Cordell Construction Market Movement Report by CoreLogic Asia Pacific

CORDELL CONSTRUCTION MARKET MOVEMENT REPORT QUARTER 1, 2017

CORDELL CONSTRUCTION MARKET MOVEMENT REPORT The Cordell Construction Market Movement Report presents a snapshot of the current state of progress for all active construction projects identified within the last twenty four months that are currently being followed by Cordell’s research team.

NEW PROJECT PIPELINE The section covering ‘New Project Pipeline’ describes the flow of projects identified within the current quarter in terms of volume and value and compares and contrasts this to earlier quarters. The ‘New Project Pipeline’ category does not include projects that were both identified and deferred or abandoned within the same quarter (eg. if a project was both identified and deferred within the same quarter it will be counted in the ‘Deferred Projects’ but not in the ‘New Project Pipeline’ section). The New Project Pipeline monitors projects that have been flagged with the following status; early, commenced, firm, no further information, possible and registrations.

DEFERRED PROJECTS The ‘Deferred Projects’ section reports the volume and value of projects identified within the last twenty four months which have subsequently been deferred. ABANDONED PROJECTS The ‘Abandoned Projects’ section reports the volume and value projects identified within the last twenty four months which have subsequently been abandoned. IN CONSTRUCTION The section covering projects ‘In Construction’ reports the volume and value of projects identified within the last twenty four months which have subsequently moved into the stage of “construction.” Actual construction commencement dates may vary. Note the analysis does not report progress of projects identified outside of the twenty four month window.

CONTENTS

CIVIL ENGINEERING page 6

COMMERCIAL page 10

COMMUNITY page 16

APARTMENTS & UNITS page 20

INDUSTRIAL page 26

MINING page 30

WELCOME page 4

08 APPENDICES page 33

Â© 2017 CoreLogic Asia Pacific. All rights reserved. Data contained in this report is to March 31, 2017. www.corelogic.com.au/cordell CORELOGIC and the CoreLogic logo are New Zealand and Australian trademarks of CoreLogic, Inc. and/or its subsidiaries.

WELCOME Every quarter, Cordell compiles the latest construction projects to deliver an overview of the Australian Construction industry. We take a snapshot of the number and value of new projects in the pipeline, moving into construction, deferred for 6– 8 months, or abandoned. This gives us an indicator of health in the industry in which ideally we would see an increase in construction, and a decrease in abandoned projects. For the March 2017 quarter, Cordell captured approximately 2,700 projects moving into construction. Comparing Q1 2017 to Q4 2016, there was a –5% decrease in pipeline activity, against a 22% increase in construction. Declines in the pipeline were particularly prominent in the apartment and unit space, as well as in civil engineering. In the year to March 2017, the number of development applications captured by Cordell increased 14% on the previous year, suggesting increased confidence in construction. The most active segment of construction in the March 2017 quarter was civil engineering, with 1,298 projects entering construction at a value of $2.2 billion over the period. The highest increase in value between Q4 2016 and Q1 2017, was in mining. Combined values of mining construction was $806 million, up $707 million from the previous quarter.

Deferrals were down 41% across the board when comparing values in the year to March 2017 with the previous year, however the quarterly comparison showed a 20% increase in deferrals between Q4 2016 and Q1 2017. The value of abandoned projects across the country increased from $1.1 billion in Q4 2016 to $2.5 billion in Q1 2017. Over 60% of the value of abandoned projects across the country was in the civil engineering segment. ABOUT US Since 1969 Cordell Information has been at the forefront of providing the most reliable, timely and comprehensive construction industry information. Now that Cordell is part of CoreLogic we are part of the largest and most trusted property data and insights provider in the world and able to expand our insights across the entire property lifecycle. Through CoreLogic, Cordell clients have access to more than half a billion data points generating insights that help more than a million government, construction, banking, finance, insurance and property clients navigate the property ecosystem. This means unparalleled access to critical information and insights across the market sectors of real estate, construction, design, building, engineering, finance, insurance and risk. CoreLogic Australia is a wholly owned subsidiary of CoreLogic (NYSE: CLGX), Australia’s most comprehensive property

4 | Cordell Construction Market Movement Report, Q1 2017

databases. We have more than 20,000 customers and 150,000 end users and employ over 700 people across Australia and in New Zealand. www.corelogic.com.au/cordell Phone 1300 952 560 This report aims to provide a broad overview of the construction industry. If you would like one of our specialists to highlight the detailed analytics that can help you and your business, please email: marketing@corelogic.com.au

Cordell CordellConstruction ConstructionMarket MarketMovement Movement Report, Report, Q1 Q1 2016 2017 | 5

CIVIL ENGINEERING $18.7B

$8.7B

JUN16

$11.7B

$9.5B

SEP16

DEC16

MAR17

National Value of New Civil Engineering Projects NEW PROJECT PIPELINE The value of civil engineering and infrastructure projects decreased 37% on the December 2016 quarter across Australia, despite steady project numbers. Cordell captured 2,058 projects valued at $11.7 billion entering the pipeline. This compares to 2,091 projects valued at $18.7 billion in Q4 2016. Despite the large quarterly decline, the number of civil engineering projects in the year to March 2017 is up 14.3% on the previous year. The civil engineering space seems to be experiencing a pivot to lower value, smaller0scale projects. The decline of value in the civil engineering space largely came from New South Wales. New South Wales accounted for 82% of the quarter-on-quarter value decline. In the March quarter, Cordell captured 611 development applications, valued at $5 billion. While the March quarter saw a relatively low value of projects, the year to March 2017 saw relatively stable values on the previous year, at $22 billion. South Australia also experienced a decline in the number and value of projects in the pipeline from the previous quarter. The three months to March saw 227

new civil engineering projects in the pipeline, valued at $904 million. The most marked increase when comparing the two quarters was in Tasmania, where the value of projects almost doubled to $269 million in the March quarter. One project accounted for 44% of the value of new proposals. The proposal is for a privately owned wind farm development in the suburb of Low Head in the north of Tasmania. Queensland also saw an increase in the value of its civil engineering projects from the December quarter, by $53 million, to a total of approximately $2 billion. Of the 312 development applications in civil engineering captured in the March quarter, 17% were for residential subdivisions. Western Australia and the Northern Territory each enjoyed an increase in the number of proposed civil engineering projects in the pipeline, with new projects captured at 459 and 66 respectively. The value of civil engineering projects in WA fell 33% to $1.6 billion from the previous quarter, while NT enjoyed a small increase from the previous quarter to $149 million.

6 | Cordell Construction Market Movement Report, Q1 2017

Victoria had a relatively steady pipeline of new projects captured in the March quarter compared with the December 2016 quarter. There were 565 new projects in the civil engineering space, valued at $1.7 billion. Of the civil engineering projects entering the pipeline, 27.6% of these were in residential subdivisions, 12.7% were in roadwork upgrades. IN CONSTRUCTION Across Australia, the number of civil engineering projects commencing was 1,298 in Q1 of 2017. Despite the fact that this marked an increase in the number of projects commencing compared with the last quarter, the value of combined projects remained virtually flat at $2.9 billion. This is largely due to the commencement of the unusually high value Mernda Rail Extension project, worth approximately $600 million, in Victoria last November. Given the absence of such a large project in Victoria, it is no surprise that the state saw one of the largest declines in the value of commencing civil engineering projects. The total value of combined civil engineering projects was $751 million in the March quarter,

NEW PROJECT PIPELINE

Number Value

Q1 2017

Q4 2016

YOY Change

2,058

2,091 projects

–1.6%

$11.70 billion

$18.68 billion

–37.4%

IN CONSTRUCTION

Number Value

Q1 2017

Q4 2016

YOY Change

1,298 projects

922 projects

40.8%

$2.9 billion

$3.1 billion

–6.7%

DEFERRED Q1 2017

Q4 2016

YOY Change

Number

35 projects

31 projects

12.9%

Value

$237 million

$335 million

–29.2%

ABANDONED Q1 2017

Q4 2016

YOY Change

Number

48 projects

26 projects

84.6%

Value

$899 million

$44 million

1924%

Cordell Construction Market Movement Report, Q1 2017 | 7

down approximately 40% on the previous year. Victoria did however see the highest number of commencing projects at 467 in the quarter. Approximately one quarter of these projects were in the residential subdivision space.

