An Oxford Street landmark in Sydney’s east, the former Palace Verona art house cinema, is set to be transformed into a $100 million upmarket office complex with retail and rooftop dining. Having been officially opened in a star-spangled event by Nicole Kidman and her then husband Tom Cruise on Valentine’s Day 1996, the site was closed down last December for redevelopment, with the Palace chain planning to reopen the cinema at the Entertainment Quarter.

It will now re-emerge at its 17 Oxford Street address as an eight-level, 3500 square metre, state-of-the-art site that will be the first large-scale commercial office offering along the popular eastern suburbs strip.

The site was bought by private development companies WT Malouf February in 2021 from previous owner Robert Bleakley, founder of Sotheby’s Australia Fine Art, for $30.8 million.

It was built in 1946, starting its life as an industrial facility before eventually becoming the iconic cinema. The historic former industrial brick facade will be retained.

Named Verona in a nod to the building’s cinematic heritage, the project will be aligned with City of Sydney council’s vision to “revitalise the creative and cultural precinct” and be underpinned by commercial property.

Designed by architecture practice Scott Carver, Verona will feature two levels of sub-terranean cinema spaces and cultural retail on the ground floor. Four levels of commercial office space will sit below a 620 square metre rooftop which earmarked as a destination restaurant and bar. “This project is an amazing opportunity to reinvent and redefine the next generation of cultural experiences on Oxford Street,” Doug Southwell, project architect and co-managing director of Scott Carver, said. “It anchors the eastern end of the City of Sydney’s Oxford Street renewal and will help people rediscover one of Sydney’s most creative and culturally significant areas.”

The new mid-rise tower sits adjacent to the 25 Hours Hotel with 109 rooms, being developed by Central Element and Boston Global, which is set to open in December. Oxford House is also nearby at 21 Oxford Street and features a 56-room hotel with a courtyard pool, poolside bar and all-day diner.

The council and developers are focused on offering office space in prime suburban precinct as more people opt to work closer to home.

Leasing agents for the new Verona, Mercer Property and Knight Frank, said early enquiry has been received from tenants across a broad range of industries given the development’s proximity to Allianz Stadium, Fox Studios and St Vincent’s Hospital in Darlinghurst. “It’s a compelling opportunity, there’s simply no office space of this scale available in Paddington,” Mercer Property founding director Tom Speakman said. “It’s bringing city-style space to Paddington and the market is ready for it. The tech sector is another with other fringe locations like Surry Hills and Darlinghurst at capacity.” He said there is demand from eastern suburbs-based workers who are drawn to Verona’s proximity to home, that will reduce the commute into the city.

Data from Knight Frank reveals the surge in demand for commercial space in CBD fringe locations in response to persistent hybrid working styles post-COVID, with net face rents experiencing an average growth rate of 6 per cent over the last 18 months. The director and head of office leasing at Knight Frank, Nick Lau, said vacancy rates within the city fringe are among the lowest in the Greater Sydney area, “with an undersupply of prime stock evidenced by sub 2 per cent vacancy in Surry Hills, Darlinghurst and Eveleigh”.

Plans are already underway to convert a landmark Art Deco property in Woolloomooloo into a whole building office space for lease. The strategic move has been made to meet a growing demand from Sydney businesses seeking unique independent premises.

Currently the home of popular Japanese restaurant Riley Street Garage, and prior to that Lessey’s Drive Yourself car hire business, 55 Riley Street has lived several lives since it was built in the 1930s. Now the address will be reborn as a sophisticated two-level office building.

Parlour Group, owners of the period property, have decided to steer away from hospitality and create a designer office befitting its vibrant city fringe location between the CBD and Darlinghurst.

Mercer Property co-founder Tom Speakman said the move is a response to an overwhelming demand from boutique businesses seeking an alternative to uninspiring office blocks.

“What modern business owners want from an office has changed dramatically in recent years. Today, many companies are stepping away from traditional corporate set ups where they might previously have been sharing multilevel premises, amenities and elevators,” he said.

“Instead, they’re looking for contemporary multipurpose workplaces they can position as a destination for staff and clients. As a result, there has been an uptick in the demand for unique fully equipped spaces in convenient locations – and 55 Riley St will be just that.”

The versatile building will soon be repurposed to suit a variety of tenants from creative outfits to dynamic corporate enterprises. Concept plans by renowned local design studio, The World is Round, are already in the pipeline with CGIs available to view.

“Tenants who come on board now and are ready to commit to a lease in the early stages will have the opportunity to liaise with the owner on some design elements, putting them in the fortunate position of creating a tailor-made office for their team,” Mr Davoren added.

The owner’s vision is to highlight existing heritage features of the landmark building’s exterior and interiors while simultaneously creating an adaptable workspace over two levels. The already 422sq m footprint of the site will be expanded out to approximately 800sq m of internal floor area.

