Gurner goes back to his roots with plans for $800m residential tower on St Kilda Road

Gurner goes back to his roots with plans for $800m residential tower on St Kilda Road

Tim Gurner’s appetite for growth continues unabated with the developer, backed by Singapore’s sovereign wealth fund GIC, announcing plans to transform a prime Melbourne commercial site on St Kilda Road into an $800 million residential development.

The site, reported to have been acquired for $80 million, has been in Gurner’s sights for the past decade and it will be the second that Gurner Group has announced for the company’s GIC-backed build-to-sell fund following the July purchase of 189 Kent Street in Sydney for more than $200 million.

The Melbourne property, located at 424-6 St Kilda Road, comprises a site area of 4,651sqm and is currently occupied by two six-storey office buildings joined by a five-level atrium.

The prime corner site, which is bounded by St Kilda Road, Toorak Road and Queens Lane, is across the road from St Moritz, one of Gurner’s earlier joint venture projects with veteran Melbourne developer Morry Schawartz. The development was among Gurner’s first before striking out on his own with Gurner Group in 2013.

“I have had my eye on this particular site for over a decade, having cut my teeth with Morry Schwartz on 401 St Kilda Road in 2008 across the road so it’s humbling to be able to come full circle with another site now directly across the road some 15 years later, still with the same aspirations to create a new benchmark for residential design just as 401 did at the time,” Gurner says.

“Saint Moritz showed us the depth of this end of the market and we are excited to evolve and elevate this concept and take it even further with this project.

“With its prime iconic corner location it will become an iconic landmark for Melbourne so we cannot wait to do this site justice.

“As with all our projects we will be delivering iconic architecture, curated residences and six-star amenity, all with a world-class wellness and retail offering that will allow residents to live their best life.”

Gurner secured the redevelopment site via an off-market deal after the property was taken to market by JLL and CBRE late last year.

The site provides views over the Royal Botanic Gardens and Domain precinct, the city skyline and Albert Park Lake, as well as proximity to South Yarra’s retail and dining precinct.

Gurner plans to deliver apartments targeting ‘downsizers and lifestyle upsizers’ with a focus on wellness and lifestyle, with plans for on-site retail.

The site previously had permit approval for an 18-storey building with 51,000sqm of gross floor area, 339 apartments and 292 car spaces. However, that approval has lapsed and Gurner plans to submit a new planning scheme comprising 160 to 180 luxury apartments.

The company plans to let existing leases on the property run out before moving to demolition and development.

“This is a longer-term play for us as the buildings currently house some long-term tenants, so we’ll see out those leases before launching when the time is right,” Gurner says.

“We are fortunate to be in an incredibly strong position with a large amount of capital ready to deploy in a market that is deeply dislocated so we are taking a counter-cyclical approach to deals that make sense for our business.”

Gurner Group’s chief development officer Robert Clarke says the group is actively seeking more opportunities in Melbourne and Sydney, with the company expecting to announce further acquisitions soon.

“It’s a tough environment for developers and commercial asset owners currently, and the effects of interest rate hikes are still yet to really play out across valuations and interest covenants, so we do expect to see a continuing trend of office assets being put on the market at discounted 2022 prices,” Clarke says.

Gurner Group is working in both the build-to-sell and build-to-rent space with the latest acquisition backed by a $400 million investment late last year by Singapore’s GIC to drive the company’s expansion of build-to-sell projects in Australia.

Gurner separately operates a build-to-rent management platform in partnership with alternative asset manager Qualitas (ASX: QAL) which has a pipeline of 3,650-plus apartments on its books.

Enjoyed this article?

Don't miss out on the knowledge and insights to be gained from our daily news and features.

Subscribe today to unlock unlimited access to in-depth business coverage, expert analysis, and exclusive content across all devices.

Support independent journalism and stay informed with stories that matter to you.

Subscribe now and get 50% off your first year!

AI-driven Evitat platform creates pathway to a more sustainable building and renovation industry
Partner Content
Evitat, an AI-driven data platform, is empowering design and build professionals in the...
Evitat
Advertisement

Related Stories

"End of an era": me&u founder Stevan Premutico steps down from board

"End of an era": me&u founder Stevan Premutico steps down from board

Stevan Premutico, a pioneer in QR code restaurant ordering and digi...

ASX biotech minnow Hexima raising $4m to buy and become autonomous intelligence company RealThing

ASX biotech minnow Hexima raising $4m to buy and become autonomous intelligence company RealThing

More than two years after losing 87 per cent of its value in a sing...

South Australian expansion lifts revenue for distracted driver detection tech scale-up Acusensus

South Australian expansion lifts revenue for distracted driver detection tech scale-up Acusensus

Distracted driver detection technology company Acusensus (ASX: ACE)...

Would you pay to quit TikTok and Instagram? You’d be surprised how many would

Would you pay to quit TikTok and Instagram? You’d be surprised how many would

Social media is a problem for economists. They don’t know how...