Thirdly, the $100 million early works package of the Queens Wharf development commenced in Brisbane in January. Over the years the Queens Wharf project is expected to cost $3 billion.

Other large declines were seen in the Northern Territory and South Australia, However these regions on average have relatively small construction values and are subject to volatility.

DEFERRED The number of projects deferred in the civil engineering space increased 12.9% across Australia over the March Quarter, following a steady decline in deferrals in this space over most of 2016. There were 35 deferred civil engineering projects across the quarter.

In New South Wales and the ACT, there were 278 civil engineering projects that moved into construction at a total value of $716 million. Almost 10% of this value came from a single roadworks project around Sydney airport, which includes widening and reconfiguring roads and footpaths to make the terminals more accessible.

Most of these came from New South Wales, where there were 13 projects deferred at a combined estimated construction value of $185 million. Most of this value may be accounted for with the deferral of the $160 million Bankstown Business Estate, which is still in the early planning stages after LEDA holdings withdrew from the project.

Queensland enjoyed the highest combined value of civil engineering projects, with 194 projects commencing at $1 billion.

Tasmania also saw an increase in deferred civil engineering projects from the December 2016 quarter: 2 projects with a combined construction value of $15 million were deferred in the three months to March 2017.

Three large projects accounted for the majority of this value, and indeed were the highest value civil engineering projects commencing across the country. Firstly, February saw the commencement of the Warrego Highway upgrade at Toowoomba, worth $160 million. Secondly, the sun metals solar farm project commenced in Townsville, with estimated construction costs of $155 million.

Each of the other states and territories saw a decline in the number and value of civil engineering projects compared with the previous quarter. ABANDONED Across Australia there were 48 projects abandoned in the civil

8 | Cordell Construction Market Movement Report, Q1 2017

engineering space, with a total construction value of $899 million. This is a significant increase on the number and value of projects abandoned in Q4 2016. In the year to March, there was a 30% increase in the number of civil engineering projects abandoned in the previous year. Most of the quarterly increase was in New South Wales. The state had the highest number of abandoned civil projects at 21, but they were worth a combined $828. This was followed by Queensland, with 10 projects worth $34 million. The Maldon to Dombarton Rail Link is a major infrastructure project which was abandoned in the first quarter of 2017, contributing 77% to the growth in the value of abandoned projects across the country. The proposal, outlining a $660 million rail line from the Illawarra escarpment to Maldon, was intended to ease traffic congestion around Illawarra by taking freight pressure off commuter lines. Transport for New South Wales ran extensive evaluation process to understand the return on investment for the project. However, no respondent was found to be capable of constructing, operating and maintaining the proposed railway line on a commercially sustainable basis, without NSW Government funding.

$155 million

Sun Metals Solar Farm STUART, QUEENSLAND STATUS: FIRM

Expected completion date: April 2018.

$15 million

Carrara Stadium Overlay Works

GOLD COAST CITY, QUEENSLAND STATUS: CONTRACT LET Expected completion date: September 2017.

$2 billion

Snowy Mountains Scheme 2.0 JINDABYNE, NEW SOUTH WALES STATUS: NEW PROJECT

The federal government seeks to expand the Snowy Mountains Hydro electricity generator. The project would involve construction of additional tunnels and substations that will boost the outcome of the hydro-electrical scheme by 50%.

$30 million

Swan Street Bridgeworks Upgrade BURNLEY, VICTORIA STATUS: CONTRACT LET

Expected completion date: December 2017.

$120 million

Wind Farm Development LOW HEAD, TASMANIA STATUS: NEW PROJECT

GHD Pty Ltd is working with planners at George Town Council for the proposal of a wind farm development in Low Head, on the northern coast of Tasmania.

CIVIL ENGINEERING PROJECTS IN FOCUS Cordell Construction Market Movement Report, Q1 2017 | 9

COMMERCIAL $3.9B

JUN16

$4.5B

$3.7B $3.4B

SEP16

DEC16

MAR17

National Value of New Commercial Projects NEW PROJECT PIPELINE Similarly to the December 2016 quarter, the three months to March 2017 were comprised of many proposals for relatively low value projects. The volume of pipeline commercial projects was fairly steady quarter-on-quarter, with 541 new commercial projects captured at a value of $3.4 billion. New South Wales and the Australian Capital Territory showed a 9.7% decline of the number of projects coming into the pipeline, but the value of new commercial proposals increased significantly, by $440 million. This brought the total value of commercial pipeline to $1.28 billion. The highest value project captured in the pipeline for the March quarter was a $149 million proposal for a new office building at Ryde. The next most valuable area for proposed commercial construction was in Queensland, with 84 projects worth $957 million captured in the March quarter. With relatively steady volumes on the previous quarter, the value of projects in Queensland increased 20%. This is largely due to the proposal of a $400 million proposal for a 48 storey, 6 star hotel in the Gold Coast.

In Victoria, there were 133 new commercial projects in Q1 2017, down 8.9% compared with Q4 2016. The value of commercial projects also fell quarter-onquarter and year-on-year. The March 2017 quarter saw a combined construction value of $521 million. This made up approximately 15% of the value of total commercial projects across Australia. Tasmania saw a steady increase in commercial projects over the quarter. Quarterly volumes have only averaged 18 commercial development applications over the last two years. The March 2017 quarter saw 31 applications with a combined construction value of $33 million. Most of the proposals were for accommodation related services, reflecting a strong increase in tourism to the state. Other projects reflected the increase of cafĂŠ culture and shopping in Tasmania, which could be another result of increased recreational visitation. IN CONSTRUCTION The number of construction projects commencing in the commercial space over the March quarter was virtually flat compared with the previous quarter, while the size and scale of projects has

10 | Cordell Construction Market Movement Report, Q1 2017

decreased. In the March quarter, the combined value of projects commencing in this space was $1 billion, down from $1.2 billion in the previous quarter, and below the 2 year quarterly average of $1.1 billion. The largest value of commercial commencement was in New South Wales and the ACT, where the combined value of applications was up $90 million on the previous quarter, bringing the current quarter to $368 million. New South Wales and the ACT also had the highest value of commercial commencements of all the states and territories in the quarter. South Australia also enjoyed sizable increases in the value of commercial commencements, with 17 projects worth $72 million commencing in the March quarter, compared with 18 projects at $49 million in the previous quarter. Commercial projects commencing in South Australia include a carpark, two new supermarkets and several new office and retail spaces. Victoria saw the highest number of commercial projects come into construction at 53, with a combined worth of $138 million. The combined value of

