Mirvac to pull forward Harold Park project sales and construction: Goldman Sachs

Mirvac could pull forward sales and construction at its Harold Park project in Glebe after strong sales from the first two releases, according to a Goldman Sachs report.

Analyst Simon Wheatley’s report on Harold Park says stage 3 could be released ahead of timetable after pre-sales on stage one and two were strong with sales prices “potentially slightly ahead of feasibility”.

The report says around 90% of stage one is sold and 70% of stage two with recent sales numbers accelerating.

“Consequently, we believe that the release of stage 3 could be fast-tracked and may be brought to the market imminently,” Wheatley says.

He says pulling the project forward could result in a plateau in earnings for Mirvac after project completion but they are willing to take the risk because “the ducks are quacking”.

“Demand is strong at Harold Park currently and the release will be timed to meet this demand,” Wheatley says.

He says Mirvac are worried if they don’t pull the project forward they might be left with excess stock if the property market suddenly weakens.

Given the success of the Harold Park and Chatswood Era projects, Wheatley says Mirvac’s profits will likely be higher than previously anticipated.

Wheatley says Mirvac hope to achieve an earnings before interest and taxes figure on the project of more than $200 million.

He puts the total end value of the project, which he was given a tour of by Mirvac, at $1.2 billion.

In March more than 300 people attended the weekend launch of the project in Glebe.

One-bedroom apartments started at $525,000.

There were 27 one-bedders on offer ranging from 50 square metres to 75 square metres; 33 two-bedders (75 to 100 square metres) from $830,000; five three-bedders (105 to 125 square metres) from $1,325,000 and nine three-bed terraces (165 to 180-square metres) from $1.74 million.

The priciest offerings were $1.895 million four-bedroom terraces.

Mirvac is transforming the former Harold Park Paceway into a $1 billion-plus infill housing development.

The Harold Park master plan allows for 1,250 dwellings with a 208,000 square metre network of landscaped parks.