Former panel beater buys $450m shopping centre in Sydney’s leafy north shore
Capital Gain
Billionaire developer Sam Arnaout is making a big pivot into Sydney’s affluent shopping set, splashing a cool $450 million to buy the popular St Ives shopping centre which has not changed hands for 39 years.
Arnout, a property veteran who started his career as a panel beater, has built an empire of pubs, including the Hotel Steyne in Manly, hospitality businesses and mixed-use apartment sites in Newcastle and the Gold Coast.
The purchase of St Ives in the city’s leafy north shore comes with 12 adjoining properties.
The deal is being billed as the largest “neighbourhood” shopping centre sale in Australian history.
Arnaout’s Iris Capital bought the 17,475 sq m, triple-supermarket-anchored shopping centre from the private EK Nominees which has owned it for 39 years. The sizeable centre has a Woolworths, Coles and Harris Farm Markets and comes with an additional 105 specialty tenancies.
In Shopping Centre News’ annual ranking of Mini Gun Shopping Centres, it’s ranked first with moving annual turnover of $264 million a year.
Arnaout said the centre is well positioned to benefit from significant “tailwinds benefiting the retail sector, specifically the undersupply of retail floor space in the catchment, combined with critically needed future residential supply”.
The deal continues the current momentum of landmark Australian Retail deals including Westpoint Blacktown in NSW for $900 million; Macquarie Centre, also in NSW, for $830 million; the Perron/GPT retail partnership in Perth for $482 million; and Northland in Melbourne which transacted for $385 million.
Colliers’ Lachlan MacGillivray advised EK Nominees on the sale.
Crystal Palace
Another pub baron, Jon Feros, has snapped up the landmark Crystal Palace hotel in Haymarket from its owner Jimmy Galanakis who has held it for the past 45 years.
The popular pub is located opposite Central Station and was sold for about $35 million. It has a 3am licence, 21 hotel rooms, and 27 gaming machines.
The site is well situated to get development approvals because of its location in a metropolitan centre zone with a 50-metre height limit and a high-density floor ratios.
The deal will add to Feros’ JDA Hotels portfolio which has 13 hospitality venues across three states. JDA also owns and operates three other popular hotels in the Haymarket area – the Mountbatten Hotel, Charlie Chan’s Bar and Great Southern Hotel.
Feros said he will look at sprucing up the main and sports bars and over the longer term introduce boutique hotel accommodation in the guest quarters.
“We are very excited to add the Crystal Palace to our portfolio, and in particular so as to enjoy the synergies we believe will be able to create within a precinct we already know so well”, Feros said.
The deal was managed by HTL Property’s Dan Dragicevich and Andrew Jolliffe.
Co-living
The Sydney Potts Point Central Apartment Hotel has been bought for $31.5 million by global multi-manager BGO Strategic Capital Partners and the Sydney-based Hotel Capital Partners.
The deal at 15 Springfield Avenue, is said to be the country’s largest brokered strata amalgamation deal since the pandemic, comprising 73 individual lots.
Co-living is a relatively new concept where tenants rent a room and use communal facilities such as kitchen and laundries. It’s gaining traction as a new investment class for the commercial property sector.
The four-star hotel comprises 70 serviced apartments at an average of 23 sq m, a ground-floor food and beverage outlet and a rooftop with public amenities. The planned co-living facility will be managed by UKO, Australia’s largest co-living operator.
CBRE’s Tom Gibson and Angus Windred brokered the deal.
Randwick hotel
A prominent hotel development site in the heart of Randwick is set to hit the market with a development-approved project in one of Sydney’s most tightly held eastern suburbs pockets.
The 980 sq m parcel at 32-34 Blenheim Street has received development approval for a seven-storey project comprising 40 self-contained apartments, ground-floor retail and basement parking.
No price was disclosed, but similar properties have sold for about $28 million to $32 million.
It has a gross floor area of 2898 sq m and, with a flexible medium-density residential zoning, the site has potential for a variety of uses, including co-living, build-to-rent (BTR) or student accommodation.
Miron Solomons and Matt Pontey who recently joined Cushman & Wakefield from Colliers are managing the sale campaign on behalf of a private investor and expect interest from a wide range of buyers.
Contact carolynannecummins@gmail.com.