NEW PROJECT PIPELINE Q1 2017

Q4 2016

YOY Change

Number

541 projects

580 projects

–6.72%

Value

$3.45 billion

$3.71 billion

–7.02%

IN CONSTRUCTION

Number Value

Q1 2017

Q4 2016

YOY Change

207 projects

220 projects

–5.9%

$1 billion

$1.2 billion

–13%

DEFERRED Q1 2017

Q4 2016

YOY Change

Number

51 projects

47 projects

8.5%

Value

$391 million

$665 million

–41.2%

ABANDONED

Number Value

Q1 2017

Q4 2016

YOY Change

63 projects

42 projects

50%

$300 million

$209 million

43.2%

Cordell Construction Market Movement Report, Q1 2017 | 11

construction in Victoria actually fell on the previous quarter significantly, as the December quarter saw the commencement of the $120 NDIS office facilities in Geelong, and a new $60 million shopping Plaza at Ballarat. In Q1 however, the highest value commercial construction project in Victoria was the commencement of the $35 million Nexus Court Office building. The 6 storey building, located in the suburb of Mulgrave, is part of a larger Nexus Office Park development. It follows a trend of private office and industrial space being established in the south-east of Melbourne, where land is relatively cheap. Completion of the Nexus office park is expected in July 2020. Queensland had a high value of commercial construction commence in the March quarter, with 42 projects worth $331 million worth of projects commencing in this space. The commencement of the $100 million pulse data centre not only provides short term construction work for locals, but is aimed at attracting major employers in the long term. Tasmania also enjoyed a small boost in commercial construction,

with 10 projects commencing at a value of $6 million. DEFERRED Nationally, the commercial sector has seen 51 projects put on hold this quarter, which is up from 47 projects in Q4 2016. However the combined value of deferrals was far lower at $391 million in deferred project values compared to the $665 million reported this time last quarter. The high value in combined projects in Q4 2016 was largely due to the deferred shopping centre in Roselands, New South Wales. The value of the deferred shopping centre was estimated at $369 million, and made up over 55% of the total value of deferrals across the country. Excluding this project, the total value of deferrals was 32% higher than the previous quarter. The total value of deferrals in NSW was $67 million, comprised of 15 development proposals. The highest value of these was the Scott Street Commercial building in Liverpool, with an estimated construction value of over $33 million. The site is currently for sale with development approval, with negotiations still in progress. Each of the states and territories

experienced a reduction in the value of deferred work in the commercial space, with the exception of Queensland and Tasmania. In Queensland, Cordell captured 19 deferred projects at a combined value of $285 million. ABANDONED There were 63 commercial projects abandoned in Q1, with a 50% rise in the total number of abandoned projects captured by Cordell in Q4 2016. The total dollar figure rose 43.2% from $209 million to $300 million. The rise in values was largely due to the increase in the number of abandoned projects. Most abandoned projects were in New South Wales (25 projects), at a combined value of $152 million, followed by 15 projects in Queensland, where there were $84 million worth of construction values abandoned. Western Australia also saw 7 projects abandoned in the commercial space over the quarter, valued at $27 million. This was largely made up by a $15 million resort project in Brember Bay, which was abandoned at the development application stage.

Major sites abandoned* ff ff ff ff

$50 million mixed use site and associated carpark in Queanbeyan, New South Wales $30 million Bunnings retail warehouse site on Gardner Road in Rochedale, Queensland $15 million eco0tourist resort at Brember Bay, Western Australia, project abandoned at the early planning stage $3 million convenience restaurant and tavern in Maribyrnong, Victoria. Planning application withdrawn

$20 million Tatts Fortitude Valley office fit-out in Fortitude Valley, Queensland. No tender accepted and project abandoned in the early planning stages. $2 million Caltex Connect project, involving demolition of existing retail fuel outlet building to be replaced with new retail fuel outlet building, project abandoned at the development approval stage.

*this list is not exhaustive and intended to provide a snapshot of major abandoned sites only.

12 | Cordell Construction Market Movement Report, Q1 2017

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$28 million

Belmont Forum Shopping Centre CLOVERDALE, WESTERN AUSTRALIA STATUS: IN CONSTRUCTION Expected completion date: June 2018.

COMMERCIAL PROJECTS IN FOCUS 14 | Cordell Construction Market Movement Report, Q1 2017

$440 million

Aquis Pacific Point Hotel

SURFERS PARADISE, QUEENSLAND STATUS: NEW PROJECT

Proposed construction of Australiaâ&#x20AC;&#x2122;s first 6 star, beach front, 48 storey hotel with 580 hotel suites. Features include 5 restaurants, bars, cafes, a rooftop open air cinema, a wellness centre, function rooms and business centre.

$100 million

Gepps Cross Gateway

$149 million

GEPPS CROSS, SOUTH AUSTRALIA STATUS: NEW PROJECT

Talavera Road Commercial Building

Proposed construction of a 100 store shopping hub. The proposed 220,000 square metre development would have scope for a tavern, service station, gym, tenpin bowling alley and indoor trampoline hub, a supermarket and leisure or indoor recreation centre.

MACQUARIE PARK, NEW SOUTH WALES STATUS: NEW PROJECT

Proposal includes demolition of an existing conference centre, and the establishment of a new office building with retail tenancies and a car park.

$65 million

Johnson Street Mixed Use Development

SOUTH MELBOURNE, VICTORIA STATUS: NEW PROJECT

Construction of a mixed use development comprised of two high rise towers containing apartments, retail and commercial spaces.

$76 million

Rail Operations Centre ALEXANDRIA, NEW SOUTH WALES STATUS: IN CONSTRUCTION Expected completion date: June 2018.

$3.5 million

Aldi Supermarket

ADELAIDE AIRPORT, SOUTH AUSTRALIA STATUS: IN CONSTRUCTION

Expected completion date: July 2017.

Cordell Construction Market Movement Report, Q1 2017 | 15

COMMUNITY $6.4B $4.6B $3.4B

JUN16

SEP16

DEC16

$3.8B

MAR17

National Value of New Community Projects NEW PROJECT PIPELINE New community projects were down 3.7% in volume and 17.4% in value in Q1 2017, compared with Q4 2016. Significant decreases in the value of projects were seen in New South Wales, South Australia, Tasmania and the Northern Territory, off the back of a particularly strong December quarter for investment. The combined value of projects across Australia was $3.82 billion, making community projects the fourth highest value segment in the pipeline, after civil engineering, apartments and units and mining. Over 100% of the decline in the value of community project values quarter-on-quarter was in New South Wales, offset by significant gains in Queensland. The December 2016 quarter was significant in New South Wales, with nearly $1 billion in proposals submitted for a 3 storey school redevelopment, a 13 storey addition to the Australian Museum and the construction of a new building for the faculty of health sciences at the University of Sydney. With a combined value of new projects totalling just $917 in the March quarter, it is clear the decline in values can be attributed to the absence of such large projects.

The March quarter saw 184 new community projects put forward in Queensland, at a combined construction value of $957 million. Much of this value can be attributed to the proposal of a $200 million correctional facility in the Rockhampton region. Western Australia saw a small increase in the value of community pipeline projects in Q1 2017 compared with the previous quarter. The state had 174 projects enter the pipeline over the quarter. Approximately 30% of these projects were privately owned, while a majority were state and local government initiative. The largest value of community projects captured by Cordell was in Victoria, where there were 241 new projects captured worth a combined $1.08 billion. Approximately 30% of this value may be attributed to one, controversial project: a youth justice centre. Initially, Werribee South was the chosen site for the centre, but community protests have since seen the project relocated to Cherry Creek, which is west of Werribee. IN CONSTRUCTION Overall, the number and value of community projects commencing across Australia has increased on

16 | Cordell Construction Market Movement Report, Q1 2017

the previous quarter. Based on observations of Cordell timeseries data, community projects tend to increase at a lagged time to increased residential construction, as new services and amenities are created to service newly established residential communities. Q1 2017 saw 512 community projects commencing across the country with a combined worth of $2.5 billion, representing a 22.78% increase in the volume of projects and a 41% increase in values from Q4 2016. The highest value commencement was the commencement of a $500 million correctional facility at Grafton, New South Wales. With an increasing population and prison population, the state government has had several sites rejected due to â&#x20AC;&#x2DC;NIMBYâ&#x20AC;&#x2122; (not in my backyard) community resistance. The Grafton site is one of few new correctional facilities being commenced across Australia, with an emphasis on expanding existing facilities. New South Wales had the highest value of community works commencing in the March 2017 quarter, with $1.2 billion worth of projects commencing. While 41% of this value represents the commencement of the Grafton

