Apartment developer spends $60m on land

City apartment developer Francis Kwong is branching into the wholesale land market, spending $60 million to buy the sprawling Eynesbury residential estate in Melbourne's west.

Villa World sold its half stake in the 500-hectare subdivision to Hyde Property Group, which is controlled by Francis Kwong and Mathew Thomas Phillip. Mr Kwong is the sole shareholder.

Industry sources say the deal is being backed by a Singaporean and Malaysian investment syndicate.

Hyde Property Group will partner Woodhouse Pastoral in the development of the remaining 3550 lots of the 4500-lot subdivision, which includes ownership of the Eynesbury golf course.

It marks the second-biggest transaction for the wholesale land market this year, after the Victorian government sold a planned 2000-home subdivision site of 125 hectares along Hacketts Road in Werribee to Perth-based Satterley Property Group for $103 million.

Oliver Hume development and sales executive Robbie Demian, who negotiated the Eynesbury deal, said it was a positive example of the growing interest in the greenfield market. "The numbers this year are reflecting a rise in sales and demand for residential lots in the growth corridors," he said.

Frank Nagle of Biggin Scott said international and interstate buyers were particularly active in the market.

These large-scale deals come as affordability continues to improve in the retail land market.

The price of a block of land fell from $205,000 to $201,250 in the June quarter, according to Oliver Hume. After including the average developer incentive of $12,500, the net land price is now only marginally above the pre-boom level at $188,750.

Hyde Property Group did not respond to a request for comment. Mr Kwong's previous development venture, Barton Australia Group, was placed into external administration in early 2012 with debts estimated at $14.7 million, according to documents filed with ASIC.

cvedelago@theage.com.au