A research-directed redesign of the site masterplan and a new tenancy plan were two of the key factors which have allowed Logan City’s new Southwest Medical Precinct to pass critical feasibility tests and head for construction start in early 2021.
Just 200 metres from the Logan Hospital, adjacent to the Meadowbrook Shopping Centre in Logandowns Drive, the 2,200 square metre medical precinct was initially deemed unfeasible due to layout and design issues impacting cost. However, working closely with the landowner and architect, DMA Partners was able to restructure the project and secure a high-value anchor tenant, UQ Health Care.
The result was a three-fold increase in land value. A very pleasing result for the client, a family owned investment group.
DMA’s Matt Cummins said at the core of the feasibility issue was the cost of incorporating above ground carparking ineffectively, which detrimentally affected tenancy layouts, leasing opportunities and added significant additional cost.
“A considered tenancy layout can add significant value. Carparking is a substantial development cost and can make or break development feasibility, as was the case here.
“We saw a significant flow on benefit to the neighbouring shopping centre if our project could proceed, and on that basis we were able to negotiate an access agreement with them.
“We were then able to restructure the carparking needs of our project, and improve the capital value by increasing the attractiveness of the layout from a tenant’s point of view. This eliminated significant development cost and effectively tipped the scales on our cost benefit analysis.”
The agreement reached with the centre was a win-win because the major medical centre tenant, UQ Health Care is expected to draw 100,000 patients per year to the area, which is clearly a large benefit to the retail centre.
Client Ben Horwell said it had been some time since his family group had undertaken development projects and the decision to engage a specialist was designed to minimise risk and provide confidence in a positive outcome in an uncertain market.
“DMA really brought several capabilities that have been central to project success.
“Their advice on the state of the market and tenant requirements shaped the re-design.
“Also, their capacity to negotiate excellent commercial terms has allowed us to be confident that we’re getting real value for money from our consultants and contractors.
“Very early on we realised we could have confidence that they’d follow through on all of the detail…and here we are ready to turn the sod.”
Project: Southwest Medical
Address: 12-16 Logandowns Drive, Meadowbrook, Queensland
Asset Value: $20 million
Project Status: Construction commencing early 2021. Completion due mid-2021.
Anchor Tenant: UQ Health Care
Now Leasing: Minor tenancies
GLA: 2,200 sq m