the precinct by the private sector, which has been assisted by the Olympics raising the profile of this area in Sydney. The private sector is far more agile and commercial than the state government can be in this development process.
Like many Olympic Games host cities, Sydney continues to pay for the facilities provided in terms of an operating deficit for the Homebush Bay precinct. However, Sydney is fortunate to have the economic capacity to absorb this post-Olympic legacy. The greater issue for Sydney is the limited use of the facilities developed for the Games, which is both a function of the somewhat isolated nature of the facilities, limited accessibility and minimal activation within the precinct in terms of permanent restaurants and entertainment. This is gradually being addressed through the location of sporting teams within the facilities and commercial, associated retail and residential development within the precinct.
There is no doubt that the scale of the Olympic Games can be city changing, particularly in terms of improved infrastructure and public domain in host city CBDs and around the associated sporting facilities. However, there needs to be more consideration of the post-Olympic legacy in terms of contribution to the city. The Olympic Games are typically a “blip” in the lifespan of a city that must work for generations to come. The impact on real estate is minimal.Wayne Redman is regional director of structured transactions and advisory services at CBRE. This article originally appeared on http://olympicsrecord.blogspot.co.uk/
The Mark at Sydney's Central Park
It’s scary, really, how little people know as they consider spending hundreds of thousands of dollars: Terry Ryder
To succeed, you have to go deeper, look behind that shallow analysis of economists and property research firms, and understand what’s happening at a more micro level.
Brought to you by: Caydon
Atria Apartments in Hawthorn offers buyers an opportunity to invest in one of Melbourne’s finest suburbs.
NSW home buyer grants tempting 40% plus of first timers in emerging shift away from established homes