Stockland hits new heights as North Sydney's tallest building approved
Stockland has won planning approval for North Sydney’s tallest office tower, its 51-storey Affinity Place project, but the property development and management company is still at least two years away from proceeding with construction.
Gavin Boswarva, the executive general manager for commercial property at Stockland, said productive discussions were being held with prospective tenants, a process that would accelerate now the development approval from North Sydney Council has been obtained.
“Obviously securing this DA is a major milestone,” Mr Boswarva said. “The board and executive committee are 100 per cent behind the project and pursuing tenants.
“I think the key thing with all projects of this scale, circa $1 billion, [is] no owner is going to write you a blank cheque.
“We started dialogue with tenants six or eight months ago and have had a lot of good interest.”
Affinity Place is one of three major office projects on Walker Street and part of wave of investment into North Sydney property that has followed the state government’s commitment to Victoria Cross Station.
The station is scheduled to open in 2024 and will offer regular, rapid services to Barangaroo and Martin Place in the CBD, three to five minutes away by train, while connecting with Crows Nest, Chatswood and the Sydney Metro Northwest line.
“That infrastructure is a game-changer for North Sydney at the end of the day, there’s no doubt about it.”
Mr Boswarva said the approved tower design has an estimated end value of $1.4 billion, and includes 59,000sq m of net lettable commercial office and retail space.
The building will have 1200sq m floor plates, a rooftop sky garden, and views of Sydney Harbour across to the CBD, where prime grade office space typically costs 20 per cent to 30 per cent more than in North Sydney.
However, he said while North Sydney offers a more economic alternative, often with better views, cost was not front-of-mind for prospective tenants, many of whom were still working through their future office requirements, in terms of both space and amenity.
“We’re not seeing that tenants are looking to cut costs. Individual tenants and what they’re looking at post-COVID is still [uncertain],” Mr Boswarva said.
“I don’t think anyone in the market can definitively say ‘this is what’s happening tomorrow’.
“But the one thing that is definitely resonating is that tenants want to ensure the workplace they provide their employees is something they want to be part of.”
The tower will be built on a 2300sq m site encompassing three buildings, one of which Stockland has owned for more than 20 years and another two it bought in late 2019 for $121 million, at 110-122 Walker Street.
Nearby, private developer Billbergia is well advanced on its 50-storey tower at 88 Walker Street, while in late April Third.i received planning approval for a 22-storey office tower at 63-83 Walker Street.
There are many others in train in the area, with up to $11 billion of commercial and residential developments planned in North Sydney according to estimates.
For Stockland, the North Sydney project is part of a broader push into commercial office development, a sector it has been underrepresented in the past.
Its other two major office projects are M_Park in partnership with Ivanhoe Cambridge at Macquarie Park, now under construction, and the planned redevelopment of its Picadilly Complex in the Sydney CBD.
