Citimark Properties gains funding for $200 million Surfers Paradise building

Citimark Properties has gained funding for its $200 million Markwell Residences project in Surfers Paradise.

Located just 180m from the beach, Markwell Residences will the largest residential tower to be built in Surfers Paradise in more than eight years.

Citimark, based in Brisbane, has secured an offshore senior debt funding facility and has appointed Hutchinson Builders to begin construction of the 46-level, 210 apartment tower in the New Year.

Citimark Properties joint managing director Angus Johnson said the apartment and retail project was now 75 per cent sold after reaping the combined benefits of limited supply, high demand, increased infrastructure investment and the competitive advantage of being an established local developer.

Johnson said Australia’s constrained development finance market with Australia’s major banks had made projects of this scale difficult to get off the ground, particularly for private developers.

“The shortage of finance has impacted significantly on new supply despite very evident demand and the Gold Coast having one of the highest population growth projections in Australia,” he said.

“Citimark has a long track record with all four major trading banks and for the first time in our history, we did not approach any of them to fund the construction of Markwell Residences.

“We believe the Gold Coast is fundamentally one of the strongest markets in Australia with a significant undersupply, growing population and more than $12 billion in private and public infrastructure investment in the immediate region.”

The project’s funding was arranged by James Walsh, National Director of Deloitte Real Estate in Australia, who said the Markwell Residences project was attractive to financiers for a unique combination of reasons.

“There is a significantly low supply of new projects actually being constructed in the central Gold Coast region,” Mr Walsh said.

“This is reflected in the record low residential vacancy rate across the Gold Coast which was recently estimated at 0.9 per cent and the lowest of Australia's largest six cities.

Citimark Properties joint managing director Robert Pullar said Markwell Residences presented a unique competitive opportunity.

“The funding proposal took advantage of the current favourable market fundamentals which outrank other Australian east coast capital city markets, while partnering with a leading private Australian developer with a demonstrated 30-year-plus track record of successful projects,” he said.

“Appointing a top tier builder with a strong track record and national exposure was also a key component in securing a competitive and favourable senior debt funder.”

“Hutchinson Builders are Australia’s largest privately owned building company and we have partnered with them for over 30 years,” Mr Pullar said.

“The track record between our two companies added a lot of value to the Markwell project funding program.”

Johnson said interest from the Australian market had been integral to the project’s sales success with most sales sourced from local and Sydney-based agents.

“We purchased several sites on the Gold Coast ahead of the current cycle because we understood the impact of these fundamentals,” he said.