Adgemis Lot Final Piece in Rose Bay LMR Puzzle

As low and midrise proposals pile up in Sydney’s Eastern Suburbs and North Shore, the proponent behind a Rose Bay scheme says he has the secret sauce for bringing a project to fruition. The NSW government introduced its LMR reforms in 2025 with the intention of easing the pathway for densification projects. However, feasibility, land availability, council concerns and community opposition have put stumbling blocks in the path of LMR developers . Mathieson Property’s eight-storey, 70-apartment project at Rose Bay recently finished exhibition and has an estimated development cost of $86.9 million. Under that proposal, the nine-lot site at 2-6 Conway Avenue, 15-15A Fernleigh Avenue and 38-40 Carlisle Street would yield gross floor area of 8880sq m, at a floor space ratio of 2.86:1. Pending approval, marketing is expected to begin around the end of 2026 or early 2027, with a construction start on the MHNDU design in third-quarter 2027 and a handover in the third-quarter of 2029. It’s all about the site Mathieson founding director Alex Sicari told The Urban Developer that beginning with an appropriate site was crucial to unlocking the project. While much attention has been given to LMR “supersite” deals , acquisition can sometimes be piecemeal or grinding. “Mark Yeats [of Raine and Horne Double Bay] was involved in packaging up three of the houses which we acquired,” Sicari said. “And we were actually looking at doing just those three initially, with about 20 or 25-odd apartments. Then Fred Small [of Laing+Simmons Double Bay] packaged up two more.” Another three lots were acquired in direct, one-to-one negotiations with homeowners. All deals were done off-market except for the final lot, a repossessed Adgemis residential property. The Mathieson team was willing to work hard to pursue the site, given the rare suitability of the location for an LMR project. “It;s always difficult to acquire land well. That’s one of the most difficult bits of the development puzzle. But once you’ve got your foot on a really nice bit of dirt it gets really exciting,” Sicari said. “[The site is] unique in that it has got three street frontages. We only have one neighbour, who has just finished constructing a three-storey building under the old controls, and they’ve got three apartments in it. “We don’t have a direct neighbor, which means we’ve got a lot of buffer.” The site on the top of a ridgeline means unobstructed views of the harbour, which won’t be built out in the future, without obstructing neighbouring properties on the lee slopes. Unlike properties further downhill, flood risk is also very low for the site. LMR sweet spot hard to find According to Sicari, other LMR proposals have not been as propitious in the sites they’ve acquired, and the remaining opportunities are thin on the ground in prime LMR suburbs. “Even the ones that are secured, I’d hazard a guess that a lot of them will struggle with their DAs,” Sicari said, “because the sites are quite small, and people in general aren’t fully appreciative of the controls. “In particular the Apartment Design Guidelines setbacks. If you’re not at least 2000sq m or 2500sq m, getting the six storeys and 2.2:1 FSR to work is almost impossible, complying with the ADG setbacks. “So a lot of the DAs that are lodged in those smaller capacity sites, they are expecting some leniency around ADG, and I’m not sure whether they’re going to get it. “I don’t think there’s going to be as much supply as initial impressions might have given people.” ▲ A rendering of Mathieson Property’s eight-storey project at Rose Bay that has an estimated development cost of $86.9 million. While project feasibility (including penthouses priced in the tens of millions of dollars) have been a priority for developers, design and liveability are also crucial to making LMR stack up. “I think there are a lot of developers who aren’t, fundamentally, property guys. For them, it’s numbers on a page, feasibility stuff,” Sicari said. “But in reality, you need to sell the stock. And for us, it’s important that the product that we produce is as aspirational and as attractive to the market as possible. “So, we spend a lot of time understanding market trends; what the demographic of the area is expecting or requesting or acquiring.” Typology mix attracts finance The typology mix on the Mathieson project covers from entry-level affordable units up to penthouses. Household compositions from downsizers to young professionals, DINKs and families are catered for. In addition to the site characteristics, financiers were attracted to “the fact that we’ve got a real mix of housing types in this project to de-risk it,” Sicari said. “The attention to detail that’s gone into designing the units, together with delivery capacity and capability, it gives them more comfort. “I think it’s a sort of horses for courses type discussion, I think the good deals always get funding.”

Residential
Patrick Lau
Thu 26 Feb 26

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ResidentialPatrick LauThu 26 Feb 26

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