High-Stakes Bid to Shape Adelaide’s Next Urban Precinct

One of the Adelaide CBD’s largest urban renewal projects in a generation is offering developers something rare: flexibility. Backed by the state, the scheme offers latitude to shape the $900-million precinct plus access to a $500-million guaranteed fund that removes the need for presales. South Australia’s government has launched a national search for developers capable of delivering the city-shaping East End project. The $900-million City East masterplan covers nearly 8500sq m including laneway connections and new public realm between Pirie and Flinders streets in Adelaide’s eastern precinct. Alinea Group managing director Ben Koop tells The Urban Developer the expression-of-interest process, now under way through Alinea Group and Colliers, will close in mid-February and development partners are expected to be selected by mid 2026. Koop says the successful developers will need to demonstrate they can extract maximum value from the site while leveraging the opportunity to deliver 200 affordable apartments as a pre-agreed take-out—a genuine precinct-shaping project that will separate serious contenders from opportunists. “Given the scale of the project and that it’s the highest priority mixed-use affordable housing project in the city, there is a real focus on certainty of delivery,” Koop says. “We’re seeking groups that have a strong track record of delivering comparable, larger-scale, high-density, mixed-use projects and precincts.” ▲ The City East masterplan includes a 1400sq m village green surrounded by street-level retail and dining. The project is a partnership between the state, the City of Adelaide and community housing providers Junction and Unity Housing. The masterplan comprises four towers rising to 39 storeys of more than 700 apartments—including 200 affordable homes—alongside a 200-room hotel, commercial office space and activated street-level retail centred around a 1400sq m village green. Koop says value maximisation is a critical component of the outcomes to be unlocked by the preferred development partner “to contribute to funding the affordable housing tower, which will be retained by the two largest community housing providers in SA”. Junction and Unity Housing will lead a Housing Australia Future Fund round three funding application for the affordable tower, supported by the State government. “The key to this is a value sharing approach, with the opportunity for development partners to leverage a delayed payment structure to maximise benefits for all parties,” Koop says. “It’s intended to be a landmark product for SA in terms of mixed-use precinct curation. “The balance of the development is really there for the private sector development partner, or partners if it was two, to really optimise that land use mix.” Developers can propose purpose-built student accommodation, build-to-rent, conventional market housing or hotel uses across the remaining towers. Interest has emerged across all typologies, with build-to-rent generating particularly keen attention from local and interstate groups. “We’ve had very strong interest from the right types of groups, locally and interstate, and across all key land uses,” Koop says. “Even build-to-rent, which is very encouraging because Adelaide has yet to see a build-to-rent scheme delivered in the CBD, and this would be potentially the first if it was taken up.” ▲ The $900-million precinct would become one of Adelaide CBD’s largest mixed-use developments with towers rising to 39 storeys. While the landowner group is targeting a single master developer to deliver the entire project, it will consider multiple development partners. Either way, they would be expected to deliver the private towers while co-ordinating delivery of the retained affordable housing tower. “If we get a particular group that said, we want to take out a single tower such as a purpose-built student accommodation tower, and we can partner them up with a master developer, then we can certainly head down that pathway,” Koop says. “We’re preserving flexibility.” Masterplan architect Bates Smart has developed the framework with multiple tower configurations tested to allow incoming developers to refine the scheme. Bates Smart director Matt Davis says the masterplan establishes clear vision while enabling development partner input. “The City East Masterplan presents a clear and compelling vision for bringing more residents into the City of Adelaide,” Davis tells The Urban Developer . “Exceptional public spaces, new connections and a rich mix of uses will create an active and engaging neighbourhood of around 700 apartments, including 200 affordable homes.” Davis says the partnership between government, council and housing providers “reflects the kind of collaboration and ambition needed to shape our cities today”. Koop says the approach differs from typical state-led schemes in its flexibility. “The fundamentals of how the precinct itself could be set up in terms of basement design and podium and land use mix are there,” he says. “But we’ve tested optionality on multiple tower configurations. We’re making all that available to development groups, so they can effectively put their stamp on it and refine it.” ▲ Bates Smart director Matt Davis and Alinea Group managing director Ben Koop. The scheme has been tested for viability, with developers retaining control over the final design. The site includes provision for a dining and entertainment hub anchored around a new civic plaza, a mid-size gourmet supermarket, and leveraging close connections to the East End and Hutt Street dining and entertainment precincts. A unique aspect of the project sees all land parcels merged into one landowner entity with efficient governance, removing typical bureaucratic hurdles. “The development partner will be contracting with the equivalent of a private delivery entity, controlling the consolidated landholding, with a skills-based board,” Koop says. “It’s going to make for a very fast and efficient decision-making and project delivery process, which is quite different for a typical state-led urban renewal project.” The state government’s $500-million CBD apartment tower underwrite fund, announced as a pre-election commitment, provides additional incentive for development groups. The fund would remove sales risk from high-density tower delivery, with the scheme becoming live if the Malinauskas government secures a second term in March 2026. “That’s effectively taking presales risk out of delivery of high-density towers,” Koop says. “It’s a massive potential boost for groups to leverage to get the whole scheme out of the ground quickly, potentially in one single stage.” Planning approval will follow a Crown-sponsored pathway with the Minister for Housing and Urban Development serving as approval authority. This will expedite the planning process, Koop says. Development approval applications are expected to be lodged through 2026, with planning consent expected in early 2027 and construction commencement in the first or second quarter of 2027. ▲ The precinct includes provision for a mid-size gourmet supermarket anchoring dining and entertainment offerings. South Australia’s broader development pipeline is attracting interstate attention, with a strong market and government support creating favourable conditions for developers looking to jump borders. “The SA market’s performing very well, supported by solid fundamentals and a strong government, which has certainly caught the attention of the eastern seaboard,” Koop says. More than 30 major projects worth over $10 billion are either planned, approved or under construction across Adelaide. Market Square, a $400-million development at Adelaide Central Market , achieved over 90 per cent residential sales within weeks of launch. The 39-storey project incorporates commercial office space, a 248-room Treehouse Hotel and activated public spaces. Festival Tower Two, a 38-storey commercial tower valued at $1.3 billion , is progressing, while the $400-million Keystone Tower on North Terrace would become Adelaide’s tallest building at 183m across 37 storeys, incorporating a 240-room Westin Hotel, student accommodation and observation deck. Planning minister Nick Champion says the City East project would transform Adelaide’s eastern precinct. “At the core of the housing offering is fairness, affordability and an opportunity in our housing market for those who want to enjoy the benefits of city living,” Champion says. Koop says, when it comes down to it, selection criteria will prioritise developers who understand precinct value creation beyond individual towers. “We’re really seeking groups who understand how to unlock value from larger mixed-use precincts and can raise the standard of new generation product coming into the city,” he says. “It’s more than just a collection of individual towers. It’s a new destination and a new city precinct that’s going to help unlock the best value and the long-term legacy outcomes of an amazing place to visit, stay, or live.”

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