NEW PROJECT PIPELINE Q1 2017

Q4 2016

YOY Change

Number

912 projects

947 projects

–3.70%

Value

$3.82 billion

$4.62 billion

–17.36%

IN CONSTRUCTION Q1 2017

Q4 2016

YOY Change

Number

512 projects

417 projects

22.8%

Value

$2.5 billion

$1.8 billion

41.2%

DEFERRED Q1 2017

Q4 2016

YOY Change

Number

49 projects

35 projects

40%

Value

$216 million

$184 million

17.38%

ABANDONED

Number Value

Q1 2017

Q4 2016

YOY Change

51 projects

36 projects

41.7%

$194 million

$183 million

6.06%

Cordell Construction Market Movement Report, Q1 2017 | 17

correctional facility, the rest of the projects were largely on schools, hospitals, community centres and other community amenities. The highest number of community projects commencing was in Victoria, where there were 145 projects captured commencing in the March 2017 quarter. Both the number and value of commencing community projects were higher than in the previous quarter. There were also significant increases of community works commencing in Queensland and Western Australia. In Western Australia, the total value of community projects commencing was $290 million, while Queensland was at $389 million. Major health upgrades and aged care facility projects are commencing across the states. DEFERRED PROJECTS The number of deferred community projects across Australia increased to 49 over the March 2017 quarter, up from 35 in

the December 2016 quarter. The combined value of deferrals in this segments was low relative to other construction sectors, totalling $216 million. In the year to March 2017, there were 229 deferrals worth $1.4 billion. The highest number of deferred projects in the quarter was in New South Wales at a value of $41 million, while the highest construction value of deferrals came from Queensland, at $101 million worth of community projects stalled. Most of the deferrals came from the private sector, with only 12% of the deferred community projects public sector projects. Of these, the highest value in terms of construction cost estimates is the $10 million mixed use development at Subiaco in Western Australia. The development would host a medical centre, theatre, restaurant and shops.

Major sites for sale ff

ff ff

Jorl court student accommodation building: construction of a $10 million student accommodation precinct in Buderim, Queensland. Site for sale and town planning application has been refused. Lot 1, Clovelly Rd in Coogee New South Wales. Site is for sale by auction, with development approval for a Âž storey boarding house. Andrews Road Child Care Centre in Cranbrook, New South Wales. Site for sale with development application submitted, with construction costs valued at $1 million.

18 | Cordell Construction Market Movement Report, Q1 2017

The highest value deferred project in the quarter is a private hospital expansion in Queensland worth $30 million. The site would comprise a 5 storey hospital at Cleveland in the Redland Shire. However no tender has yet been accepted for the expansion. ABANDONED PROJECTS There were 51 projects abandoned at a combined value of $194 million across Australia. Despite the increase in the number of abandoned projects compared with the previous quarter, there was little increase in the combined value of projects, which was $183 million in the December 2016 quarter. The abandoned project which accounted for almost half the total value of abandoned projects was for a $94 million, rapidbuild correctional facility in Emu Plains, New South Wales. The state government initiative was abandoned at the development approval stage.

$200 million

Capricornia Correctional Centre ROCKHAMPTON, QUEENSLAND STATUS: NEW PROJECT

Expansion of the existing Capricornia Correction Centre to comprise construction of 164 new prisoner cells, upgrade to waste water, mechanical services and an electronic security system.

$64 million

St Andrews and Ipswich Private Hospital – Stages 1 through 5C

$167 million

Joondalup Health Campus JOONDALUP, WESTERN AUSTRALIA STATUS: NEW PROJECT

IPSWICH, QUEENSLAND STATUS: SITE PREPARATION IN PROGRESS Expected completion date: January 2021.

Proposed extension of the Joondalup Health Campus could include eight new operating theatres, an expansion to the emergency apartment, 90 new public beds, 25 new mental health beds, six bed stroke unit, a Medihotel and an expansion of the car park.

$60.4 million

Blacktown Mount Druitt Hospital Redevelopment MOUNT DRUITT, NEW SOUTH WALES STATUS: CONTRACT LET Expected completion date: May 2019.

$35 million

Sunshine Skills Hub

$20 million

The Baile Aged Care Facility MARTIN, WESTERN AUSTRALIA STATUS: SITE PREPARATION IN PROGRESS

SUNSHINE NORTH, VICTORIA STATUS: NEW PROJECT

Proposed works to include the development of a new training facility. This would include a health & community services centre of excellence, an innovation and incubation hub, a cafe, gymnasium and bookshop.

Expected completion date: June 2018.

$8.5 million

Nelson & Gibson Streets Wellness Centre SMITHTON, TASMANIA STATUS: NEW PROJECT

Proposed construction of community wellness centre. The centre would include a multi0purpose room, foyer, reception area, office, 25 metre indoor heated lap pool, 12.5 metre program swimming pool and toddler’s swimming pool, store room, courtyard and mechanical plant.

COMMUNITY PROJECTS IN FOCUS Cordell Construction Market Movement Report, Q1 2017 | 19

APARTMENTS & UNITS $15.8B $11.6B

JUN16

SEP16

$12.4B $11.3B

DEC16

MAR17

National Value of New Apartments & Units Projects NEW PROJECT PIPELINE Apartment and unit projects tend to alternate with the civil engineering segment in dominating Australia’s pipeline. In the March quarter, the value of the residential pipeline captured by Cordell was $11.3 billion, which was 31% of the total pipeline. Civil engineering made up 32% of Australia’s $36.7 billion pipeline in the March quarter. However, a significant portion of the civil engineering pipeline is made up of residential subdivisions. This suggests that the Australian construction pipeline is still largely oriented to residential development. Nationally, Q1 2017 reported 1,731 apartment and unit projects entering the pipeline. This is a 10.2% decline on the December 2016 quarter, where there were 1,927 projects in the pipeline. The value of projects coming into the pipeline, at $11.3 billion, fell 8.4% when compared with the previous quarter. Interestingly, the number of apartment and unit projects in the year to March 2017 rose 20%, but construction values were down 13.2%.

In the NSW and ACT, the value of apartment and unit projects proposed in the quarter, as captured by Cordell, was $4.8 billion, which is 42.5% of the total apartment and unit pipeline. There were 402 projects in the NSW and the ACT. The highest value area of pipeline apartment projects across NSW and ACT was in postcode 2762, where there was over $871 million worth of construction captured in residential development applications. In Victoria, the number of unit proposals in Q1 2017 16.35% lower than the previous quarter. However, at 834 development applications, Victoria had the highest number of apartment and unit proposals of the states and territories. The highest number of development applications in this space was in postcode 3073, namely the suburb of Reservoir on the northern fringes of the CBD. Here, 33 projects were captured worth $41.5 million. The combined worth of total unit and apartment applications in Victoria was $2.7 billion, down from $3.2 billion in the previous quarter. The lowest number of development applications was in

20 | Cordell Construction Market Movement Report, Q1 2017

Tasmania, where the March quarter saw 18 projects come into the pipeline at a value of $26 million. In Queensland, the number of apartment and unit projects remained steady on the December quarter at just over 200 new development applications captured. However, the total construction value of projects in this space increased significantly to $2.6 billion. This is largely due to a $1 billion planning project called ‘Better Neighbourhoods Logan’. The planning project aims to deliver 410 new social and affordable dwellings over the next five years, and over 3,000 new dwellings by 2036 in the fast-growing south-east Brisbane region. In South Australia the number of applications was also steady on the previous quarter at 147 projects, however values fell substantially from $525 million to $312 million. Surprisingly, the only states which saw a significant increase in the number and value of apartment and unit projects on the December quarter was Western Australia and the Northern Territory. However, this is largely due to a rebound from relatively low numbers.

