Stockland turns first earth at Willowdale
Stockland has moved a step closer to finalising plans for its $1 billion residential development at East Leppington, with the land release to be branded and marketed as Willowdale at Denham Court.
Plans include the building of about 3000 dwellings, mainly homes, in a scheme that includes a primary school, neighbourhood shops, sports fields, open spaces and recreational areas.
The development will be located about 1.5 kilometres from Leppington train station, which will form part of the new south-west rail link due for completion in 2016. Willowdale is 15 kilometres from Liverpool, about 37 kilometres from Parramatta and Sydney Airport, and has access to the M5 and M7 motorways.
Stockland chief executive Mark Steinert, who took over the reins in January, has said residential would remain a key plank in the group's business.
Although he warned at the half-year results in February that there would be a one-off $306 million impairment covering only 13 residential projects, he has now restructured that division. Mr Steinert said the impairment did not include the master-planned assets, such as East Leppington and Marsden Park, and Highlands at Craigieburn in Victoria, which are on schedule and budget.
The new chief executive of Stockland's residential business, Andrew Whitson, said Willowdale would address housing affordability in Sydney's south-west by providing greenfield lots, with customers free to choose their own builder.
Mr Whitson said last week that Campbelltown and Camden councils had approved the start of bulk earthworks at the 350-hectare site, which is bordered by Camden Valley Way, Denham Court Road and St Andrews Road.
Morgan Stanley analysts said it was all about execution for Stockland. "The new chief executive [Mark Steinert] has done a relatively good job of addressing key investor concerns around strategy, carrying values in residential and management. After raising new equity in May, the key for Stockland now is delivering (or outperforming) on expectations," Morgan Stanley said in a statement.
"We see 2014 as the first step toward rebuilding momentum. After two-plus years of multiple earnings downgrades, asset impairments, an unpopular strategy and significant relative underperformance, we see 2014 financial year as an opportunity to deliver positive earnings momentum and build a base for further growth in 2015 and beyond."
Mr Whitson said the lots at Willowdale would range from 350sq m to 600sq m, with prices starting at $229,000. The first settlements are expected next June and the first homes should be completed and ready for the first residents to move in by Christmas 2014.
"It will be our biggest and, arguably, our best new residential community in NSW," Mr Whitson said.
"New home owners at Willowdale will benefit from the multibillion government investment in new rail and road upgrades, connecting home owners and families to local employment centres, educational facilities, shopping centres and nearby recreational areas."