Top end of town investors look to city fringe
Top end of town investors are focusing on the city fringe areas where the properties offer development potential and can cater for the new flexible working practices with more people staying closer to home for shopping and nightlife.
Recent developments have included Public Hospitality headed by ex-KPMG executive Jon Adgemis and ex-Crown Hotels & Resorts Chairman Peter Crinis who transformed the Arts Hotel and 3 weeds into sleek designer hotel accommodation and pool bar emulating LA’s hipster hotel scene. The deal was valued at $36 million.
Another is by Central Element & Boston Global, backed by ex-Macquarie Bank executive Bill Moss, with the construction underway for Accor’s new $100 million 25Hours boutique hotel due for completion mid-2024.
Two new deals with a retail focus, are at 21 Elizabeth Bay Road, Elizabeth Bay and 245 Oxford Street, Darlinghurst through private investor and developer Greg Magree and Matt Hudson from Hudson Capital.
Hudson said the attraction is the working from home practices and the relocation from CBD to fringe and suburban locations, “which has further strengthened the trading performance of many hospitality operators picking up the few additional trading periods with mid-week lunches and aperitive dining”.
“We are confident in the strength of the investment market underpinned with strong covenants in key locations. Hospitality has been the most resilient sector through the last few years, and we expect this to continue,” Hudson said.
At 21 Elizabeth Bay Road, Magree and Hudson are selling the property in which Barry McDonald’s latest restaurant Bar Grazie in Elizabeth Bay has the lease for the next decade.
The property will be sold through agents Burgess Rawson’s Yosh Mendis and Drew Mitchell and CBRE’s Gemma Isgro, who said, “smart money is keen on the food and beverage sector after the continued strong performance compared with other retail categories trading out of the pandemic”.
The 245 Oxford Street property is currently leased to Kissuu, a multi-level hospitality venue and is nearby to the new hospitality precincts being developed by TFE, Ashemorgan’s Oxford and Foley and MA Financial’s Kinselas Hotel. There have been 15 new venues in Oxford Street in the last 6 months, according to Hudson.
The property will be sold through conjunctional agents Burgess Rawson’s Yosh Mendis & Drew Mitchell and Oxford Agency Daniel Marano.
“Over the last 24 months we have seen high net worth private investors and family offices competing for key positioning on the coveted street,” Marano said.
Mendis added that food investment assets have enjoyed continued strong demand from high-net investors nationally.
“Both Bar Grazie and Kissuu provide investors with Sydney eastern suburbs investment opportunities underpinned by some of Sydney’s most recognised names and operators” Mendis said.
Another recent deal was the Verona Cinema with the developers opting to retain the cinemas and include new office accommodation, a rooftop bar and retail shops. It was bought for about $35 million with around $13 million spent on upgrades.
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Source: Thanks smh.com