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Listed property developer Devine Limited (ASX: DVN) has announced the acquisition of a 21.45 hectare land parcel in Brookfield, 35 kilometres south west of Melbourne, for $6.9 million in an 18 month staged settlement contract.
Once approved and fully developed the project will have an estimated end value of $80 million.
The purchase reinforces the company’s aggressive acquisition strategy in Victoria, where it has purchased seven land parcels in the past 12 months in transactions totalling more than $117 million.
The Brookfield site is strategically located in an area which has become the focus of a $15 billion urban investment strategy initiative by the Melton Council.
Backed by the Victorian Government’s Melbourne 2030 strategy, the initiative has identified Melton as a major new investment location for Victoria – a commitment that will create a new city of up to 100,000 people over the next
two decades.
Devine founder and Managing Director, David Devine, said the company’s expansion in Melton was well positioned to take advantage of the strong growth planned for the region.
“Melton will be a showpiece for 21st century urban design. Over the next 25 years, the region will become a hub of major new development, including 37,000 homes and an estimated $6 billion investment in business,” he said.
“Our strategic expansion in this area reflects our commitment to developing communities where there is good surrounding infrastructure and amenities and an affordable entry price for home buyers into the residential market.”
Following the transaction Devine will control a land bank equivalent to 3,850 residential lots in Victoria.
“We are well on our way to achieving our target forecasted land bank of 10,000 blocks nationally by mid 2010,” Mr Devine said.
Devine’s General Manager Victoria, Luke Hartman said the Melton Council’s urban development plans would boost the region’s already strong population growth.
“Figures from the 2006 Census show population growth in Melton of 9 per cent per year over the previous five years - an increase of approximately 26,625 people,” Mr Hartman said.
Population projections undertaken by the Victorian Government forecast the Melton population to grow by a further 56,416 people between 2006 and 2016.
Mr Hartman said Devine’s site is conveniently located close to community amenities and schools, including Melton Secondary College, Melton Christian College, Catholic Regional College, Coburn Primary School and St Catherine’s Primary School. Victoria University is located within two kilometres.
The site is also located in close proximity to the Woodgrove Shopping Centre, a Bunnings Warehouse and a new proposed shopping centre precinct.
The Melton area is well serviced by local transport infrastructure, including the nearby Melton Train Station. The new Deer Park Bypass, which is due to be opened in early 2009, will reduce travel time from Melton to the Melbourne CBD by up to 15 minutes.
Mr Hartman said Devine will continue to investigate opportunities in Victoria to further grow the company’s residential development workbook.
Last month (25 January 2008) Devine announced the $136 million pre-sale of its first hotel development, located at 131-135 Bourke Street in Melbourne, to Singapore-based international hotel owner-operator The Ascott Group.
Devine has a current national pipeline of land developments and projects which, when completed and sold, will have an end value exceeding $3 billion.
On 29 August 2007 Devine announced an after tax profit of $21.367 million for the 2006-07 year, 13.2 per cent up on the previous year’s result.
The company’s December 2007 half-year results are expected to be in the range of 15 to 20 per cent above the $6.987 million profit after tax result recorded for the same period in 2006.
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