A joint venture to develop the new town of Googong south of Queanbeyan could help ease pressure on land prices in the ACT region which are the highest in Australia.
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Major real estate group Mirvac's partnership with Canberra-based residential developer CIC Australia follows the Joint Regional Planning Panel approval on Monday of Googong's first 337 lots.
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An average block in the ACT is $500 per square metre according to CBRE valuer Marcus Hon, about $50 to $70 more expensive than in Melbourne, Sydney and Brisbane.
Queanbeyan has been landlocked for years and Googong, a town of 5500 homes for 16,000 people, will take some heat out of the market in Queanbeyan, Jerrabomberra and Tuggeranong.
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''It will certainly give the punters out there more choice. What it does to land prices is hard to say, it's 12 months away before they start building,'' Mr Hon said.
CIC chief executive Col Alexander said he was keen to get an initial group of home owners into Googong by offering prices well below ACT greenfield suburb Molonglo's average price of $500,000.
Block sizes in Canberra have been reduced as the Government struggles with housing affordability which handicaps the territory's economy.
Googong's average block size will be 570sqm.
One of four multi-nationals to respond to CIC's expression of interest for a joint venture, Mirvac will be a 50/50 partner in Googong which is expected to turn over $1.7billion during the project's 25 year timeframe. Googong will create an average of 560 jobs a year, beginning early in 2012 when work begins on the first two stages. Residents are expected to move there in 2013.
Mirvac has a large office portfolio in Canberra after buying the Snow family's ACT property trust years ago.
Mirvac's Brett Draffen said Googong was the company's first residential development in the Canberra market.
''The Googong township is poised for significant growth as it represents sustainable community living in close proximity to Canberra's CBD.''
CIC is in joint ventures at Forde and Crace. It built the Ambassador apartments in Deakin and has been planning Googong for a decade.
Mr Alexander said the joint venture option arose as the company refined costings, feasibilities and infrastructure requirements.
One company had sought 100per cent of the development, but Mr Alexander said selling 50per cent was a hard enough decision.
''We wanted to spread the risk and give it double the capital backing that it needs from us and with Mirvac, it just means we can really get stuck into it. At some stage the ACT Government is going to run out of land, whereas Googong is going to be there for 20 years and if the ACT does run out of land Googong's lifespan may contract and finish earlier.
''I think if we got a very fast train Googong's lifespan would be cut in half and as a developer we would be delighted, obviously.''
He said the ACT's drive for higher densities and urban infill made Googong more attractive for people who wanted a ''block of dirt and backyard for the kids.'' Environment and Sustainable Development said yesterday the ACT would not run out of greenfield land in the next 25 years.