Sydney restaurant surge spurs $96m harbourside splash

Sydney Skyline

The Sydney CBD top-end dining scene is recovering. Picture: Richard Dobson

The building spaces which house some of the top restaurants in the Barangaroo precinct beside Sydney Harbour are selling for about $96m in a sign of the resurgence of top-end hospitality trade.

The restaurants, which are set in the first two harbourside residential buildings, include some of the best known eateries in Sydney, with Asian-inspired restaurants including Lotus and Cirrus big drawcards.

They are being sold by developer Lendlease to Brisbane-based funds house Marquette as it adds to its collection of office buildings and retail holdings.

City restaurants are making a comeback in the wake of the coronavirus crisis with top end venues often booked out or pressed to accommodate returning diners.

The Barangaroo restaurants will be bolstered by the forthcoming opening of Crown Resorts’ casino operations, which will likely see more punters and tourists flock to the area.

Longer term, the completion of the adjacent Central Barangaroo precinct and more connections across the city will help ensure that the area remains a top dining destination, even as new restaurants spring up at Circular Quay and Justin Hemmes gets active in the heart of the city.

Some of the country’s best restaurants call the buildings home. These include Cirrus Dining, the waterfront seafood restaurant by the award-winning team behind Bentley Restaurant + Bar, Monopole and Yellow. They also house Chinese dumpling restaurant Lotus which is renowned for its strong seafood focused menu and extensive wine collection from around the globe.

Other outlets include Sydney institution, Bourke Street Bakery, which serves fresh-baked artisan made bread, rustic pies, and sweet and savoury pastries. Occupants include Sharetea, Batch Specialty Brewery, Shortstop Coffee & Donuts and modern Turkish restaurant and mezebar Anason. Thai street food venue Muum Maam is also in there as is seafood restaurant.

Other venues include neighbourhood-style Japanese restaurant Zushi, which has a long history in the city, and Ume Burger, under the eye of executive chef Kerby Craig, who was the creative force behind the former Ume Restaurant in Surry Hills.

Marquette will buy the leasehold of the retail stratum across both buildings at ground level, including two levels of basement below and the adjoining licenced areas. The properties comprises 20 tenancies including restaurants, cafes, and other retailers.

Marquette has formed a new unlisted fund, MQT Sydney Harbour Trust, to back the purchase of R8-9 Waterfront Dining & Retail, in Barangaroo Ave.

The properties will cost about $96.53m and St George is providing a debt of up to $45.1m with the manager to raise up to $51.43m from wealthy investors.

The parties declined to comment but Marquette told investors it would look to grow and stabilise income, improve the properties and improve the leases and covenants. Some new operators could come into the precinct.

Office deals are also still running in the city fringe of Sydney. LaSalle Investment Management has hooked a buyer for a three-level property known as Reservoir on Crown with a private group in the frame to buy the asset.

The Surry Hills mixed-use building is on one of the largest land holdings in the area and also has some hospitality exposure as the home of The Winery bar at 285a Crown Street. Real estate agencies Knight Frank and JLL are handling the deal which could show a price approaching about $115m but they declined to comment.