An immaculately preserved pre-war building, the Woolloomooloo property features a striking brick façade, exposed internal brickwork, a pitched 6m ceiling with original steel beams, grand steel-framed windows and timber floorboards.

When completed by the second quarter of 2023 (subject to planning approval), the new look building will be offered with a turnkey fit-out featuring two reception desks, two meeting rooms, 80 work stations, an executive boardroom with space for 14 and multiple staff break-out areas. There will also be a separate communications room, large kitchen, male/female, plus unisex bathrooms and bike racks.

Ideally located for staff commuting via public transport, car, bike, or by foot, the office’s CBD fringe location has several must-have amenities nearby. In addition to public parking at the Domain where reasonable commuter day rates are on offer, the property is within a 15-minute walk from Town Hall, Kings Cross, Museum and St James train stations.

For work lunches, drinks or visitor stays the position is also perfectly placed close to an array of eateries, hotels and venues as well as being surrounded by pedestrian and bike safe routes. Staff can also make the most of Cook + Phillip Park aquatic centre, plus Hyde Park and Domain green spaces for lunchtime breaks or after hours exercise.

With three street frontages and dual access through the front of the building (DDA access), and via Busby Lane to the rear, the freestanding building stands unparalleled in its sought-after neighbourhood.

For more information about 55 Riley Street and the upcoming leasing conditions, or to arrange a private viewing, contact the Mercer Property team.

A slice of Sydney history is on offer with the Darlinghurst home of Bill & Toni’s Cafe and Restaurant coming on to the market.

The much-loved eatery has operated from the same spot for half a century and now the building is expected to sell for in excess of $4m.

Bill & Toni’s Cafe and Restaurant will continue to operate.

Marketed through Mercer Property co-founders Tom Speakman and Matt Davoren through an expressions of interest campaign closing on August 25, the iconic eatery at 72-74 Stanley St is two years into a seven-year lease with an option to extend.

An integral part of Sydney’s original “Little Italy”, the seed for today’s Bill & Toni’s was planted in 1965 when Guglielmo (Bill) Chiappini opened the San Siro coffee lounge at the site.

By the early 1970s, Sydney had fallen in love with Italian food so Bill added a restaurant above San Siro where Toni de Santis and Adolfo Fasciani cooked up authentic fare and a culinary star was born.

Since then, everyone from celebrities to everyday lovers of traditional Italian cuisine have dined out at the landmark bistro.

Everyone from celebrities to everyday lovers of traditional Italian cuisine has dined out at the landmark bistro.

“I think any investor who knows and understands the food business, or frequents the restaurant or cafe, would have some sentimental attachment to this property,” Mr Speakman said.

He added that while the hospitality industry has experienced challenges in 2020 and 2021, the popular establishment clearly had the recipe for success.

“These guys survived all of that and are still kicking goals. So I think it’s a testament to the business, and a testament to how loved they are in the local community.”

The prime city-fringe property sits on 278sq m and features two levels of cafe and restaurant space including two commercial kitchens, dual street access and rear parking for two to three cars.

In addition to the five years remaining on the current lease, there is an option to extend to 2032.

There is an option to extend the current lease.

The property earns a gross income of about $228,000 plus GST and there has been previous approval to build a rear outdoor terrace.

Click to view article: https://www.realcommercial.com.au/news/sydney-icon-bill-tonis-cafe-and-restaurant-up-for-sale

The campaign and prosperous sale of 19A Boundary Street is the latest coup for emerging Sydney agency Mercer Property. On the surface appearing like any other multi-million dollar property exchange, behind the scenes displays the inner workings of a high profile play more than a decade in the making. And at its core, the longstanding relationships that made it happen.

“Our whole business is built on solid relationships,” asserts Mercer Property director Tom Speakman. “Having a good track record, possessing sound industry knowledge and most important of all – being honest and establishing trust – is hugely important. It’s key to how we secured this sale.”

A former warehouse converted into stylish office spaces within the heart of Sydney’s creative district, Speakman’s history with the boutique Darlinghurst building stretches back to 2008, when it was owned by the Roney Family of Boundary International.

“Over the years we became really good friends with the onsite building and facilities manager,” says Tom. “As an up-and-coming leasing agent it was a great place to cut your teeth; managing smaller leasing transactions, building a rapport with tenants and gaining sound occupancy knowledge.”

All this would prove highly fortuitous for Mercer Property. In 2017, one of the agency’s long term clients, Haben Fund, were offered the building off-market and approached Mercer for advice on the purchase.

“They wanted to get an understanding of how the tenancies and occupancy rates had fared throughout the life of the building,” Tom recalls, “and were interested to know where we could drive the rents to.”

