Sydney waterfront retail precinct King Street Wharf could fetch for more than $130m

Tenants include Cargo Bar, Bungalow 8 and The Loft, Meat District Co which occupy their spaces until at least 2029.

The global property giant, which bought the leasehold for about $90 million in 2016, is offloading the asset as the fund life nears completion.

The precinct is 100 per cent leased to 14 tenants, with a net income of $6.3 million. Photo: Supplied

The property, which is 100 per cent occupied by 14 food-and-beverage tenants, is made up of two retail lots known as Precinct One and Precinct Three. They generate a net income of $6.3 million.

Investors are able to acquire the precincts individually or in one line.

Selling agent Simon Rooney, from JLL, said the strong trend in food and beverage consumption would benefit the waterfront precinct.

“(It) provides exposure to a high-growth segment of the retail sector. Cafes, restaurants and takeaway food have delivered the highest rate of annual spending growth of any retail category over the long-term,” Mr Rooney said.

“Major Sydney CBD retail assets are rarely offered for sale and we see this asset as an opportunity to gain exposure to the extensive urban regeneration which is occurring all around the Darling Harbour, King Street Wharf and Barangaroo precincts.

“New infrastructure, hotels and mixed-use developments will enhance the profile of the precincts and drive income growth for the asset.”

The nearby Barangaroo metro station is expected to be completed in 2024. Photo: Supplied

Co-agent Carl Molony, from Stonebridge, said the asset had an average tenure of 11.9 years to date and a weighted average lease expiry of more than 11 years.

“The asset strikes a rare balance of income security, growth and value-add potential,” he said.

“Since acquiring the premier waterfront restaurant and lifestyle asset, the vendor has successfully transitioned the offering and income profile to reflect its premium location within the Darling Harbour precinct.”

Built in 2001, King Street Wharf was a former maritime industrial area in the early and mid 20^th century and was redeveloped in the 1980s.

Food and beverage has been the go-to strategy for shopping centre managers to resist the threat of online retailing and for commercial buildings to remain competitive.