NEW PROJECT PIPELINE Q1 2017

Q4 2016

YOY Change

Number

1731 projects

1927 projects

–10.2%

Value

$11.32 billion

$12.35 billion

–8.4%

IN CONSTRUCTION

Number Value

Q1 2017

Q4 2016

YOY Change

434 projects

455 projects

–4.62%

$2.6 billion

$2.9 billion

–7.7%

DEFERRED Q1 2017

Q4 2016

YOY Change

Number

195 projects

182 projects

7.14%

Value

$2.4 billion

$1.6 billion

48.9%

ABANDONED

Number Value

Q1 2017

Q4 2016

YOY Change

132 projects

95 projects

39%

$1 billion

$549 million

84.6%

Cordell Construction Market Movement Report, Q1 2017 | 21

The March 2017 quarter saw 90 project applications in the residential space in Western Australia, with a combined construction value of $733 million. In the Northern Territory, there were 38 projects in the pipeline at a combined value of $147 million. IN CONSTRUCTION The number of apartment and unit projects captured in the construction stage at Q1 2017 is slightly lower than the previous quarter. The number of reported apartments and units moving into construction nationally was 434 projects with a total value of $2.6 billion in Q1 2017. Q4 2016 reported higher values of 455 at $2.9 billion, representing a 4.6% decline in volumes of projects and a 7.8% decline of combined value in Q4 2016. In New South Wales and the ACT, there were 124 apartment and unit projects that commenced in Q1 of 2017. The combined value of these projects was $951 million, representing an 11.8% increase in value on the previous quarter. 13% of the combined value of these projects were specifically in the ACT. The most valuable project to commence in the capital was the Allara Street redevelopment in the city of Canberra. The $45 million project involves the demolition of an existing low level structure and construction of an 18 storey building which will host 190 units,

as well as several commercial units of the ground floor. Apartment projects continue to surge in Victoria, with the number of projects commencing in the state increasing 9.7% over the quarter. This brings the total number of project commencements to 113, with a combined value of $621 million. In Queensland, there were 91 apartment projects commencing across the state in the first quarter of 2017. The total value of projects was $754 million, which was lower than the previous quarter at $894 million. This follows a depression in the project pipeline as the Queensland economy experienced several quarters of subdued economic performance. The largest decline in the number and value of projects was in South Australia, where 36 projects commenced in Q1 2017 as opposed to 66 projects in Q4 2016. The combined value of projects was $89 million lower than the value of commenced apartment projects in the previous quarter. 2016 represented a year of unusually strong residential construction in South Australia, with most projects concentrated in the greater Adelaide metropolitan region. After low commencement numbers of just 24 projects in the three months to January, the

22 | Cordell Construction Market Movement Report, Q1 2017

number of commencing residential projects in Western Australia has rebounded to 43 projects in Q1 of 2017. However, this is still a very subdued number of projects given the average quarterly project number was 136 over 2015, as the commodity price index was at the beginning of a significant decline. In Tasmania, the number of apartment and unit projects declined 20% on the previous quarter, but off a small base. Q1 2017 saw 8 projects commencing, while the value of these projects actually increased to $12 million, up from $10 million in the previous quarter. In the Northern Territory, the reverse phenomenon occurred in which apartment and unit projects increased in volume to 19 projects commencing across the territory in the first quarter of 2017. The value of these projects declined to $30 million from $61 million as the nature of projects shited to smaller scale developments. The Q1 2017 quarter also focused on community and public housing projects, driven largely by the state government.

DEFERRED PROJECTS There were a total of 195 apartment and unit projects deferred across Australia in the March quarter, up 7.1% from the December quarter. The combined value of these deferred projects was $2.4 billion, which saw a significant uplift in value (48%) on the previous quarter. Much of this value came from apartment and unit values in Victoria, specifically the deferral of several projects round Fishermans Bend in South Melbourne, where $570 million in apartments (and supporting services and amenities) had been approved for development. Some developers are chasing sales of the approved sites at Fishermans Bend, while planning applications at the site have been referred to the minister for planning for approval. The number and value of deferred apartment and unit projects was highest in Queensland, where there were 95 deferred developments at a total estimated construction value of $836 million over the quarter. While concern of unit over-supply in Brisbane has prompted the selling of some approved sites, a major contributor to the deferred values was the proposed 91 storey mixed use development at Margaret Street in Brisbane. The construction value is estimated at $240 million, or

28% of the total deferred value of apartment and unit projects in the quarter. ABANDONED PROJECTS The number and value of abandoned projects in the apartment and unit space saw a surge over the March quarter, but is a reflection of different driving factors in different states and territories. The total construction value of projects abandoned was over $1 billion, comprised of 132 projects. The year to March saw the highest value of apartment and unit projects abandoned in over two years, with 481 projects recorded as abandoned over the year, at an estimated value of $3.3 billion.

rapidly rising land prices, a spike of applications halfway through 2016, or more community and council resistance to residential development. Of the major abandoned sites in New South Wales, abandonments were made at rezoning application stages, as proposed developments required higher building heights and higher floor space ratios. Other states and territories saw a modest increase in the abandoned projects in this space, while Victoria saw a reduction in the number and value of abandoned apartment and unit projects.

Over the March quarter, New South Wales saw the largest number of abandoned projects of the states and territories, at 48 projects. The combined value of these projects was over $826 million, making up 81.6% to the total value of abandoned projects across Australia. This is also an unprecedented quarterly result for at least two years. The surge in abandoned projects over the quarter has come against a fairly steady movement in applications. The surge in abandoned projects over the quarter could be the result of a few factors, including

Cordell Construction Market Movement Report, Q1 2017 | 23

Major sites for sale

Major sites abandoned*

Goulburn Street mixed use development in Haymarket, New South Wales. Site for sale by expressions of interest with stage 1 development approval. Negotiations with potential purchasers is in progress.

Nielsens Road Units and Restaurant at Carrara, Gold Coast in Queensland. Site for sale with development approval for 270 units over 7 storeys.

Croatia Ave Mixed development site at Edmondson Park, New South Wales. Planning application initially submitted for 150 apartments over 4 storeys. Site for sale by expressions of interest with amended development application submitted, that reduced the number of apartments from 150 to 105.

Auburn Village, Auburn, New South Wales: The planning proposal sought to increase the floor space ratio controls of the site (up to 0.9:1) and increase the maximum height of building control to 96 metres. The build would be a $150 million, 30 storey, mixed0use development across 2 iconic towers above a commercial podium with a public library space, pedestrian laneway and public plaza dedicated to Council. Project will not proceed in its current form. Moxon Road Mixed Development, Punchbowl New South Wales: Proposal for a series of five storey row apartment blocks and an 8 storey courtyard apartment building with 591 apartments. The $149 million development was abandoned at the re-zoning application stage.

Beamish Street and Ninth Avenue mixed development, Campsie, New South Wales: Proposal for a $90 million, mixed used development including 310 units. A rezoning application was submitted to increase the building height limit from 21 m to up to 70 m. The project was abandoned at the rezoning application stage.

Ferguson Street mixed use development, Williamstown, Victoria: a $20.3 million proposal for construction of a 5 storey mixed use development to include 64 apartments, a food and drink outlet and RSL Clubrooms with gaming rooms. Project was abandoned at the development application stage.

Terry Road Units in Box Hill, New South Wales. Site for sale with development approval for 121 units over 7 storeys.

*these lists are not exhaustive and intended to provide a snapshot of major deferred and abandoned sites only.

24 | Cordell Construction Market Movement Report, Q1 2017

$240 million

Margaret Street Mixed Use Development BRISBANE, QUEENSLAND STATUS: DEFERRED

Project deferred with development approval. The approval is for 783 units, as well as commercial and retail premises, across 91 storeys.

$5.3 million

Gunyangara Employee Accommodation NHULUNBUY, NORTHERN TERRITORY STATUS: CONTRACT LET Expected completion date: July 2018.

$1 billion

Better Neighbourhoods, Logan LOGAN CENTRAL, QUEENSLAND STATUS: NEW PROJECT

Better Neighbourhoods Logan aims to provide a mix of social and affordable housing stock commensurate with Logan’s projected population growth and changing housing profile. The Better Neighbourhoods Logan program will deliver a range of economic and social benefits, including a targeted 410 new social & affordable dwellings over the next five years and over 3,000 new dwellings by 2036.

$99.5 million

Oxford Street Redevelopment EPPING, NEW SOUTH WALES STATUS: CONTRACT LET

Expected completion date: January 2021.

$373 million

Schofields Road Apartments SCHOFIELDS, NEW SOUTH WALES STATUS: NEW PROJECT

This large residential development proposal includes the construction of 17 buildings, each consisting of 5 storeys. The precinct will include open spaces, a children’s playground, new roads and carparks. .

