To seal the joint venture, Walker Corporation in February acquired a half share of Goods Shed North at 710 Collins Street from an Abacus-controlled entity for $56 million.
The joint venture will build a tower above the existing heritage shed, connected under the elevated portion of Collins Street to Collins Square.
“What you’ll see on both sides of the road will be a development above or around the building that basically enshrines and, if you like, enhances or renovates the heritage component … and fully integrates it into whatever the end result will be,” Mr Sewell said.
“The prospect, that is in early stages of planning, to incorporate the Goods Shed with the adjacent major Collins Square development is something that really drove our desire to work in partnership with Walker,” he said.
To facilitate the deal, Abacus provided vendor finance to Walker Corporation for up to five years at an interest rate of 5.5 per cent per annum, reflecting Abacus’ current yield on the asset.
Abacus has been in an expansive mood of late. It settled the final tranche for a 32 per cent $202 million stake in the tower at 201 Elizabeth Street in Sydney in a Charter Hall-led consortium. It funded the purchase with a combination of debt and divestment of non-core assets.
The consortium will hold the building with the intention of redeveloping it down the track.
Another Sydney development likely to move ahead is Oxford Properties Group’s 39-storey office tower above Sydney Metro’s future Pitt Street Station.
The Canadian-based fund manager’s plans for an over-station development, lodged in July 2020, were approved recently. The Foster + Partners design puts a 177-metre building with 55,743 sq m of ground floor area including the train station, mezzanine, plant levels and two sky lobbies on the L-shaped block.
