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Western Sydney Infrastructure Boom and Investment Opportunities - June 2024

June 20, 2024 / Written by Terry Ryder

 

By Guest Blogger, Terry Ryder, founder,

hotspotting.com.au and propertyU

 

The power of infrastructure in generating growth in residential property markets is a core plank in the Hotspotting philosophy.

Markets with infrastructure developments in their midst benefit from the economic activity and jobs that are generated. Major transport infrastructure projects are particularly influential.

There are few stronger examples anywhere in Australia than the Western Sydney Western Sydney Airport and the associated Aerotropolis, which is destined to become an economic powerhouse amid the dynamic Western Sydney economy.

The regions surrounding the airport at Badgerys Creek are set to benefit from this massive infrastructure spend. Housing markets in the municipalities of Liverpool, Blacktown, Penrith, Campbelltown and Camden will all feel its impact.

The infrastructure being created is not only an international airport. There’s the associated road and rail links, the commercial-industrial businesses that will be established in the vicinity and the wider development of community facilities.

At the centre of this development revolution is the $5 billion Northern Gateway. The Northern Gateway is a planned city featuring an international university and education precinct, wellness and healthcare centre, Westfield retail entertainment precinct and a hi-tech logistics hub.

This constitutes a massive new employment node and the availability of job opportunities will drive solid demand for housing accommodation nearby.

Billions are being spent on road and rail infrastructure to cater for growing population in this precinct and nearby regions – for example, a Liverpool City Council population that is predicted to swell to around 440,000 by 2041.

Suburbs strategically located near the airport development are likely to benefit from the evolution of this precinct through rising property prices. Relative affordability has made the region popular with first-home buyers and home real estate consumers.

The rural land in Badgerys Creek was declared the site of Sydney’s second airport by the Hawke Labor Federal Government in 1986 in an area where the local population (Badgerys Creek in 2016) was only 225 people.

The Western Sydney Airport was finally approved in 2014 and construction got underway in 2018. More than 25,000 people are being employed during the construction stage.

The site is part of the Liverpool City Council region, which is one of the key commercial centres of metropolitan Sydney – the Liverpool CBD includes shopping centres and Liverpool Hospital - the largest tertiary health facility in NSW - along with TAFE NSW and two university campuses.

There are strong transport links to the Sydney CBD, northern suburbs and southern suburbs.

But most importantly, Badgerys Creek falls within the new Western Sydney Airport Growth Area which is destined to become an economic powerhouse comprised of:

  • An airport forecast to eventually take 82 million passengers a year, twice the number currently serviced by Sydney Airport at Mascot.
  • A business precinct called the Aerotropolis which includes the $5 billion Sydney Science Park.
  • The $5 billion Penrith Health and Education Precinct.

Population growth will be the major factor impacting suburbs around the airport.

The population of Greater Sydney is expected to grow to 6.2 million by 2036. The Liverpool LGA can expect to grow by an additional 100,000 residents to reach 331,000 residents in the same period.

New communities are planned for Oran Park, Turner Road, East Leppington, Austral, Leppington North, Edmondson Park, Catherine Fields and South Creek West under the State Government’s South West Growth Area Plan. Some of these emerging suburbs are in the Camden, Campbelltown and Blacktown LGAs.

Extensive tracts of land are being released in stages, with Austral and Leppington earmarked for 17,000 homes. Several residential estates are underway in the general vicinity of Badgerys Creek.

In the wake of the pandemic, Federal and State Government have sought to generate economic recovery by fast-tracking infrastructure spending, and the Western Sydney precinct based around the new airport is a key area for that.

It is expected that once the airport, associated transport links and the commercial-industrial precincts evolve, property values in this precinct will rise strongly.

Urban Development Institute of Australia NSW chief executive Steve Mann expects the first wave of changes would occur in and around Liverpool, Campbelltown and Penrith, which he says will provide the broader supply of necessary housing.

Western Sydney is Australia’s third-largest economy, housing almost half of Sydney’s total population and producing 31% of Sydney’s Gross Regional Product. At around $104 billion, it represents 8% of the national GDP.

Over the past decade the Western Sydney population has grown faster than the rest of Sydney and is likely to continue to do so - given the availability of land for new communities and the drawcard provided by the new airport.

When it opens in 2026, the new airport will be able to handle 10 million passengers per year and is designed to eventually cater for 82 million passengers per year by 2060.

The earthmoving and excavation for the airport is reportedly the nation’s largest project since the Snowy Mountain Scheme commenced in the late 1940s.

