Real estate

The report: Collier’s Luke Hayes on the outlook of the ultra-prime Sydney market and branded residences in 2025

Luke Hayes, director at Colliers, offers a perspective on Sydney’s ultra-prime property market in 2025. He explores current buyer behaviour, the rising appeal of branded residences—like the Crown Residences in One Barangaroo—and the unique challenges of meeting demand in a city defined by limited land and heritage constraints.

The ultra-prime Sydney market has been quite resilient of late, and we’re trading a lot of nice luxury apartments in and around the Eastern Suburbs, the Lower North Shore and the CBD. There hasn’t been any volatility in terms of what we’re seeing overseas—which I think is driven, locally, by the scarcity of that type of product. We are limited in the land offering, so when prime properties are created, they’re in reasonably high demand.

“While there is a lot more enquiry, we’re not yet seeing the transactions from offshore. Predominantly, most of the buyers to date have been local buyers purchasing in their home city.”

We are very much a safe haven here in Australia, and there has been a lot of enquiry coming from offshore. The dollar makes us look very attractive, and may counteract deferred taxes. But while enquiry is strong, we’re not yet seeing it translate into offshore transactions. Most buyers so far have been local, and One Barangaroo Crown Residences illustrates this clearly: of its 76 apartments, only four were sold to overseas buyers, with the vast majority purchased by Sydney residents.

Market outlook and key developments

New planning regulations in and around Sydney and especially the harbour will allow more and more products to come to market. So looking ahead, I think it will remain quite a strong market, probably increasing as our interest rates drop—as even though many ultra-prime buyers aren’t borrowing, the sentiment changes. We haven’t seen that translate into large increases in pricing, but the rate of sale is slowly increasing. So I think the time on market will decrease, and buyer sentiment is cautiously optimistic.

“New planning regulations in and around Sydney will allow more and more products to come to market. So looking ahead, I think it will remain quite a strong market…”

Sydney Harbour waterfront is always highly desirable. With a lot of it being heritage, especially on the North Shore, it makes it very hard to find those prime waterfront properties. So when they do pop up, they are unique—like the Waruda Kirribilli development of seven full-floor residences with postcard Opera House and Harbour Bridge views. The projects by Crown, and Lendlease—at One Sydney Harbour—really helped put the CBD back on the market, and we’ve had successful sale results in 111 Castlereagh above the David Jones building as well. It has put the CBD back on the market as a destination to live.

The rise of branded residences

Buying an apartment is definitely no longer a ‘second tier’ choice now. It’s the choice for that right-sizer seeking a different style of life. They may also have a home in Europe or Asia, and they’re looking for convenience. The big thing now is service—and that’s one thing that branded residence have only just touched on in Australia, that hadn’t been done before. There are a lot of beautiful apartments out there, but Crown was an example that every client I’ve sold to loves: the fact that they can call the concierge and say, ‘Can you please make sure the groceries are unpacked? And the place is clean, the flowers are fresh. Can you please make sure there’s a seat for me at the restaurant? And valet-park my car?’ They just get used to that.

“Buying an apartment is definitely no longer a ‘second tier’ choice now. It’s the choice for that right-sizer seeking a different style of life.”

Crown was the first project I was involved in that saw a true branded residence, and it was a huge success. The apartments were sold at a premium, and they’re continually sold and resold at a premium. And I think it is all down to the service that the branded residence offers. There are a couple of developers in the Gold Coast that are toying with the idea of a branded residence, where the homes are placed in the hotel’s rental program and leased out to guests when the owners aren’t using them, which is a very different model—and more of an investment play. For buyers at the ultra-prime level, these days, they want to be able to leave their clothes, their golf clubs, and their jewellery in that home—and to be able to have that service.

Navigating the challenges of the ultra-prime market

There are a lot of luxury apartments that I would say are not quite hitting the mark for these UHNW people. They’re beautiful apartments in a beautiful location, but they may be hindered by the car parking, or the view, or the service. I would say Sydney still has a higher level of demand for ultra-prime residences than we currently have in supply. So it’s about creating a product that ticks enough of the boxes. We’ve also seen many clients asking for amalgamations, because of relatively small unit sizes. Construction costs play a big part in the planning, so it’s about committing to that in the beginning, getting your buyer type right, so you’re not doing as many variations afterwards. We recently launched a new one in North Sydney, and several buyers have chosen to merge smaller units into larger apartments. But we’ve managed to sell 30 per cent of the project at an increased price in the first week, which is a really positive sign.

“At the luxury end of the market, it’s all about the relationships. It’s not traditional marketing… It’s working out what that buyer wants and then really sourcing them.”

With increased interest in new launches, we also see a need to guide the buyers through construction—working through with them to what it might look like in the end. A lot of people in that demographic like the touch and feel. But at the same time, the benefit of off-plan apartments is that you can customise it. At the luxury end of the market, it’s all about the relationships. It’s not traditional marketing; it’s not throwing it out there. It’s working out what that buyer wants and then really sourcing them, inviting them, and how you create that whole story. But the biggest challenge right now is probably finding the land.

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