Sydney CBD strata office project on the radar of SMSFs
A $50 million strata office development offering co-working facilities and club-like amenities just off Martin Place is generating interest from small business owners, looking to own a slice of the Sydney CBD through their self-managed super funds.
W Property’s strata office development – the first in the Sydney CBD in almost a decade – will convert 49 serviced apartments in the former Adina Hotel (acquired for $30 million in October last year) into 42 boutique strata commercial suites ranging in size from 36 to 113 square metres and starting from just under $800,000.
“It’s a very common thing for business owners to buy strata offices in their SMSF and then rent them back to their own businesses,” said W Property co-owner Michael Williams.
“These are [typically] small to medium-sized businesses seeking a non-corporate type environment.”
W Property, which Mr Williams operates with his wife Prue, has already notched up a number of strata office sales at 1 Hosking Place since launching it as “The Merchant” at the start of April.
Early buyers at 1 Hosking Place include James McCourt, a director at commercial real estate firm Karbon Property. He paid $2.07 million – or $28,723 per square metre – for a 72 sq m office suite.
Each strata office will have its own bathroom, galley bar and balcony, amenities Mr Williams said were particularly appealing in a post-COVID world.
Tapping into the co-working movement, the Merchant will also offer occupiers communal workspaces and meeting rooms as well as a full-time concierge, café/bar in the lobby and end-of-trip facilities.
W Property’s previous strata office project at 350 George Street, completed in 2013 in partnership with ASX-listed Abacus Property Group, is now selling at $30,000 per square metre, making it the most expensive commercial strata space in Australia.
“We have a wait list of buyers for 350 George Street, with very few owners wanting to sell,” Mr Williams said.
“That provides strong evidence that there is high demand for quality strata space in the Sydney CBD, and hence why we have decided to do the nearby project at Hosking Place.”
This demand, he told The Australian Financial Review, had been boosted by the state government acquiring three strata office buildings in nearby locations at 37 Bligh Street, 300 George Street and 5 Hunter Street to make way for the Sydney Metro West station.
“Businesses in these buildings have to relocate by the end of the year, and we’re aiming to complete [this project] by year’s end. It’s all internal refurbishment.”
The strata suites are being marketed by Andrew Harford and Jessen O’Sullivan of Knight Frank in conjunction with Tim Noonan and Ben Kennedy of Noonan Property.
Mr Harford said there was a distinct lack of quality strata space in the CBD, particularly with the facilities that 1 Hosking Place will offer.
“This project will not only be the first new strata space to come to the market in more than a decade, but it will be a very different offering, which is something buyers are looking for,” he said.
Mr Williams said W Property would retain at least one office in the project after completion.
“We want a seat on the owners corporation and to have long-term involvement in the building to ensure it runs smoothly. It’s our reputation at stake,” Mr Williams said.
