Castle Group buys Sydney site for $120m, plans to build 550 homes

The western Sydney-based developer had been talking to site owner Hellenic Village “for a while”, but the opportunity to purchase the site came up recently, Castle Group development head Stuart Allen told The Australian Financial Review.

“It’s a growth market corridor,” Allen said. “We see huge opportunity to be able to develop up to 550 houses for a range of different buyers. We’ve got a vision to make this a sustainable master-planned community, well-connected to local infrastructure and local amenity.”

He declined to reveal the likely pricing for homes in the precinct or to give a probable end value of the project, but said the company aimed to lodge a development application this year and start construction in 2027. Castle Group declined to say how it would finance the project.

Its plan for the site, rezoned as R2 low-density residential in 2013 with an average of 13.3 homes per hectare, reflected the fact that lower-density homes were more viable to develop in the current new-housing market, which has been dogged by high costs of materials and financing, said Nicole Gurran, a professor of urban and regional planning at University of Sydney.

“Under current market conditions, it’s a lot less financially risky to go with lower-density, greenfields-style developments,” Gurran said.

“But even what might appear to be lower density in comparison to multi-unit buildings is still quite a lot denser [than it was]. Even in greenfields development that’s low-rise single homes, you can still do really interesting, flexible things. You can have space for granny flats at the back. You can get a reasonably dense pattern of housing that’s not multi-unit development.”

The developer bought the Lot 10 Gurner Avenue site from Hellenic Village, a philanthropic umbrella organisation of 21 Greek community associations, which was originally granted the land by the state government as a long-term lease in the 1980s, and acquired it in the 1990s.

“The historical vision was to create a Hellenic village, a mini-suburb with a Greek church, lots for different cultural and community groups and some private housing,” Hellenic Village president George Mpliokas said.

“But that’s no longer the immediate vision. The value has increased significantly over the last generation and created the opportunity to utilise and leverage that value into what will help keep the community sustainable into the future.”