$350 million Premier Tower

MELBOURNE, VICTORIA STATUS: IN CONSTRUCTION

Expected completion date: December 2020.

APARTMENTS & UNITS PROJECTS IN FOCUS

$271 million

Market Street Mixed Development

SYDNEY CBD, NEW SOUTH WALES STATUS: NEW PROJECT Conservation and refurbishment of an existing 10 storey heritage building, in principle development of a 220 storey tower element above.

Cordell Construction Market Movement Report, Q1 2017 | 25

INDUSTRIAL $1.9B $1.6B

$1.4B

JUN16

SEP16

DEC16

$1.4B

MAR17

National Value of New Industrial Projects NEW PROJECT PIPELINE The March quarter saw 418 projects submitted in the industrial space across Australia, at a combined worth of $1.4 billion. This represents a 13.6% decline in the number of proposals on the previous quarter, and an 11.5% decline in value. The quarterly decline follows a general downward trend of commercial real estate construction across Australia. Within New South Wales and the Australian Capital Territory, the value of industrial projects declined 16.5% when compared with Q4 2016, despite having the highest collective value of projects of all the states and territories at $453 million. The decline in value was largely a result of a decline in the number of industrial construction projects. Q1 2017 saw 110 industrial projects enter the pipeline in NSW and the ACT, which was down from the December 2016 quarter of 127 projects. In the year to March however, New South Wales and the ACT, along with Queensland, South Australia and Tasmania each saw an increase in the number of development applications for industrial builds.

Victoria saw a decrease in the number of projects entering the new project pipeline across the industrial sector of 12.4%, however the state saw the highest values of industrial development applications (142). The value of applications in this space rose 8.4% over the quarter in Victoria. In the construction space, Victoria is seeing high concentrations of industrial development on the fringes of the Melbourne CBD. Despite an 8.5% decline in manufacturing employment in Victoria over the last 5 years, strong growth in household consumption, and international consumption, drives new opportunities in food storage and processing, inventory storage and distribution centres. In Queensland, the industrial sector has seen an increase in the total number of new projects entering the market this quarter (5.4%), and a slightly lower increase in value (3.7%). Industrial applications in South Australia declined dramatically over the quarter, with the collective value of pipeline industrial projects at $56 million, compared with $136 million in Q4 2016. This was the lowest

26 | Cordell Construction Market Movement Report, Q1 2017

quarterly result since the June 2015 quarter, and is partially due to a lower number of projects. It also comes off the back of two quarters of above average application values in South Australia, suggesting this may be a seasonal dip. Tasmania enjoyed a surge in the value of industrial development applications, the total value of which was $63 million coming into the pipeline in the March quarter. This is despite a decline in the number of applications. Most of the value comes from a $50 million proposal by Bay Fires of Cheese to construct a dairy storage facility. IN CONSTRUCTION While most of 2016 saw subdued construction in the industrial space, the March 2017 quarter saw a resurgence in growth. Across Australia, there were 201 industrial projects commenced in Australia over the quarter. The projects have a combined estimated construction value of $921 million, representing a 42% increase on the value of commenced industrial projects in the previous quarter. A majority of the value increase came from Western Australia, where the value of projects was up to $316 million in the March

NEW PROJECT PIPELINE Q1 2017

Q4 2016

YOY Change

Number

418 projects

484 projects

–13.6%

Value

$1.41 billion

$1.59 billion

–11.5%

IN CONSTRUCTION Q1 2017

Q4 2016

YOY Change

Number

201 projects

166 projects

21.1%

Value

$921 million

$648 million

42.1%

DEFERRED

Number Value

Q1 2017

Q4 2016

YOY Change

21 projects

30 projects

–30%

$190 million

$62 million

206.5%

ABANDONED Q1 2017

Q4 2016

YOY Change

Number

28 projects

30 projects

–6.7%

Value

$59 million

$85 million

–30.6%

Cordell Construction Market Movement Report, Q1 2017 | 27

quarter, while the number of projects was virtually unchanged. This was driven almost completely by the commencement of the $300 million Mason Road Lithium Hydroxide Processing Plant in Kwinana Beach. Lithium has undergone a surge in demand since March 2016, increasing approximately 11% in USD terms over the March quarter. Lithium is a key metal used for the production of batteries and energy storage systems. As Australia and its major economic trade partners focus on renewable energy targets, energy storage makes this processing plant a timely investment. New South Wales, Victoria, Tasmania and Western Australia each saw increases in the value of industrial construction over the March quarter. Industrial real estate is a versatile space gaining popularity, particularly where there is cheap land on the fringe of cities. A subdued AUD coupled with rising incomes in the rest of the Asia pacific may eventually see an on shoring in manufacturing. Warehouses can accommodate start-up spaces where emerging firms are hesitant to commit to

office leases, and inventory storage and distribution centres will be of increased importance as the likes of Amazon set up retail offerings in Australia. DEFERRED PROJECTS The number of deferred industrial projects fell 30% quarter on quarter, down to just 21 in the 3 months to March. However, due to three unusually large deferrals, the value of construction work put on hold reached $190 million. The first of these was a motorway estate logistics facility located in Redbank, Ipswich. The $70 million project is for a state of the art logistics facility for warehousing and distribution services. The second major deferral was for a $24 million Bunnings construction project in Charmhaven, New South Wales. This project has since been re-opened, and selected builders have been called for tender applications. The Third large deferral in the industrial space was an $18 million proposal for a 3 storey warehouse site at Acacia Ridge, Queensland.

The project was deferred at the end of March following the tenderer being named. ABANDONED PROJECTS Across Australia there were 28 projects abandoned in the industrial space, which is slightly less than the 30 projects abandoned in the December 2016 quarter. The combined value of abandoned industrial projects was down significantly to $59 million from $85 million in the previous quarter. Of the abandoned projects, there were 9 in New South Wales and 9 in Queensland. New South Wales also held the highest value of abandoned projects at $33 million. Most of this is accounted for by one abandoned project in New South Wales, a warehouse and distribution facility in Huntingwood worth $23 million. Despite the abandonment of the project in this particular form, the site has since seen development commenced for a 2 storey warehouse facility for use as a data centre and associated 3 storey technical office building.

Major sites abandoned* ff ff

$9.5 million transport distribution facility at Wingfield, South Australia â&#x20AC;&#x201C; development application withdrawn $5 million cabinet making and joinery warehouses and offices in Garbutt, Queensland â&#x20AC;&#x201C; project abandoned at the development approval stage.

ff ff

$5 million Holcim concrete plant in Koolkhan, New South Wales â&#x20AC;&#x201C; Project abandoned at the development approval stage $2.2 million warehouses in Wakerly, Queensland involving 2 warehouse buildings and an ancillary office project abandoned at the development approval stage.

*this list is not exhaustive and intended to provide a snapshot of major abandoned sites only.

28 | Cordell Construction Market Movement Report, Q1 2017

INDUSTRIAL PROJECTS IN FOCUS $30 million

Oji Paper Warehouse

YATALA, QUEENSLAND STATUS: IN CONSTRUCTION

$300 million

Expected completion date: November 2017.

Mason Road Lithium Hydroxide Processing Plant KWINANA BEACH, WESTERN AUSTRALIA STATUS: CONTRACT LET Expected completion date: March 2018.

$41.2 million

Cotton Seed Processing Plant WEE WAA, NEW SOUTH WALES STATUS: COMMENCED

Expected completion date: January 2018.

$47.5 million

Huntingwood Drive Data Centre HUNTINGWOOD, NEW SOUTH WALES STATUS: IN CONSTRUCTION Expected completion date: March 2018.

$13 million

Deakin University Manufutures Mixed Use Warehouse WAURAN PONDS, VICTORIA STATUS: IN CONSTRUCTION Expected completion date: November 2017.

$49 million

Peel Business Park

NAMBEELUP, WESTERN AUSTRALIA STATUS: NEW PROJECT

Proposed construction of a 1000 hectare, multi-lot industrial subdivision for phase 1 of the Peel Business Park. The park is expected to host 160 businesses, and will be a sustainable industrial zone serviced by water, power, sewer and gas.

