Timber’s share of the mid-rise market lifted for the second successive year in 2018-19. Although coming from a low base, timber’s share of the market in the 4 to 8 storey building space continues to grow, as this fourth annual mid-rise market share report demonstrates.
The chart here, repeated and explained in more detail later in this important update, shows the lift in market share from a low base.
Background to the mid-rise market development work
Prior to 2016 timber construction for buildings higher than 3 stories was permitted only after the designers could demonstrate compliance with the performance criteria specified in the Building Code of Australia (BCA). This was a lengthy and expensive process.
Therefore, to increase the appeal of timber products to architects and developers in this market the FWPA successfully sought to get the BCA amended to permit “fire protected” timber (light weight) and massive timber building systems in the mid-rise space (up to 25m – generally 8 stories).
In the project’s supporting documentation, a benefit/cost analysis modelled an uptake rate of 5% per annum over a 10-year period following the BCA amendment. To measure the impact of this change to the BCA and the overall effectiveness of the program, the FWPA has sought to measure the market share of timber products within the mid-rise space for class 2, 3 and class 5 buildings. For definition of these building classes, click here to go to the Wood Solutions’ website.
Market share assessment methodology
It is important to understand how FWPA has assessed the market shares.
1. Cordells Direct database was used as the source of information for the east coast market with the focus on the Sydney, Melbourne, Brisbane and Canberra markets.
2. The time period under consideration is the 2018-19 financial year and specific projects to be included were:
a. Commencement 1/7/18 to 30/6/19 (this eliminates problem about changing nature of project status at different points of time making a search on building approval potentially confusing as in time it will be replaced by commenced construction etc)
b. Building Type
i. Class 5 Commercial Premises
ii. Class 2 Residential (units, apartments, flats, townhouses, villas, student & group accommodation)
iii. Class 3 Aged Care, Hospitality, (Hotels, Motels, Backpacker)
c. Floors 4 and above (although it is important to note that the code change specifically impacts the 4-8 story market)
d. In previous tracking studies we have removed projects that did not involve a structural component as they were alterations and additions to an existing building. However, the project notes available for review did not provide sufficient detail to consistently identify such projects. Hence, any alterations and additions projects may remain in the data set.
e. Projects that were categorized as both Class 5 (Commercial) and Class 2 (Residential) were deemed Class 2 in order to avoid double counting.
3. Project analysis
a. 3 interpretations of market share were used
Marketshare 1 – number of Timber projects relative to the total number of projects (%)
Marketshare 2 – floor area of timber projects relative to the total floor area of all project (%)
Marketshare 3 – total number of units of timber projects relative total number of units (% – class 2 buildings only)
b. In the event the Cordell project data did not include relevant data such as the number of units or floor area of a project then the weighted average for buildings with the same number of floors was allocated to create a standardised data set.
4. Pool of Timber/CLT projects
a. Assistance was provided by the WoodSolutions Mid Rise advisory team to identify timber/CLT projects which commenced during the period. Information supplied indicated that some 19 projects needed to be considered. A comparison of these projects was then undertaken to see if any were contained in the Cordells project pool. This process resulted in 6 timber/CLT projects being matched.
Results speak for themselves
Using the above methodology, a total of 399 Projects were identified with four timber/CLT building in the 4-8 story category and two timber/CLT building in the 9+ category. The pool of projects is summarised as follows:
Class 5
|
4-20 Storey projects commenced |
98 |
|
Less: duplicates with Class 2&3 projects |
66 |
|
Net Class 5 Pool |
32 projects |
Class 2&3
|
4-20 Storey projects commenced |
367 projects |
4+ Storey timber buildings that commenced construction during 2018/19 Financial year
|
Cordell Project ID |
Project Title |
Address |
Suburb |
State |
Building Class |
Floors |
Floor area (m2) |
