This article is from the Australian Property Journal archive
MOST recently owned by collapsed developer Steller, the former site of the Greyhound Hotel in St Kilda has sold for $6.25 million.
Located near the corner of Brighton Rd and Carlisle St, the 911 sqm property was home to the popular pub for 163 years until its controversial demolition in 2017 under the ownership of Will van der Linden.
CBRE’s Julian White, Mark Wizel, David Minty and Chao Zhang handled the sale through a mortgagee auction to developer Julian Rosenfeld.
Steller creditor, Sydney-based Atlas Advisors, took possession of the failed company’s 16 sites it had first mortgage over and appointed receivers KordaMentha. They included the former Greyhound Hotel site, and properties in Cheltenham, Preston and Keilor.
The 1 Brighton Rd property has commercial 1 zoning and three street frontages, and has a permit for a seven level building with 34 apartments and three shops.
“The activity and energy in the bidding is a clear sign of changing market sentiment in the development sector,” White said. “Off the back of healthy residential auction clearance rates, with volume levels now at comparable levels to 2018, developers have gained a lot of confidence and are actively pursuing their next sites to take into the new cycle.”
Steller had paid $7.5 million for the property two years ago shortly after the permit was obtained.
Previous plans for an eight storey building with 43 apartments and five retail spaces were rejected by Port Phillip Council in 2018 with a recommendation for a five level building.
However, the Victorian Civil and Administrative Tribunal allowed for the bulkier curreny plans. Despite widespread community objection the Hotel was knocked down. It had been built in 1853, but its 1936 refurbishment provided a roadblock to it achieving heritage protection.
Steller once had a $4.2 billion pipeline of apartment projects, mostly through Melbourne’s middle suburbs, and collapsed earlier this year amid tough sector conditions and a fallout between founders Nicholas Smedley and Simon Pitard.
Multiple site earmarked for development were subsequently listed for sale, including 200 Wells St in South Melbourne, for which it paid $23.4 million less than two years ago, and the Continental Hotel in Sorrento, abandoning the $80 million overhaul of the iconic venue being undertaken in a partnership with Julian Gerner.
Another major lender to Steller, OCP, took control of Wells St and sites in Hampton and Richmond, and appointed McGrathNicol as receiver over 13 entities associated with Steller. Pitard has sought to keep the construction arms afloat.
New Zealand-listed Ryman Healthcare has just picked up a 1.2-hectare site in Highett from Steller for $28.5 million for a new retirement village.