“It was an opportunistic time for them to buy, because we were going through a very bullish leasing market. We had an influx of tenancies pushing out to the city fringe right when they were acquiring the site. That really allowed us to push the rates from $650 per sqm to around $800. It was highly rewarding to be able to deliver these profits to Haben, who happened to be one of my first ever clients.”

Fast-forward to December 2019, Mercer Property’s successful rental growth forecasting had placed the agency in good stead as front-runners to dispose of the asset for Haben. Teaming up with Harry George of CBRE, they successfully negotiated the sale to private Melbourne investor Marks Henderson for $92.75m – with a tight initial yield of 4.7% and a build rate of $14,300 per sqm.

“Given that we’re essentially a brand new agency, we wanted to make sure we didn’t leave any stone unturned and got the best price for our clients,” explains fellow Mercer director Matt Davoren of the CBRE partnership. “We have done transactions with Harry in the past and found him to be a very efficient, well-connected agent who has a lot of synergies with our own business.”

Continuing its longstanding relationship with 19A Boundary Street, Mercer is now managing the property for Marks Henderson for the foreseeable future. Recognised as one of the premier creative buildings in the city fringe that has always secured strong tenancies, it’s clear why 19A Boundary was such an attractive purchase for the Melbourne based group.

From its high ceilings and polished concrete floors, to exposed services, beautiful district views and the unmistakable sense of character, the building’s strong appeal for businesses such as creative agency Collider and chef Donna Hay is obvious.

“In the last two years the property has run at a 97% occupancy rate,” says Davoren. “It has a collaborative community feel. There are tenants who have been in the building for over a decade and we’re always hearing from prospective companies who are itching to get in because they love it so much. It’s always been an exceptional building that attracts strong tenancies.”

Sydney’s commercial scene is rapidly changing. As property prices in the CBD and its fringes continue to skyrocket, creative industries are seeking new, exciting and affordable locations to match their vibe and vision. Enter Precinct 75: A vibrant business hub in St Peters offering an exciting alternative to traditional business districts, taking cues from regeneration projects such as the famous Brooklyn Navy Yard. Conveniently positioned just 7km from the CBD and 5km from Sydney Airport, Precinct 75 is home to a diverse community of over 70 creative businesses ranging from design, marketing and media to hospitality, retail and fashion.

“Our vision for the property when we acquired it five years ago was always to transform it into a unique creative district,” says Jason Varker-Miles, owner of Precinct 75. “We wanted to establish a place where creative businesses could operate. So we weren’t looking for lawyers, doctors and accountants, but the makers, the creators – people that could create a real community. And proudly that’s where we’ve gotten to today.”

Rich in history and character, the aesthetic appeal of Precinct 75 for the creatively inclined is obvious. Home to the original Taubmans paint factory from 1902 until the early 1960’s, the discerning site regeneration has preserved its rich heritage: 12 character buildings holding 80 suites that flaunt soaring ceilings, beautiful exposed brick and timber and raw finishes. George Henry Taubman’s original office and meeting room (now where Varker-Miles oversees Precinct 75) has also been respectfully restored, while still retaining its stunning American Oak walls – a loving ode to days of yore.

“The unique look and feel of Precinct 75 is definitely one of the factors that attracted us to the place,” admits Eric Phu, co-founder of ethical t-shirt company, Citizen Wolf. “The suite we took over is an amazing space. It’s very open and spacious, has great bones that we could work with and is big enough for our needs. We also love the amenities here – everything you need is already onsite. We love the Sample Coffee Cafe and are often at the bakery or brewery.”

Yes, brewery. Just one of the many renowned local brands that call Precinct 75 home, Willie The Boatman is a local craft brewery where “terrible jokes and unbeatable beers take shape.” Founder Pat McInerney said he fell in love with the place as soon as he saw it. “It’s cool and rustic and really fitted with our brand and what we were looking to grow into. We make all our beer and cider on-site…and also wine for those poor fools who don’t drink beer.”

As any business owner will attest, accessibility is key, and Precinct 75 delivers on that front too. Just a short walk from both Sydenham and St Peters train stations, the complex also enjoys city buses right on its doorstep. “It’s such a great location,” adds McInerney. “You can walk to King Street in Newtown in just 15 minutes.”

Looking ahead, Jason Varker-Miles holds a grand vision for the precinct, despite already being an established and sought-after business hub. “Our plan is to go one step further,” he reveals. “With such a large piece of property, we are in a unique position to provide a thriving urban village and community that includes apartments, restaurants, parks and additional commercial spaces. This is still sometime down the track, but we’re excited for the future of Precinct 75.”

To make your mark on this highly-desired destination precinct, speak to Matt Davoren or Tom Speakman, Directors of Mercer Property, or find out more here.