Jonathan Chancellor | 19 October 2012

As residential reigns, AMP finalising East CIrcular Quay office block redevelopment

As residential reigns, AMP finalising East CIrcular Quay office block redevelopment

Just as one luxury Circular Quay residential development gets put on hold, another is in the early stages of its long-anticipated office block redevelopment of the golden strip.

It follows the NSW government giving its provisional go-ahead for the demolition of the former Coca-Cola headquarters, at 71-79 Macquarie Street in what will be the final phase of the East Circular Quay redevelopment. 

AMP Capital's Louise Mason has asked five of the country's leading architectural firms to take part in the design competition for the property at the eastern end of Circular Quay adjacent to the Cahill Expressway.

AMP Capital and Mirvac have been negotiating with the NSW Planning Department and the City of Sydney given the tenants Coca-Cola Amatil moving to North Sydney two years ago.

Under the scheme, the dated office block at 71-79 Macquarie Street will be demolished making way for a "world-class" residential tower along with serviced apartments.

The proposed 19-storey tower will adjoin the hotel that was recently rebranded the Pullman Quay Grand Sydney Harbour, having been initially known as the Quay Grand when developed by Mirvac. It was the former 1958 ICI House.

"This $300 million project will revitalise an important part of Circular Quay, significantly improving this landmark Sydney space for residents and visitors alike,” Mason says.

The development would "realise the original vision for the East Circular Quay precinct by completing the colonnade that extends along East Circular Quay from the Opera House”.

Ever since the early 1980s the then eight buildings along the East Circular Quay strip from 1 to 79 Macquarie were considered prime redevelopment space.

And by the late 1980s the bulk of East Circular Quay had been amalgamated by one of the long-term owners, the Melbourne-based life insurance office, Colonial Mutual Life.

It has cost the insurance company more than $250 million to buy three tired old buildings and two semi-dormant construction sites overlooking Circular Quay near the Opera House.

The grand scheme - which had been dreamed of for almost 20 years prior - was finalised when the Vaucluse property developer, Henry Roth, accepted an offer from CML's property investment manager, Fred Douglas.

Henry Roth had purchased the site in 1979 for a bargain $2.4 million and then had thwarted all attempts from developers to amalgamate the strip which runs from the Opera House forecourt to Moore Stairs, the sandstone steps that link the Botanic Gardens with the harbour.

The developer had once insisted he would sell only if the development included a penthouse for his use.

CML paid $86.8 million, a record $120,000 a square metre, for the nearby Unilever site which had been sold by the television newsreader-turned property developer David Brice who'd acquired the 1 Macquarie Street property site, in partnership with tourism supremo Adrian Zecha, from Peko Wallsend in 1988.

Among CML'S purchases was Hope House, which included the Sydney residence of the mining tycoon Lang Hancock.

The bulk of the amalgamated site became what's known as the Bennelong Apartments (aka The Toaster). 

Just along from East Circular Quay, last month the US private equity giant Blackstone shelved its prospective $1 billion luxury apartment project at Circular Quay.

The 1960s Goldfields House office block redevelopment has planning permission for the glitzy twin-tower development, 1 Alfred Street, which is set to expire in 2017. Last November Property Observer reported

pricey apartments in the development were being marketed off market to multimillionaire Sydney buyers in a by-invitation-only marketing campaign.

The coveted 25-storey Sydney property overlooking Circular Quay has some of the best views in town and has been mooted for a luxury residential redevelopment for the past few years.

It’s one of the oldest office blocks on Circular Quay with property agents suggesting the value of apartments in and around Circular Quay would be upwards of $34,000 per square metre.

Apartments overlooking the Opera House have sold for as much as $16 million.

Blackstone secured the “super prime guru” Robert Booth, who had marketed Dubai’s Burj Khalifa, to test the depth of international interest but shelved the project, triggering speculation by The Australian Financial Review that the firm intends to offload the property at some point over the next few years.

 

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