Family-sized apartment strategy outlined by the highly profitable Central Equity
One of Melbourne's most prolific private developers, Eddie Kutner's Central Equity, has recorded a record $131 million profit for the 2016 year.
Central Equity's 2015 profit was $10 million. In 2014 the profit was $76 million.
Kutner and his partners John Bourke and Dennis Wilson are considering a potential sell-down or outright sale of the business they founded in the 1980s.
"Central Equity is a highly profitable and sustainable business that has been developed over more than three decades to become a 'second generation' enterprise," a spokesman said on Monday.
The 2016 profit was achieved on $586 million in sales revenue, compared to $120 million in the previous year.
Central Equity also develops residential land lots and has a project in Queensland.
In the directors' report for its 2016 financial results, obtained by The Australian Financial Review, the company outlines the prospect of strong revenues ahead, with more than $1 billion in sales contracts in hand.
Its Southbank Place in Kavanagh Street, which was released earlier this year, is expected to generate more than $400 million in sales.
Central Equity also noted it had acquired a major site on Lonsdale Street.
Central Equity's annual report addresses concerns about Melbourne's over-supply potential.
"Large-scale projects can take five-10 years to complete and over these timeframes many projects are either delayed or abandoned," it said.
"Accordingly, long timeframes, delay or abandonment and the dynamics of off-the-plan sales and bank requirements, have a 'self-regulating" effect on the physical supply of completed apartments to the market."
Central Equity also noted it is boosting the proportion of "family-sized apartments" in its projects, including larger two-bedroom units and more three-bedroom apartments.