Private investor Marks Henderson has purchased a three-storey warehouse in inner Sydney’s Chippendale for about $30 million and intends to develop it into a workplace for the NSW capital’s growing technology hub.
The Melbourne-based company, which last month acquired a commercial building in The Rocks, has added to its portfolio of niche office properties with the purchase of the building currently owned by clothing importer Nick Mascitelli Imports.
The purchase of the 2500-square-metre 29-43 Balfour Street site, at a price understood to be about $12,000 per square metre, is higher than the $10,000 per square metre price paid for the nearby 3822-square-metre office building at 39-47 Regent Street last year and indicates prices in Chippendale are rising close to those of nearby Surry Hills.
It’s a bet by Marks Henderson that the gentrifying area of Chippendale will become part of the Gen Y-heavy tech hub clustered in the inner-city fringe dominated by University Technology Sydney and the Central Park urban regeneration site. The building is on the same street as Judith Neilson’s White Rabbit Gallery.
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The building is likely to be redeveloped to accommodate a tech industry employer. The nearby precinct, on the other side of Broadway, already accommodates employers including Apple, Telstra and Advance Open Technology and UTS and Charles Darwin University.
In Sydney’s tight office market, Chippendale, in the shadow of Central Station, is undergoing a transformation. The railway station itself is undergoing a $955 million transformation under a contract awarded last month to Laing O’Rourke as part of the NSW capital’s new $11.5 billion metro line.
Balfour Street itself was developed in the 1850s, when industry was growing in the area, and housed workers at the nearby Kent Brewery and butchers. The original brewery burnt down in 1853, but was rebuilt and the suburb deteriorated during the twentieth century, becoming a no-go area for many. The brewery closed in 2005.
The objective was to purchase buildings with special character in interesting locations in the city fringe to appeal to forward thinking tenants wanting a more distinctive and creative working environment.
Nick Mascitelli director Rocco Mascitelli said in an email to The Australian Financial Review that the property had not been sold.
Jonathan Vaughan and Hamish Henderson of Knight Frank, who brokered the deal, declined to comment.
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