This article is from the Australian Property Journal archive
FURTHER change is sweeping through Sydney’s Oxford Street, with plans unveiled for the mixed-use redevelopment of arthouse cinema Verona that will deliver retail and rooftop dining, entertainment and boutique commercial office space to the iconic strip.
The eight-level project at 17 Oxford Street, Paddington is billed as the first-ever large-scale commercial office in the suburb, set to deliver over 3,500 sqm of workspaces and retail, looking to capitalise on the demand for premium office space on the city fringe. It will also feature 1,000 sqm of cultural entertainment space.
Palace Cinemas acquired the Academy Twin cinema in 1995 and architects Tonkin Zulaikha Greer designed the purpose-built four-screen Verona complex, which famously brought Hollywood glamour to Paddington – it was opened on Valentine’s Day in 1996 by Nicole Kidman, who was hosting the premiere of her movie To Die For, with her then-husband, megastar Tom Cruise in tow.
The cinema held its final screenings on Sunday night. Palace hopes to reopen the cinema at the Entertainment Quarter.
The 1,138 sqm corner site was put to the market in 2021 by previous owner Robert Bleakley, founder of Sotheby’s Australia Fine Art, and snapped up by private development companies WT Malouf and Fenbury for $30.8 million.
Verona sits within a fast-changing stretch on and around Oxford Street where the City of Sydney eased development controls in a bid to breathe life back into the tired nightlife hotspot. Adjacent to Verona will be Sydney’s first 25 Hours Hotel, being developed by Central Element and Boston Global, which is set to open in December this year and deliver a new 109-room hotel with retail and wellness facilities. Oxford House is also nearby at 21 Oxford Street and features a 56-room hotel with a courtyard pool, poolside bar and all-day diner.
Further along the strip, multinational music companies Sony Music Entertainment, Sony Music Publishing and The Orchard are relocating their Australian head offices and studios to AsheMorgan and Toga’s development at 60, 90 and 120 Oxford Street. Melbourne’s world-famous croissanterie, Lune will also open within the retail component.
The long-term home to Sydney’s LGBTQIA+ community, Oxford Street received a major boost as the home to last year’s WorldPride event. However, Two pubs in the heart of the precinct were sold by MA Financial Group in September for $61 million, less than what it paid three years earlier, after it lamented at the slow revitalisation of the strip’s Taylor Square.
Designed by architects practice Scott Carver, Verona will feature two levels of subterranean cinema spaces and cultural retail on the ground floor. Four levels of commercial office space will sit below a 620 sqm rooftop activated with quality food and beverage offerings and boasting views of Sydney’s Harbour and CBD.
According to the architects, the design pays homage to the site’s cinematic history while reimagining it as a vibrant, mixed-use cultural hub.
“This project is an amazing opportunity to reinvent and redefine the next generation of cultural experiences on Oxford Street. It anchors the eastern end of the City of Sydney’s Oxford Street renewal and will help people rediscover one of Sydney’s most creative and culturally significant areas,” said Doug Southwell, project architect and co-managing director of Scott Carver.
The design will retain the historic former brick façade. Built in 1946, Verona was initially operating as an industrial facility before becoming the iconic cinema.
The ground floor was also the site of the first Mambo retail store – a lifestyle brand created by Australian artist and Mental as Anything band member Reg Mombassa. Since its closure in 2006, the space has hosted pop-ups for a range of global brands including Chanel, Google, Tommy Hilfiger, and Deus Ex Machina and has also been used as a television studio for Channel 9 productions.
Market ready for new offices: agents
Verona will deliver office space with floorplates ranging from 523 to 822 sqm and some floors offering outdoor terraces. There is also the potential for inter-connectivity to provide contiguous space for large, multi-floor tenants.
Rental rates for Verona are undisclosed, but are expected to align with prime commercial office space in Darlinghurst and Paddington currently achieving net rates of between $1,100 to $1,500 per sqm.
“It’s a compelling opportunity, there’s simply no office space of this scale available in Paddington,” said Tom Speakman of Mercer Property, which is marketing the space alongside Knight Frank.
“It’s bringing city-style space to Paddington and the market is ready for it. We’ve already dealt with a broad mix of potential tenants across the sporting, entertainment and medical sectors given Verona’s proximity to major amenities.
Early enquiry has been received from tenants across a range of industries given the development’s proximity to Sydney Football Stadium, Fox Studios and St Vincent’s Hospital in Darlinghurst, according to the agents.
“The tech sector is another with other fringe locations like Surry Hills and Darlinghurst at capacity,” Speakman said.
“Eastern Suburbs based CEOs are drawn to Verona’s proximity to home, reducing the commute and delivering greater work-life balance. It is an ideal opportunity for a boutique HQ,” he said.
Data from Knight Frank shows net face rents for city fringe space experienced an average growth rate of 6% over the last 18 months. Inner city suburbs recorded a 53% rise in population in the last 20 years, compared with a growth rate of 29% in greater Sydney.
