Just when the sun had started to peek through, the number of cranes dominating the skyline of capital cities has risen, with a record 685 structures around the country.
This is an increase of 19 steel giants from the last recorded number in April this year, according to the Rider Levett Bucknall fourth-quarter 2017 RLB Crane Index, released this week.
It proves the construction boom shows no sign of abating.
There are 350 in Sydney, 151 in Melbourne and 116 in Brisbane and the Gold Coast combined. In Sydney there are 109 Sydney suburbs with residential cranes and 54 suburbs in Melbourne.
Cushman & Wakefield’s research team has estimated there is $62 billion of development in Sydney alone, of which about $50 billion is in infrastructure projects. And with more roads, commercial, hotel, residential and retail developments in the wings, the need for cranes will remain high.
John Sears, national director research, Cushman & Wakefield, said an unprecedented development boom is set to drive the Sydney CBD and its office market in particular over the next decade.
“The Sydney CBD is currently experiencing a relatively subdued period of office development, with no significant new developments until 60 Martin Place in 2019 and Wynyard Place in 2020,” he said.
“Following these developments, Sydney’s next supply cycle is due to begin in earnest from 2021 with significant proposed developments including Quay Quarter Tower at 50 Bridge Street, Circular Quay Tower at 180 George Street and Darling Park 4.”
Lendlease, Investa Office and AMP Capital are embarking on the big developments at Martin Place, Barangaroo and Circular Quay, while Brookfield Property Partners are underway with the $1.9 billion Wynyard project.
According to RLB’s index, the boom is not contained in NSW, as there has been a crane count increase in every key city across Australia, except Darwin and Canberra.
As expected, the residential sector remains the busiest, with a record level of 177 cranes in the fourth quarter of 2017.
The non-residential index, which includes all sectors other than residential, shows more volatility, but still highlights a positive trend.
The index currently stands at 111 up from 101 in the second quarter of 2016. These sectors are more volatile to large fluctuations in crane starts due to the smaller investor base for new developments and traditionally a single-purpose use.
Stephen Ballesty, RLB’s director of research & development, said a stable non-residential sector is important to the industry as a whole, as it showcases new investment and confidence in both government spending on social infrastructure assets and the private sector’s spend on long-term investments for new office, recreation and retail assets.
“Since our last index six months ago, there has been a move of cranes from the south to the east and west, highlighting the growth of higher density residential projects within these regions,’ Mr Ballesty said.
“The residential, hotel, civil, education and other/mixed use sectors all are showing strong growth in crane numbers with the remaining sectors all showing small losses of cranes since the last index.”
The hotel sector has begun an upward trend with significant investment across the country, with 11 new cranes observed. These are mainly in Sydney’s Darling Harbour precinct with the Sofitel opening next week and The Star getting ready to begin construction of the Ritz-Carlton next to the casino.
In Melbourne Cbus snapped up the Mercure hotel to build a ritzy residential tower.
The other/mixed use sector has emerged over the past year, with significant developments starting in Brisbane, Melbourne, Perth and Sydney. Mixed-use projects include Queens Wharf in Brisbane, Collins Arch and West Side Place in Melbourne and Elizabeth Quay in Perth.
Mr Ballesty said RLB Crane Index has recorded a 3 per cent increase in Melbourne.