SYDNEY-based hotel developer Iris Group has secured a Newcastle site for $39 million, which offers mixed residential, retail and commercial potential.
GPT and NSW Government's transformation agency UrbanGrowth sold the 1.66-hectare property, with the majority bordered by Hunter, Newcomen, King and Perkins streets.
The Joint Regional Planning Panel (JRPP) recently approved the site for 47,800sqm of residential, 4900sqm of retail and 2700sqm of commercial space.
Savills director residential site sales Stuart Cox, who managed the marketing campaign with agents Neil Cooke and Ben Azar, says the sale represented one of the most significant property transactions in Newcastle in several years.
"Rarely is an opportunity of this magnitude offered to the market," Cox says.
"A master plan approved site with mixed use development potential in such an historic location and one with enormous forecast growth as Australia's pre-eminent regional city.
"It is without doubt one of the best opportunities to be offered to the market in New South Wales, and arguably Australia, this year."
He says the sale will deliver a vertical village unlike anything Newcastle has ever seen before.
The portfolio's existing improvements include a mix of 25 commercial and retail use buildings with a gross floor area of 23,500sqm.
It contains 81 tenancies, including 25 vacant, returning net annual income of $1.5 million.
Cooke says the expressions of interest campaign attracted strong interest from local, interstate and overseas buyers.
He says the majority of investors were searching for opportunities to deliver affordable housing to a rapidly growing market.
"There were a huge number of enquiries from some of Australia's best known developers and that was a reflection of both the property's location and its enormous potential," Cooke says.
"Newcastle has undergone an extraordinary economic turnaround recently including a significant rise in the construction of inner city apartment dwellings with little supply available for owner occupiers and investors."
He says demand was being driven by the increasingly unaffordable prices in Sydney forcing investors to head to regional centres.
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support