$100 million

Broo Limited Brewery BALLARAT, VICTORIA STATUS: NEW PROJECT

Proposal for the construction of “the world’s greenest brewery”, as well as one of the biggest brewery’s in Australia. Broo Limited have acquired 15 hectares of industrial land in the Ballarat West Employment Zone. The planned brewery is set to use solar power to produce the beer, and have a zero-carbon footprint.

Cordell Construction Market Movement Report, Q1 2017 | 29

MINING $5.0B $3.1B $2.7B $1.6B

JUN16

SEP16

DEC16

MAR17

National Value of New Mining Projects NEW PROJECT PIPELINE Mining had the strongest growth of construction segments in the new projects area over the quarter. Applications increased 13% in the March quarter, while the aggregate values were up an astonishing 82.1%. Value growth of applications across the country was largely driven by two development applications. The first was a $2 billion project led by BHP Billiton. The proposal, which is in early planning, involves a replacement for the Yandi iron ore mine, which is expected to be exhausted within 5-10 years. The proposed replacement deposit is the South Flank pit, 100 km north-west of Newman. The second high value project, led by Chevron and partners, is $1 billion worth of mining infrastructure as a part of the Gorgon Gas project. Tasmania, New South Wales and the ACT experienced increases in the value of mining project applications, totalling $157 million and $629 million respectively. In New South Wales, mining application values were pushed

up by the proposal of a 450 km Western Slopes Pipeline by APA Group, worth $500 million. The pipeline would deliver gas from the Narrabri gas project to the east coast grid, lessening dependence on interstate gas. The project application is currently being met with community resistance based on environmental concerns and a lack of local job creation opportunities . This may threaten the development, however a preliminary environmental assessment is yet to be submitted. IN CONSTRUCTION The value of mining projects moving into construction decreased dramatically from over $4 billion at the end of 2016, to $806 million in March 2017. The declines came from a reduction in large scale mining builds being established in Queensland and Western Australia. There were 57 mining-related projects that commenced in the March quarter, spread across Queensland, South Australia, Western Australia and the Northern Territory. As with the industrial space, the mining space this quarter was dominated by lithiumrelated mining. Engineering, procurements and construction for

the Pilgangoora Lithium-Tantalum Project commenced in December this year, totalling $57 million in construction value. In the Northern Territory, mining related construction is dominated by the Northern Gas Pipeline development, including establishment of controls, shipping infrastructure, system hardware and pipe parts, totalling $24 million in construction. In Queensland, approximately $88.5 million worth of projects are tied to the Amrun Bauxite mine, a mine being developed by Rio Tinto in Cape York. DEFERRED AND ABANDONED There were no mining construction project deferrals captured in the March 2017 quarter. The year to March 2017 only saw 1, $2 million project deferred in Western Australia. The project was investigating the viability of an open cut or underground mine, led by TNG Ltd. There were 5 mining related projects abandoned across Australia, including 4 projects in Western Australia totalling $15 million, and 1 $5 million project in South Australia.

1 Ferguson, K & Clift, J, 31st of March, 2017, â&#x20AC;&#x2DC;Pipeline worth $450m proposed to support controversial Narrabri Gas Project in NSWâ&#x20AC;&#x2122;, ABC News, accessed online at: http://www.abc.net.au/news/2017003031/pipeline-proposed-for-narrabri-gas-project/8404188

30 | Cordell Construction Market Movement Report, Q1 2017

NEW PROJECT PIPELINE

Number Value

Q1 2017

Q4 2016

YOY Change

253 projects

224 projects

13%

$5 billion

$2.73 billion

82.1%

IN CONSTRUCTION Q1 2017

Q4 2016

YOY Change

Number

57 projects

32 projects

78.1%

Value

$0.8 billion

$4.9 billion

–83.5%

ABANDONED & DEFERRED Q1 2017 Number Value

5 projects $20 million

Q4 2016

YOY Change

16 projects

–68.8%

$29 million

–29.8%

Cordell Construction Market Movement Report, Q1 2017 | 31

$148 million

Pilgangoora Lithium Tantalum Project PORT HEADLAND, WESTERN AUSTRALIA STATUS: CONTRACT LET Expected completion date: December 2017.

$50 million

Amrun Bauxite Project – Mine Infrastructure

$2 billion

South Flank Iron Ore Project

WEIPA, QUEENSLAND STATUS: CONTRACT LET

Expected completion date: August 2018.

NEWMAN, WESTERN AUSTRALIA STATUS: NEW PROJECT

Development of an additional ore deposit at South Flank to sustain production over the next 5 to 10 years as the Yandi mine is exhausted.

$60.4 million

Taronga Tin Project – Processing Plant EMMAVILLE, NEW SOUTH WALES STATUS: NEW PROJECT

Application is for the provision of a tin processing plant, which would process up to 2.5 mega0tonnes per annum. Ore is to be retrieved from a nearby open cut mine.

$134 million

Mount Morgans Gold Operations

LAVERTON, WESTERN AUSTRALIA STATUS: IN CONSTRUCTION Expected completion date: January 2018.

$100 million

Rogetta Iron Ore Project BURNIE, TASMANIA STATUS: NEW PROJECT

Environmental impact statement has been submitted for construction of a greenfield open0cut magnetite iron ore mine with a production rate of 1Mtpa with a proposed mine life of 8 years.

MINING PROJECTS IN FOCUS 32 | Cordell Construction Market Movement Report, Q1 2017

APPENDICES

New Projects Projects Entering Construction Deferred Projects Abandoned Projects

Cordell Construction Market Movement Report, Q1 2017 | 33

Number of New Projects Number of New Projects by Sector of Work 7,000

Number of New Projects

6,000 5,000 4,000 3,000 2,000 1,000 0

JUN 16

SEP 16

DEC 16

Mining

129

297

224

MAR 17 253

Industrial

433

484

418

Apartments & Units

1,731

2,013

1,694

1,927

Community

777

855

947

912

Commercial

504

595

580

541

Civil Engineering

1,427

2,089

2,091

2,058

Number of New Projects in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

611

565

312

227

459

122

Commercial

139

133

Community

213

241

184

174

Apartments & Units

402

834

202

147

Industrial

110

142

Mining

140

All Sectors

1,497

1,917

892

531

980

223

178

Change in the Number of New Projects by State

Change in the Number of New Projects by Sector MAR 16

MAR 17

Change

Civil Engineering

1,610

2,058

28%

Commercial

422

541

28%

Community

766

912

19%

Apartments & Units

1,383

1,731

25%

Industrial

430

418

–3%

Mining

253

247%

All Sectors

4,684

5,913

26%

Source: Cordell

34 | Cordell Construction Market Movement Report, Q1 2017

MAR 16

MAR 17

Change

NSW

1,335

1,497

12%

VIC

1,403

1,917

37%

QLD

763

892

17%

254

531

109%

626

980

57%

TAS

223

169%

220

178

–19%

All Sectors

4,684

6,218

33%

Value of New Projects Value of New Projects by Sector of Work

Value of New Projects ($millions)

50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

JUN 16

SEP 16

DEC 16

MAR 17

Mining

1,569

3,103

2,734

4,979

Industrial

1,388

1,879

1,589

1,407

Apartments & Units

15,832

11,630

12,353

11,317

Community

3,367

6,428

4,621

3,819

Commercial

3,920

4,520

3,709

3,449

Civil Engineering

8,671

9,495

18,683

11,701

Value of New Projects in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

5,034

1,735

1,974

904

1,635

269

149

Commercial

1,283

521

957

258

325

Community

917

1,075

957

164

629

Apartments & Units

4,766

2,742

2,590

312

733

147

Industrial

453

441

213

148

Mining

629

133

3,945

157

All Sectors

13,081

6,558

6,824

1,723

7,416

585

484

Change in the Value of New Projects by State

Change in the Value of New Projects by Sector MAR 16

MAR 17

Change

Civil Engineering

20,998

11,701

–44%

Commercial

3,382

3,449

Community

6,468

3,819

–41%

Apartments & Units

13,959

11,317

–19%

Industrial

1,770

1,407

–21%

Mining

3,198

4,979

56%

All Sectors

49,775

36,670

–26%

MAR 16

MAR 17

Change

NSW

11,220

13,080

17%

VIC

5,480

6,558

20%

QLD

8,502

6,824

–20%

16,226

1,723

–89%

7,178

7,416

TAS

796

585

–27%

373

484

30%

All Sectors

49,775

36,670

–26%

Source: Cordell *value in $millions

Cordell Construction Market Movement Report, Q1 2017 | 35

Number of Projects Entering Construction Number of Projects Entering Construction by Sector of Work

