Construction is under way on Morris Property Group's One City Hill development.
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The first sod was turned on the Canberra city development on Monday morning by Morris Property Group director Barry Morris and senator Zed Seselja.
The construction is for the first stage of the project and includes 325 residential apartments, 750 public car spaces, 500 resident car spaces and 600 square metres of retail space.
Prior to the sod turning, the site served as a car park.
It is estimated to cost $500 million, as per the development application submitted to the National Capital Authority.
"This is a significant milestone for the project. We're thrilled to formally mark the commencement of works in what will be one of Canberra's most iconic residential developments," said Mr Morris.
Mr Seselja described the development as "really significant for Canberra".
"It is great that we are seeing the growth of our city," he said.
"This is going to be an amazing precinct and I'm sure over the coming years we are going to see some extraordinary things here."
The Section 100 site, formerly known as Block 12 Section 63, sat in limbo for more than 10 years before Morris Property Group purchased it for $85 million in 2018.
Mr Morris highlighted the "tumultuous history" of the site in his speech.
In 2007, the ACT government sold the 2.6-hectare site to Mirvac for $93 million. The site was to be developed over seven years in a joint venture with Leightons.
The companies planned a $755-million development for the site, but it was reported in The Canberra Times that plans were delayed in the wake of the global credit crisis.
In his speech at the ceremony, Mr Morris took aim at the ACT government's tax reforms.
"No commercial property owner that I know of or land developer will shy away from making their contribution to the city, and their contribution towards schools, health and education," he said.
"However, a 200 per cent increase which is then only coupled with a 30 per cent reduction in stamp duty is somewhat of a big ask in my opinion.
"Certainly a lot needs to be said for leakage out of the ACT government coffers."
The development has one, two, three and four-bedroom apartments. The entire site could yield up to 1200 apartments.