Waldorf Astoria Sydney to draw global crowd offering ultimate luxury at Circular Quay

The new Waldorf Astoria Sydney will overtake the Park Hyatt as Australia’s most expensive hotel with rates to challenge even the best global properties.

With a prestigious New York brand and unmatched views of the Harbour Bridge and Opera House, the Waldorf Astoria Sydney will overtake the Park Hyatt as Australia’s most expensive hotel with rates to challenge even the best global properties.

While it is hard to imagine the present construction site being transformed into an ultra-luxury 220-room hotel and apartment complex, investors are already knocking on developer Lendlease’s door trying to buy the project.

Advised by Michael Simpson of CBRE and Sam McVay of McVay Real Estate, the developer is fielding approaches from global real estate companies trying to secure a position on the project that will become the centrepiece of the redevelopment of Circular Quay.

The 28-level hotel – pitched by Waldorf Astoria owner Hilton as its crown jewel in the region – could hit the market later this year with an eye-popping price of more than $600m.

That is if it is not snared by its operator – or an associated party – for around this mark in a transaction that would equate to more than $2.5m a room before then.

A purchase would be a departure by Hilton as it switched to the asset-light business model that has long been common across the hospitality industry.

Big players like Marriott International and Hilton are essentially management companies after offloading the bulk of their property portfolios in the wake of the global financial crisis.

But some top management companies also pay up to secure top properties. A decade ago, in 2012, Hong Kong’s Shangri-La Asia group paid $352m for Sydney’s Shangri-La Hotel, guaranteeing it would remain in place and not lose the flag.

For Hilton and any other interested parties the Waldorf Astoria Sydney is even more strategic. The property is part of the super luxury One Circular Quay development which received a big kickstart last month when the project changed hands.

Lendlease seized control of the site in a deal worth up to $850m and is planning a $3bn development, ending years of delay and uncertainty over the site.

The Circular Quay site, which once housed Gold Fields House, had passed through the hands of several Chinese property developers who proposed grand schemes but ultimately failed to deliver.

Lendlease, with the backing of Japan’s Mitsubishi Estate, bought the property from Chinese-backed owner, AWH Investments.

An artist’s impression of Waldorf Astoria Sydney at One Circular Quay.

The property will be Australia’s first Waldorf Astoria in what will become a key flag for the brand globally. The distinctive hotel will be built beside the 61-level apartment building. It will sport two full-service restaurants, rooftop bar, day spa, swimming pool, ballroom and a boardroom, accompanied by ground floor retail.

Hilton expects the Waldorf Astoria Sydney will open by early 2025.

The deal-making to decide the hotel’s future is believed to have sparked the attention of some of the world’s largest investors.

Hilton has stated the property will become one of its global flagships, particularly in Australia where it already has a significant presence including the Sydney Hilton recently sold to Barings Asia Private Equity for about $530m.

While the Sydney Hilton has an established track record, the offer of Waldorf Astoria is expected to smash records when it opens as the country’s most sought-after property in what is becoming an already crowded niche.

Other new hotel openings will include Pontiac Land Group’s overhaul of the historic Department of Lands and Department of Education buildings in Bridge St, with the heritage-listed sandstone buildings to become five-star Capella hotels.

The long-delayed The Ribbon development in Darling Harbour is also getting back on track.

Chinese developer Greaton last month hired Multiplex to complete the project, which includes the 585-room luxury W Sydney hotel, after previously builders Probuild and Grocon hit the wall.

The Intercontinental Hotel is also being overhauled by Malaysian owners Mulpha.

But the future of one Circular Quay icon, the Sir Stamford at Circular Quay, is less certain with plans for apartments being considered.

Lendlease’s emergence as the site developer after years of unfulfilled schemes – going back to 2011 – has boosted confidence that a top project will be completed.