Grocon trumps Lend Lease, Mirvac at Central Barangaroo

Central Barangaroo is considered the heart of the Barangaroo precinct.

A consortium consisting of Melbourne builder Grocon, shopping centre giant Scentre and Chinese-backed Aqualand looks certain to win the rights to develop Sydney’s most prestigious precinct, the $2 billion Central Barangaroo, in a major blow to underbidders Lend Lease and Mirvac.

The decision to appoint the trio to develop Barangaroo’s most important strip is before the NSW Premier’s Office and is likely to be highly controversial.

Lend Lease and Mirvac have spent millions of dollars and years working on bids for the precinct contending with a shifting planning framework.

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But the win is yet to be announced because Mirvac and Lend Lease are apparently lobbying the state government for a ­second tilt at the giant development site.

Executives associated with the process last night expressed frustration at the way the process had been handled, calling the decision to award the bid to Grocon one of the sector’s worst kept secrets.

The 5.2ha site is billed as the public heart of Barangaroo. Its ­development will combine residential, retail and commercial space, completing the sweep of buildings along the Sydney CBD western waterfront from Barangaroo Reserve in the north to the Lend Lease-developed hub at Barangaroo South, according to The Barangaroo Development Authority.

State planners and the BDA scrapped an original tender process following their decision to include a major Metro railway station within the precinct, which planners argued called for a rethink of planning requirements last year.

Central Barangaroo is considered the heart of the Barangaroo precinct.

Central Barangaroo is considered the heart of the Barangaroo precinct.

In late June, the NSW Planning Assessment Commission’s decision to approve a raft of proposed changes put forward by Crown Sydney and known as Modification 8 also shifted the goalposts by moving the position of the proposed Hickson Park further north, effectively decimating a parcel known as Site 5, where Lend Lease and Mirvac had planned a major portion of their developments, sources say.

It is understood the changes wrought by Modification 8 had less of an impact on the scheme put forward by Grocon and its partners.

Under the revised tender, developers are allowed a maximum above-ground floor space of 150,000sqm and an unlimited amount in an underground precinct linking a new Metro station with the broader space. Scentre is expected to develop a major shopping centre adjoining the station.

Lend Lease, which is developing Barangaroo South, was long viewed as the frontrunner to win Central Barangaroo. while Grocon was considered an outsider.

Central Barangaroo will also feature the Sydney Steps, linking Millers Point to the Harbour.

Frasers Property and Cbus were also interested in Central Barangaroo at one stage.

The BDA expects work on the site, involving 3ha of waterfront public lands and 2.2ha of development, to begin mid next year.

– with Samantha Hutchinson

This article originally appeared on www.theaustralian.com.au/property.