Scentre Group and Cbus Property have purchased the David Jones Market Street building in Sydney’s CBD for $360 million, which they plan to develop into a luxury retail space and luxury residential tower.
Scentre’s share of the purchase price is $182.5 million with Cbus Property paying the balance of $177.5 million, the Scentre Group stated.
David Jones will continue to occupy the site until late-2019 under a lease agreement providing a 4.5 per cent per annum rental return on the acquisition price. During this period, co-owners Scentre and Cbus will obtain the necessary approvals to redevelop the site when David Jones vacates the building.
Upon completion, the redeveloped 77 Market Street site will comprise approximately 10,000sqm of luxury retail space integrated with Westfield Sydney, and Cbus Property will convert the balance of the existing building to provide quality office space and develop a luxury residential tower above, overlooking Hyde Park.
Scentre Group will own, develop, design and build the retail elements of the site.
“This transaction is a rare opportunity to significantly expand our flagship Westfield Sydney centre,” said Peter Allen, Scentre Group CEO.
“The 77 Market Street site will provide the opportunity for further luxury retail and high-quality food, which combined with our existing Westfield Sydney and David Jones’ planned $200 million investment into the adjacent Elizabeth Street store, will reinforce the precinct as Sydney’s pre-eminent luxury retail destination,” Allen said.
Adrian Pozzo, Cbus Property CEO, said the property would provide another “excellent opportunity for Cbus Property to demonstrate its core capabilities in residential and commercial development in what will be a vibrant mixed use building in an exciting location with unrivalled amenity.”
Pozzo added this mixed use project will complement their soon to commence $1.25 billion development at 447 Collins Street, Melbourne.
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