Heavyweights vie for North Sydney office development
Major developers are jostling to build a new office tower in North Sydney that could be worth about $330 million with the contest for the site drawing interst from heavyweights including US group Hines and local player Primewest.
The contest, which has also drawn private players and offshore groups, comes amid a surge of interest in the area on the back of the new metro station and rising demand for space, with tenants including Nine and the NBN anchoring towers.
The companies are chasing a site in North Sydney brought to market by the private THIRDi Group, which had once been earmarked for a residential scheme, before the pre-sale market tanked.
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Mirvac had earlier been pitched as favourite for the site as it owns an adjoining property, but other developers are also lining up for the building, with John Holland at one stage seeking a North Sydney site before pulling back from the contest.
CBRE’s Scott Gray-Spencer and Ben Wicks and JLL’s Paul Noonan, Rob Sewell and Mitch Noonan are handling the process for the 2326sqm site, which has already drawn several offers of joint ventures or end take-out partners. The parties declined to comment.
The property comprises a consolidation of 40 residential apartments across five buildings at 2-4 Blue St and 1-5 William St, just a few hundred metres from North Sydney’s rail interchange.
THIRDi Group was able to consolidate the site into a premium mixed-use development site via PropertyFox’s Tim Fox and Michael Wydeman.
THIRDi has cited the property’s outstanding views of Sydney Harbour, the CBD and Barangaroo as drawcards. It is working with architectural firm Woods Bagot and will put in a development application shortly.
THIRDi may consider forming a joint venture to deliver the project or even a potential end sale of the proposed building.
North Sydney’s CBD has seen a wave of office projects including the Dexus-developed 100 Mount Street, which was near fully leased when it was completed, and 1 Denison Street, which has precommitments from Nine Entertainment and Microsoft, with Sony rumoured to be in the wings.
A new office building could be delivered by 2021 to coincide with a forecast spike in tenant demand.
JLL recorded 32,500sqm of positive net absorption in North Sydney during the first half 2019.
This article originally appeared on www.theaustralian.com.au/property.
