Woolloomooloo brothel tipped to fetch $5 million or more

The latest brothel to be put up for sale, the Five Star City, on Cathedral Street, has a price guide of $5 million or more and the agents admit it will likely be turned into something else.

The property at 110-112 Cathedral Street, Woolloomooloo, is being sold in a joint campaign run by Mr Ippolito and Anson Kolb, director of 365 Property Group.

The two adjoining terraces – which are separately titled – are being sold on behalf of the longtime owner of the Five Star City brothel and are being offered with vacant possession.

Domain Group records show that the owner acquired 112 Cathedral Street for $800,000 in 2006.

Mr Kolb said that No.110, which was acquired for $1,787,500 in 2016, is owned by owner’s self-managed super fund.

A new owner could set up their own brothel operations at the site, as a brothel licence is included in the sale. Mr Kolb said the current operator might also be amenable to continuing on as a tenant.

“He wants to retire soon and wants to offload the properties now, but he’s willing to do a sale and leaseback. It’s all very flexible,” Mr Kolb said.

‘Bring your architect’

But Mr Kolb thinks it more likely the mixed-use site would be converted to a new use – with interest already coming from builders and residential owners.

“I don’t know if a brothel operator will buy it, but we’re willing to entertain anyone who is interested,” he said, adding that the property would be suitable as a boarding house, boutique hotel or residential conversion, subject to council approval.

“[We’re telling people to] bring your architect. It’s a blank canvas – they could do a leaseback, maybe a short delayed settlement, while they decide what to do with the property.”

The recent announcement that the state government would roll back lock-out and last-drink restrictions for areas of the city including Woolloomooloo had given the site’s hospitality credentials a well-timed boost.

“For someone who is thinking a little boutique hotel with a bar or a tapas bar, it would be ideal,” Mr Kolb said.

The site could also be converted into office space. Mr Ippolito said the area was becoming increasingly popular with creative industries lured by its proximity to the CBD and the more affordable prices than neighbouring Darlinghurst.

When it’s gone, it’s gone

There are about 40 legal brothels operating in the City of Sydney council area, which includes Woolloomooloo, according to a council spokesperson, although keeping track of how many brothels are actually operating is difficult.

“Business operators generally have no obligation to notify the City when they cease operating or when a business changes hands,” said the spokesperson.

Five proposals for new brothels were approved between June 2009 and June 2019, according to the council, with a further 39 existing brothels being approved for an extension of hours and alterations.

If the Woolloomooloo property does sell to another brothel operator, Mr Ippolito believes it will be because of the scarcity of licensed venues remaining in the area.

“We’ve been operating in the inner-east market for years and I can’t think of an example of a new licence being issued,” he said.

He sold the sex shop and adult entertainment club, the Pleasure Lounge, on Oxford Street, in 2014 to a buyer who “was attracted to the licence” attached to the premises.

“Once that licence is gone, it’s gone. If you were to lodge a DA for a new use, council would never approve another licence for that venue again.”

Sex and scandal 

Sydney’s inner east, in particular Potts Point, Woolloomooloo and Darlinghurst, had a strong association with the sex industry.

Organised crime boss and well-known brothel madam Tilly Devine was so closely associated with the area in the late 1920s and early 1930s that she was often referred to as the “Queen of Woolloomooloo”.

“I believe at one stage there were about four brothels within a couple of doors of one another on Cathedral Street,” Mr Kolb said.