Impatient NSW govt miss out on 350% gain

A DEVELOPMENT site on Sydney’s CBD eastern fringe has changed hands for the third time in just four years, with the $70.5 million price tag the latest reflection of the city’s overheated development market.

It is the first time the vacant 9-25 Commonwealth Street site has traded with approved development plans, and the price tag is a massive 350% above the $20.1 million the NSW Government’s State Property Authority received for it in 2013 from private developer Coronation Property.

Coronation opted to sell it off only a year later with no approval progress. Even after a deal with Singaporean-listed Roxy Pacific Holdings broke down in due diligence, it still managed to realise $45 million for it – a value uplift of around 125% in just 12 months.

The Chinese investor who took on the site initially intended to convert the building in apartments, but managed to obtain Stage 2 development approval for a 32-level mixed-use tower comprising 52 apartments, 124 hotel rooms, 464 sqm of ground floor retail and basement parking for 45 cars, drawn up by FJMT Architects and the interior by Woods Bagot.

The irregularly-shaped 791 sqm site currently has a 3,165 sqm four-storey office building that has remained vacant since it was emptied by the AIDS Council of NSW. It features a triple street frontage and is positioned at the southern end of Hyde Park and close to Central Station.

Knight Frank’s John Bowie Wilson, Tim Holtsbaum and Dominic Ong negotiated the latest deal.

This is Knight Frank’s second major transaction this week after the agency handled the sale of a 135,961.6 sqm site at Little Bay to Harry Triguboff’s Meriton for $245 million.

The sale price is represents a $107 million premium to book value, according to the vendor Malaysia’s TA Global.

Australian Property Journal