Mirvac forks out $249m for Nine Willoughby site

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AFTER months of speculation, Mirvac has confirmed it will buy the Nine Network’s headquarters in Willoughby for $249 million, and will take on the site’s approved concept plans for redevelopment with 460 apartments across ten buildings.

Nine has been broadcasting the 3.2 hectare site at 6-30 Artarmon Rd since 1956, and will vacate this year when it moves to Winten Property Group’s new 39-storey tower at 1 Denison Street in North Sydney.

Concept plans for Willoughby, by architects CHROFI and planner Ethos Urban, have the buildings ranging in height from four to nine storeys, as well as 6,000 sqm of publicly accessible open green space.

Initial plans for the site were scaled down from 495 apartments to 460, and were amended to include and more public space after 686 public submissions and 637 objections were received. The New South Wales Independent Planning Commission approved the current plans early last year.

LEPC9 acquired the site from Nine for $147.5 million in 2015, and put the site to the market with hopes of $200 million. Reports during last year had suggested bidding peaked at $171 million during the expressions of interest campaign, with interested parties including Harry Triguboff’s Meriton, Frasers Property Group, Chinese development giant Country Garden, Crown Group and Mirvac, and prompting the sales agents to affirm interest had reached beyond $220 million.

Colliers agents, Jon Chomley, Guillaume Volz and Eugene White sold the site on behalf of joint venture LEPC9, formed by local fund Lotus Group and Hong Kong-based fund manager Euro Properties.

Euro Properties chief executive, Neo Que Yau said the joint venture team’s goal was to create value through exceptional urban design and architecture to ensure the best outcome for the community.

“We believe we added the maximum amount of value to the site prior to the development phase and are very satisfied with the final outcome.”

Chomley said the landmark sale represents the first major transaction of a trophy residential site on Sydney’s prestige lower north shore for some time and is likely to be the only one of its size and calibre this year.

“Land prices have generally held well in strong areas such as Willoughby, however the downturn has largely impacted site availability and we believe that vendors will take confidence from the sale to bring new stock to the market,” Volz said.

Stuart Penklis, Mirvac’s head of residential, said the site represents a rare opportunity to acquire a large scale, masterplan-approved landholding in a highly sought-after location.

“This acquisition is consistent with our strategy and reinforces our ability to identify and secure opportunities on capital efficient terms, in the right location, delivering the right product at the right price.

“Extending our residential pipeline will enable us to service the growing demand for new homes, as the housing market continues to recover.”

The diversified developer has ridden the wave of the housing market rebound and posted an interim funds from operations increase of 37%, and revenue lifted 4% to $1.62 billion with an increase in residential settlements.

The full year target of more than 2,500 settlements remains on track, with 1,232 locked away, and defaults remained under 2%. Housing market sentiment is at a near six-year high, and price forecasts have been revised upwards as the turnaround in house prices continues, interest rates remain low and credit becomes more attainable.

However, its share price fell by 3.2% as some considered settlement numbers to be soft and the residential recovery may have started to ease.

Mirvac has also boosted its built to rent portfolio, taking its pipeline to almost 1,700 apartments following acquisitions in the northern Melbourne suburb of Brunswick, and the former Melbourne Convention Centre site, which it just bought for $200 million.

Mirvac will take on all aspects of the development process at Willoughby, including design and construction.

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