Number of Construction Projects

3,000 2,500 2,000 1,500 1,000 500 0

JUN 16

Mining

SEP 16

DEC 16

MAR 17

266

208

166

201

Apartments & Units

458

409

455

434

Community

540

426

417

512

Commercial

258

231

220

207

Civil Engineering

1,195

961

922

1,298

Industrial

Number of Projects Entering Construction in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

278

467

194

163

Commercial

Community

109

145

110

Apartments & Units

124

113

Industrial

Mining

All Sectors

597

852

461

203

401

108

Change in the Number of Projects Entering Construction by Sector MAR 16

MAR 17

Change

Civil Engineering

1,106

1,298

17%

Commercial

194

207

Community

419

512

22%

Apartments & Units

356

434

22%

Industrial

240

201

–16%

Mining

470%

All Sectors

2,325

2,709

17%

Change in the Number of Projects Entering Construction by State

Source: Cordell

36 | Cordell Construction Market Movement Report, Q1 2017

NSW

MAR 16

MAR 17

Change

506

597

18%

VIC

687

852

24%

QLD

343

461

34%

161

203

26%

412

401

–3%

TAS

108

117

–26%

All Sectors

2,325

2,709

17%

Value of Projects Entering Construction Value of Projects Entering Construction by Sector of Work

Value of Constuction Projects ($millions)

16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

JUN 16

SEP 16

DEC 16

MAR 17

Mining

644

705

4,882

Industrial

849

694

648

921

Apartments & Units

2,475

2,503

2,869

2,646

Community

1,834

1,729

1,796

2,535

Commercial

1,176

2,017

1,191

1,040

3,430

1,950

3,128

2,918

Civil Engineering

806

Value of Projects Entering Construction in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

841

1,222

624

227

139

Commercial

279

403

309

141

Community

686

446

340

143

Apartments & Units

851

617

894

136

299

Industrial

196

238

Mining

1,707

3,153

All Sectors

2,853

2,773

4,111

589

3,920

191

Change in the Value of Projects Entering Construction by State

Change in the Value of Projects Entering Construction by Sector MAR 16

MAR 17

Change

Civil Engineering

2,667

2,918

Commercial

1,131

1,040

–8%

Community

1,439

2,535

76%

Apartments & Units

1,865

2,646

42%

Industrial

857

921

Mining

806

803%

All Sectors

8,049

10,865

35%

NSW

MAR 16

MAR 17

Change

2,492

3,459

39%

VIC

1,200

4,590

282%

QLD

2,386

2,758

16%

591

373

–37%

838

1,842

120%

TAS

152

108

–29%

389

136

–65%

All Sectors

8,049

13,265

65%

Source: Cordell *value in $millions

Cordell Construction Market Movement Report, Q1 2017 | 37

Number of Deferred Projects Number of Deferred Projects by Sector of Work

Number of Deferred Projects

600 500 400 300 200 100 0

JUN 16

SEP 16

DEC 16

MAR 17

Mining

Industrial

Apartments & Units

212

196

182

195

Community

Commercial

Civil Engineering

Number of Deferred Projects in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

Commercial

Community

Apartments & Units

Industrial

Mining

All Sectors

104

142

Change in the Number of Deferred Projects by Sector MAR 16

MAR 17

Change

Civil Engineering

17%

Commercial

–22%

Community

32%

Apartments & Units

195

99%

Industrial

–46%

Mining

All Sectors

271

351

30%

Change in the Number of Deferred Projects by State

Source: Cordell

38 | Cordell Construction Market Movement Report, Q1 2017

NSW

MAR 16

MAR 17

Change

104

79%

VIC

–23%

QLD

142

82%

44%

–100%

TAS

–100%

All Sectors

271

315

16%

Value of Deferred Projects Value of Deferred Projects by Sector of Work

Value of Deferred Projects ($millions)

6,000 5,000 4,000 3,000 2,000 1,000 0

JUN 16

Mining Industrial Apartments & Units

SEP 16

DEC 16

MAR 17

113

189

190 2,388

3,033

2,394

1,613

Community

662

349

184

216

Commercial

1,265

932

665

391

472

122

335

237

Civil Engineering

Value of Deferred Projects in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

185

Commercial

285

Community

101

Apartments & Units

723

679

836

118

Industrial

153

Mining

All Sectors

1,045

726

1,389

144

Change in the Value of Deferred Projects by State

Change in the Value of Deferred Projects by Sector MAR 16

MAR 17

Change

Civil Engineering

779

237

–70%

Commercial

1,023

391

–62%

Community

135

216

60%

Apartments & Units

678

2,388

252%

Industrial

190

114%

Mining

All Sectors

2,707

3,422

26%

MAR 16

MAR 17

Change

NSW

1,207

1,045

–13%

VIC

468

726

55%

QLD

656

1,389

112%

144

1389%

301

–77%

TAS

–63%

170%

All Sectors

2,707

3,422

26%

Source: Cordell *value in $millions

Cordell Construction Market Movement Report, Q1 2017 | 39

Number of Abandoned Projects Number of Abandoned Projects by Sector of Work

Number of Abandoned Projects

800 700 600 500 400 300 200 100 0

JUN 16

SEP 16

DEC 16

MAR 17

Mining

370

Industrial

Apartments & Units

132

122

132

Community

Commercial

Civil Engineering

Number of Abandoned Projects in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

Commercial

Community

Apartments & Units

Industrial

Mining

All Sectors

130

Change in the Number of Abandoned Projects by Sector MAR 16

MAR 17

Change

Civil Engineering

23%

Commercial

17%

Community

34%

Apartments & Units

130

132

Industrial

–13%

Mining

–55%

All Sectors

304

327

Change in the Number of Abandoned Projects by State

Source: Cordell

40 | Cordell Construction Market Movement Report, Q1 2017

MAR 16

MAR 17

Change

NSW

130

81%

VIC

118

–44%

QLD

–13%

93%

43%

TAS

–20%

133%

All Sectors

304

326

Value of Abandoned Projects Value of Abandoned Projects by Sector of Work

Value of Abandoned Projects ($millions)

4000 3500 3000 2500 2000 1500 1000 500 0

JUN 16

SEP 16

DEC 16

MAR 17

Mining

593

Industrial

107

445

1,285

549

1,013

Apartments & Units

Community

183

194

Commercial

110

183

209

300

2,771

726

899

Civil Engineering

Value of Abandoned Projects in the March Quarter of 2017 NSW

VIC

QLD

TAS

Civil Engineering

828

Commercial

152

Community

138

Apartments & Units

827

Industrial

Mining

All Sectors

1,977

147

196

Change in the Value of Abandoned Projects by State

Change in the Value of Abandoned Projects by Sector MAR 16

MAR 17

Change

Civil Engineering

792

899

13%

Commercial

328

300

–9%

Community

194

355%

Apartments & Units

423

1,013

139%

Industrial

109

–46%

Mining

–52%

All Sectors

1,738

2,485

43%

MAR 16

MAR 17

Change

NSW

890

1,977

122%

VIC

358

147

–59%

QLD

415

196

–53%

277%

55%

TAS

–52%

159%

All Sectors

1,738

2,483

43%

Source: Cordell *value in $millions

Cordell Construction Market Movement Report, Q1 2017 | 41

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