Developer chasing ‘air rights’ above Melbourne Club
Property giant Dexus has thrown down the gauntlet to rivals in the Victorian capital by lodging plans for a premium grade office tower on the Collins St site it assembled last year amid suggestions that it has opened talks with the venerable Melbourne Club about buying its air rights.
While neither party would confirm their discussions the blue-blood establishment venue owns valuable property adjacent to the Dexus site and accessing the air rights would allow the listed developer to augment its recently lodged scheme.
Dexus has lodged plans with the state’s Department of Environment, Land, Water and Planning and would spend about $550m on a 27,500sq m tower sporting the latest office technologies and ground-plane ambience to grace the “Paris end” of Collins Street.
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The listed property developer and investor last year outlaid about $160m for the Reserve Bank of Australia building at 60 Collins Street and about $70m for 52 Collins Street shortly afterwards to put together the site.
Advised by Ethos Urban, the group lodged plans encompassing the office blocks it owns at 52 and 60 Collins Street. They would see the partial demolition of No. 52, No. 60 completely demolished and a new tower built.
Dexus chief investment officer Ross Du Vernet would not be drawn on the group’s Melbourne plans, saying only “we continue to explore ways to enhance the scheme”.
It last year flagged it would transform the 2000sqm site into an office skyscraper worth at least $650 million.
Some players drew a comparison with Investa and Gwynvil’s successful 60 Martin Place, where the cantilevered northern face of the tower addresses St Stephen’s Church and allows each floor plate to extend above the church and its spire creating a prominent feature of Sydney’s skyline.
Mirvac has also worked with surrounding landlords to expand its 55 Pitt St site near Circular Quay, allowing for a bigger tower.
Dexus may contend with concerns about the winter sunshine into the club’s courtyard but any scheme would likely seek to ameliorate this issue.
The developer still faces a delicate task as club members will seek to maintain their privacy and are prepared to spend to ensure they hold sway over surrounding properties.
Earlier this year the club made efforts to buy another building next door, with club member Bill Shelton reported to have attended the auction to bid. But that site was secured by Aconex founder Rob Phillpot for $16.5 million.
Dexus already has a major presence at the “Paris end”, buying 80 Collins St from QIC Global Real Estate in May for a record $1.476 billion.
Alongside the potentially audacious move in Melbourne, deals in the Dexus pipeline include the Pitt and Bridge Street precinct in Sydney, the health and education precinct in St Leonards, and the waterfront precinct in Brisbane.
This article originally appeared on www.theaustralian.com.au/property.