|
2127524 |
ROBERTS STREET APARTMENT BUILDING |
110 Roberts St |
FOOTSCRAY WEST |
VIC |
2 |
4 |
1,382 |
|
397859 |
BALLARAT GOVHUB |
45-61 Waterloo Rd |
BALLARAT |
VIC |
5 |
5 |
16,552 |
|
7171207 |
OLEA MASON |
54 Oleander Dr |
MILL PARK |
VIC |
2 |
5 |
3,541 |
|
7335026 |
LA TROBE UNI BUNDOORA STUDENT ACCOM |
362 (Lot 2) Newbridge Rd |
BUNDOORA |
VIC |
2 |
7 |
3,455 |
|
7174627 |
MONTEREY APARTMENTS |
9 & 9A Lambert St |
KANGAROO POINT |
QLD |
2 |
10 |
3,781 |
|
6933506 |
NORTHUMBERLAND COMMERCIAL DEVELOPMENT |
2-14 Northumberland St |
COLLINGWOOD |
VIC |
5 |
13 |
15,000 |
Source: Anecdotal industry data compiled by Wood Solutions Mid Rise Advisory Team
Total Data Series 4 – 8 storey – Mid-Rise BCA deemed to comply (Total projects)
*note pool of class 5 projects are only Commercial and exclude any mixed residential projects which to avoid double counting have been included as class 2 & 3 buildings
Total Data Series 4 – 8 storey (%) Market Share
|
Class 2, 3 &5 |
Timber |
Concrete and/or Steel |
Total |
|
Projects |
1.3% |
98.7% |
100% |
|
Apartments Class 2 &3 |
2.9% |
97.1% |
100% |
|
Floor Area |
2.0% |
98.0% |
100% |
Total Data Series 4 – 20 storey (Total projects)
|
|
|
Timber |
Concrete and/or Steel |
Total |
|
Class 2&3 |
Projects |
4 |
363 |
367 |
|
Floor Area (m2) |
12,159 |
1,852,920 |
1,865,079 |
|
|
Apartments |
466 |
25,588 |
26,053 |
|
|
Class 5 |
Projects |
2 |
30 |
32 |
|
Floor Area (m2) |
31,552 |
508,540 |
540,092 |
|
|
Total |
Projects |
6 |
393 |
399 |
|
Floor area (m2) |
43,711 |
2,361,460 |
2,405,171 |
Total Data Series 4 – 20 story (%)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
1.5% |
98.5% |
100% |
|
Apartments Class 2 &3 |
1.8% |
98.2% |
100% |
|
Floor Area |
1.8% |
98.2% |
100% |
Cumulative performance shows solid improvements
This is the fourth tracking study undertaken since 2015-16 which means we can start to compare progress against previous years.
|
Market Share |
2015-16 |
2016-17 |
2017-18 |
2018-19 |
|
4-20 Storey projects |
412 |
756 |
669 |
399 |
|
Projects |
0.97% |
0.40% |
0.60% |
1.50% |
|
Floor Area |
0.65% |
0.87% |
0.57% |
1.80% |
|
Apartments Class 2 &3 |
0.60% |
na |
na |
1.80% |
|
4-8 Storey projects |
317 |
568 |
505 |
313 |
|
Projects |
1.26% |
0.18% |
0.59% |
1.30% |
|
Floor Area |
1.73% |
0.38% |
1.59% |
2.00% |
|
Apartments Class 2 &3 |
1.66% |
0.20% |
1.41% |
2.90% |
Conclusion
When considered against the earlier studies we are seeing an upward trajectory from a low base. It was also interesting to note that the pool of anecdotal timber projects, of 19 which was substantial, only matched with 6 projects in the Cordell data base. It is unclear why all 19 of these projects were not covered in the Cordell database and further thought will be given to how to identify those projects in subsequent studies.
Jim Houghton
Statistics & Economics Manager, FWPA
Detailed Data – Analysis of all projects by building class
Class 2&3 Buildings
Total Market Opportunity Class 2&3 Buildings 4 -20 Storey (# of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
4 |
363 |
367 |
|
Floor Area |
12,159 |
1,852,920 |
1,865,079 |
|
Apartments |
466 |
25,588 |
26,053 |
Total Market Opportunity Class 2&3 Building 4 -20 Storey Market Share (% of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
1.1% |
98.9% |
100% |
|
Floor Area |
0.7% |
99.3% |
100% |
|
Apartments |
1.8% |
98.2% |
100% |
Total Class 2&3 Building 4 – 8 storey – Mid-Rise BCA deemed to comply (# of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
3 |
287 |
290 |
|
Floor Area (m2) |
8,378 |
1,011,327 |
1,019,705 |
|
Apartments |
428 |
14,209 |
14,638 |
Total Class 2&3 Building 4 – 8 storey – Mid-Rise BCA deemed to comply (% of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
1.0% |
99.0% |
100% |
|
Floor Area |
0.8% |
99.2% |
100% |
|
Apartments |
2.9% |
97.1% |
100% |
Class 5 Buildings
Total Market Opportunity Class 5 Buildings 4 -20 Storey (# of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
2 |
30 |
32 |
|
Floor Area |
31,552 |
508,540 |
540,092 |
Total Market Opportunity Class 5 Building 4 -20 Storey Market Share (% of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
6.3% |
93.7% |
100% |
|
Floor Area |
5.8% |
94.2% |
100% |
Total Class 5 Building 4 – 8 storey – Mid-Rise BCA deemed to comply (# of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
1 |
22 |
23 |
|
Floor Area (m2) |
16,552 |
199,220 |
215,772 |
Total Class 5 Building 4 – 8 storey – Mid-Rise BCA deemed to comply (% of projects)
|
|
Timber |
Concrete and/or Steel |
Total |
|
Projects |
4.3% |
95.7% |
100% |
|
Floor Area |
7.7% |
92.3% |
100% |
