Billbergia is adding another 13 levels to its proposed North Sydney hotel and office skyscraper to reach nearly 50 storeys, thanks to North Sydney Council’s recent top-up of building heights in the CBD core.
The developer resubmitted plans in November for a taller tower on the 1076-square-metre amalgamated site at 86-88 Walker Street that would now reach 48 storeys, or 174 metres, instead of the previous 35 storeys, at 117 metres.
If approved, it would be taller than the commercial development to be above the future Victoria Cross metro station, which is proposed to be 42 storeys.
The budget allocated to the development, which will be Billbergia’s first commercial project, will also surge by $32 million to about $153 million, with the original plans in June costing $121 million.
As first revealed by Commercial Real Estate in June, the tower will cantilever above the heritage-listed Firehouse Hotel at 86 Walker Street, the air rights of which was acquired by Billbergia for an undisclosed sum from publican and owner Mark Barry.
“The provision of floor space above a heritage item captures what would otherwise be underutilised space in a key location of the North Sydney CBD,” planning documents wrote.
Mr Barry still owns the Firehouse Hotel, which he bought for $3.65 million in 2001, Domain Group records show. It will be retained as a pub alongside the development.
The other property at number 88 was acquired by Billbergia for $32.25 million in July 2018 from fund manager Marprop Real Estate Partners, which had purchased it for $21.2 million in March 2017 – representing a gain of $11 million in slightly more than a year.
Billbergia development manager Saul Moran told Commercial Real Estate that the company reapplied for a taller tower because of the new planning controls which were recently passed in North Sydney.
“When Billbergia purchased the land, we knew there was a LEP (local environment plan) in draft and was likely for endorsement, so (we) always anticipated the project being fully realised at 48 floors,” he said.
“We had prepared the new DA (development application) in anticipation, and as soon as the LEP was gazetted, we withdrew and lodged the new DA.”
North Sydney Council increased the maximum building heights for about 40 properties zoned B3 commercial core in the city centre in October. Two of these lots were 86-88 Walker Street, which were granted an extra 57 metres of building height.
The new tower will incorporate 252 hotel suites, starting from 18 square metres a room, across 16 levels.
Eight levels will be dedicated to facilities including ground-floor reception, restaurant, top-level bar, executive lounge, gym, end-of-trip amenities and back-of-house facilities, as well as another three levels for building plant and equipment.
The hotel, which has more than 10,000 square metres of gross floor area, will be leased or sold to a hotel operator.
Previous plans for the hotel had 224 suites across 14 levels.
Above the accommodation component, 21 levels of office space will be developed across more than 13,000 square metres.
There were only eight levels of commercial space in the previous application.
Mr Moran said the decision to nearly triple the amount of office space in the tower was made because the company saw strength in North Sydney’s office market.
“We are very confident with the outlook of the commercial market in North Sydney,” he said.
“Situated next to the new 100 Mount and 1 Denison office developments, we see this as forming a new commercial and entertainment heart within North Sydney.”
The North Sydney CBD is seeing an abundance of commercial development activity, with three towers being developed at the block between Denison and Walker streets.
These include Dexus’s 100 Mount Street, which is next door to Billbergia’s development, topping out at 38 storeys, or 149 metres, in late October.
And to the west of 88 Walker Street is the 37-storey 1 Denison development by Winten Group, which will reach 158 metres when completed in 2020.