Infrastructure spending can have a significant impact on property prices. These price effects tend to happen in three stages: during the announcement of the upgrades, during the course of the upgrades, and finally, after the upgrades have been completed. If done successfully, these can have long-lasting impacts on the nature of an area altering the demographic profile over time.
Back in October 2022, the Andrews Labour Government announced they would deliver the biggest hospital project in Australia’s history. Following the announcement, a new Arden medical precinct will be built along with significant upgrades to the Royal Melbourne Hospital (RMH) and Royal Women’s Hospitals.
A part of the development is the new Arden medical precinct which will be located near the Arden train station in Melbourne’s inner North Melbourne. The site will include a hospital campus of both Royal Melbourne and Royal Women’s hospital.
The first stage is expected to create 7,500 construction jobs and around 12,500 more in the supply chain. The cost of stage one alone is anticipated to be between $2 billion to $2.5 billion, adding more than 400 beds in the process. The development is a part of a 12-year plan, costing between $5 to $6 billion. Construction is scheduled to start in 2025, with stage one projected to be completed by 2031 and stages two and three by 2034.
Through the course of the development, the existing hospital in nearby Parkville will be upgraded to focus on emergency and acute care. The Parkville and Arden medical precincts will be linked by the metro tunnel. As of 2025, both will have brand new train stations, making it a two-minute trip between the hospital campuses.
It is predicted that the project will result in 1,000 more patients receiving critical care on both campuses and 10,500 more elective surgery procedures at the Royal Melbourne Hospital Arden campus. The Royal Women’s Hospital will accommodate 2,500 more births after renovation.
Infrastructure is one of the four main macro factors we consider in the Blue Wealth Research Methodology. Infrastructure spending is essential because it drives economic growth by enabling trade and investment, creates jobs, and provides people with access to essential services, including transport. This development will create future demand for nearby suburbs if it hasn’t started already. The result will be to make the region more attractive to both prospective tenants and owner-occupiers, driving property prices and rents.