Lendlease has secured the $644 million major earthworks contract and construction of the terminal is now underway.

Plans include a 3,700m runway capable of accommodating planes of all sizes, while a 3km transport tunnel has been earmarked for a future underground rail link to the airport.

The final stage will be a major international airport complex. Eventually, it is expected that the South West Rail Link will extend to Badgerys Creek and on to St Marys, where it would connect with Western Line services and south to Narellan.

“The Western Sydney Airport is more than just a landing strip and a terminal - it will be a business destination in its own right,” said Ross Grove, the Property Council’s Western Sydney regional director.

“The airport’s masterplan earmarks 191ha of premium airport land surrounding the airport’s second metro station for a business park integrating office, retail, industrial, hotel and conference facilities.”

In March 2023, NBN Co and Western Sydney Airport Co signed an agreement to establish a new Business Fibre Zone at the new airport, which will involve the installation of 25km of fibre to service the airport terminal and future business park. The investment will ensure more than 1,000 local businesses and premises reap the rewards of high-speed broadband.

The airport precinct will be known as “Aerotropolis”, providing 60,000 homes and 200,000 jobs, according to the NSW Department of Planning. Aerotropolis includes the $5 billion Sydney Science Park and the $5 billion Penrith Health and Education Precinct.

The project will focus on advanced manufacturing, agribusiness, education, housing, healthcare and pharmaceuticals. Rezoning of 6,500ha surrounding the airport was approved in 2020, paving the way for development of the 10 precincts to begin in earnest.

The first five precincts will deliver much-needed job growth to Western Sydney, providing the potential for 100,000 new jobs and homes to accommodate 30,000 new residents.

So residential property markets in neighbouring municipalities will be boosted.

To support the massive development the NSW Government is fast-tracking rezoning and development approvals.

With Liverpool set to accommodate 440,000 people by 2041, a total of 27,000 dwellings are planned for new-release areas in the next two decades. Of these, 17,500 are planned for Austral and Leppington North alone.

A new town centre and 25,000 homes are to be built in Edmondson Park, and 3,000 homes are being built in Bonnyrigg.

The precincts will be known by several names. They include the Aerotropolis Core, Badgerys Creek, Northern Gateway, Agribusiness and Wianamatta-South Creek.

The Federal Government is investing $3 billion over 10 years in major infrastructure upgrades in the precinct. In support of all the planned residential projects, numerous road upgrades will be carried out.

These include improvements to the Camden Valley Way and Bringelly Road, while a $1.2 billion upgrade of Northern Road has been completed. There is now a minimum of four lanes from Narellan to the M4. The Werrington Arterial Road has also undergone $70 million worth of improvements.

Construction of the M12 motorway between Cecil Hills and Luddenham started in 2022, with the $2 billion project connecting the new airport to Sydney’s motorway network. The M12 is expected to create 2,000 direct and indirect jobs by the time it opens in 2026, in time to service the new airport.

A network of rapid bus connections is also being planned and will create additional public transport opportunities around the new airport. The $1.6 billion project includes bus links from Penrith, Liverpool and Campbelltown to the airport and the new city of Bradfield.

The largest element of the project is the Fifteenth Avenue Smart Transit Corridor, a $1.2 billion project that will see fast electric buses use dedicated lanes between Liverpool CBD and the new airport.

Work on a rail link to connect the airport to the rest of the city is well underway, with the 4.3km tunnel to St Mary’s Station half completed by February 2024. The project will cost $11 billion and create 14,000 jobs by the time it is completed in 2026. It includes six proposed metro railway stations.

This massive infrastructure spend bodes well for property investors looking catch the wave of capital growth and solid returns from rental properties in Western Sydney. I recommend you engage an expert buyers’ agent to help you pinpoint the ideal properties in this region.

 

 

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The Propertybuyer
Podcast

 
Sun 23 Jun '24
with Rich Harvey
Why Tax Depreciation Matters
 
 
Fri 14 Jun '24
with Rich Harvey
Tax Effective Property Investment Strategies
 
 
Fri 24 May '24
with Rich Harvey
Granny Flats: Boost Your Yields & Faster Mortgage Repayments
 
 
Fri 3 May '24
with Rich Harvey
Unpacking the Northern Beaches with Incredible Agents
 
 
Fri 29 Mar '24
with Rich Harvey
How to build a $7 Million Property Portfolio from scratch
 
 
Sat 16 Mar '24
with Rich Harvey
Why Invest in Melbourne?
 

 

Listen to many more
podcasts on our
Podcasts page.