Monday, March 21, 2016

Millers Point 2 years on - projected windfalls

The 2 year anniversary of the announced sale of public housing in Millers Point was observed on Saturday March 19th 2016.


Over the past two years, 323 of the 398 Millers Point properties earmarked for sale have been vacated.

58 of these properties have been sold for a total of $150million, with a median price of $2.4million. A further 13 properties are listed for auction for an expected $35.1million to $36.6million, with a median price range of $2.6million to $2.7million (see

The Government has deferred the sale of 28 properties, which it has set aside for some remaining residents. The Sirius Building comprises 79 units and it is expected that it will be sold as one. This leaves 221 properties still to be placed on the market, as well as the Sirius Building.

Some properties have been divided as flats or boarding houses in the past, but will be sold as single dwellings, so the number of properties left to be sold may be less than 221. Even so, if future sales continue to bring in expected prices, the NSW Government can expect to raise a further $570million or more from these properties.

The Sirius Building conservatively would raise $50million.

This means that, in total, the NSW Government can expect to reap more than $800million in today's dollars. This is a huge windfall, but it comes at a massive cost. It has reduced the "social-mix" within this iconic and historic inner-Sydney community. And to the former and current residents of the 398 affected properties, it is particularly harsh - especially the many older and long term residents of the area.

We understand that as of 20 March 2016 56 tenancies remain on foot, where the tenant has not been relocated, is not in the process of being relocated nor has been approved for one of the 28 properties in Millers Point set aside for remaining tenants.

So, just reflecting on that figure of $800+million...

If the NSW Government converted the Sirius Building to strata title, and then sold 39 of the 79 individual units (varying bedroom sizes) at an average of $1.5million each, they would still obtain their windfall of $800+million plus retain 40 of the units in the Sirius Building for social housing.

If they withdraw 20 of workers flats from the sale at an average of $1.5million each and 10 of the terraces at an average of $2.5 million each, they would still make a windfall in excess of $750million. This would retain a further 30 properties for social housing and also allow some of the older residents to remain in their existing dwellings and age-in-place.

Current conditions suggest the NSW Government could achieve $750million in sales, while retaining up to 70 dwellings to allow the remaining tenants to stay in Millers Point.

1 comment:

  1. The NSW Government's target is sales reaching $500 million which is re-invested into some 1500 new social housing dwellings.

    Check Brad Hazzard's media release dated 17 April 2015 at: It reads 'The projected proceeds from the Millers Point property sales, expected to be about $500 million – will be re-invested into some 1500 new social housing dwellings'. His more recent media release dated 20 January 2016 says the same thing. Check it also at:

    Now see NSW Department of Finance, Services and Innovation's media release dated 31 March 2016 at: It states that, to date, 70 properties have been sold in Millers Point, totalling $182.73 million and the 590 new, fit-for-purpose social housing dwellings have been funded to date. If this figure of $182.73 million is the amount that covers the cost of the 590 social housing dwellings funded to date, then 1,500 properties will cost around $500 million ... exactly what the earlier media releases state.

    A reasonable estimate is that the sale of Millers Point properties may raise as much as $811 million. This is far more than the $500 million the NSW Government has earmarked for the 1,500 new social housing dwellings.

    The sale of housing stock has proved itself to be a goldmine for the NSW government. Yet it remains intransigent on providing the remaining older residents a real choice. This would allow ageing-in-place for residents in their current homes, as well as retaining some of the units within the Sirius Building and workers cottages to maintain a semblance of a social mix in Millers Point.

    Come on NSW Government, you can do better than this! You will easily reap $500 million, even with those residents who remain at this point in time staying. Let's make this a win-win situation!