Ex-Le Cornu site at North Adelaide could be sold for up to $37 million

AS property experts reveal how much they believe the former Le Cornu site in North Adelaide will set back ratepayers, read the remarkable list of delays to hit the site — dating back to 1991.

• Adelaide council to buy ex-Le Cornu site in North Adelaide
• $200m hotel development for Le Cornu site dumped

SA PROPERTY experts believe the empty patch of North Adelaide land — labelled an “embarrassment” and being purchased by the city council — will set ratepayers back at least $30 million, if not a higher estimate of $37 million.

The City of Adelaide’s plans for the Le Cornu site at 88 O’Connell St include redeveloping it in line with its aspirations of better livability and growth.

Figures from the property sector based on land value and recent sales show the site is worth between $30-$45 million, without considering its development potential.

Taxpayers will also have a stake in the development after SA Premier Jay Weatherill announced a $10 million contribution to convert the site into a “usable space for the whole community”.

“This development will reinvigorate North Adelaide, and encourage more people to live in and visit the area,” he said.

“It will create jobs in construction over the development phase and once complete. Through community consultation we will see the site develop in line with what the community wants, after so many years of inactivity.”

It is believed the purchase — after years of inaction at the site overlooking the CBD — has been driven by the burgeoning commercial and construction activity immediately to the north and south of the site.

Prospect Rd, in particular through its ‘Village Heart’ has undergone a wholesale transformation over the past couple of years with shop and business occupancy leases standing at more than 99 per cent.

The Palace Nova cinema, which opened in Prospect last week, has already proved a huge commercial success with its ground floor already leased to cafes and restaurants.

Prospect has a new, super fast wi-fi network to benefit local businesses and customers.

The City of Adelaide recently unveiled its own ambitions for a superfast internet network in partnership with TPG Telecom.

To the south, the Riverbank precinct development and the uplift of the northwest end of North Terrace will again have stung the council and government into action, said a source who labelled the empty 7535 sqm site, astonishingly vacant since 1989, “an embarrassment”.

Owner Makris Group has reached a conditional agreement with the council.

“It has been my long-held dream to create a landmark project for North Adelaide and SA on the site,” Con Makris said.

The old Le Cornu site, now vacant land on O'Connell Street, North Adelaide.

However a recent landmark project, as with everything before it, came to nothing.

The 2016 plan was for a $200 million mixed use development project with 131 residential apartments spread over three separate buildings and a 160 room, five star Sheraton hotel. It also included 3000 sqm of premium office space, 3000 sqm of retail space framing a landscaped piazza and 441 car parking spaces, an imperative given the general shortage in the area, but never materialised.

“Because of a recent opportunity I have made the decision to work collaboratively with the Adelaide Council to use the former Le Cornu site for open space and community use and to relieve the extreme parking issues and pressures in North Adelaide,” Mr Makris said.

“I am pleased to be in a position to assist the site’s transfer to the community at a price the Council can afford.”

Le Cornu site’s lengthy list of delays

April 1989: 1.6ha Le Cornu Furniture store, which had been in the retail family for 134 years, sold for an undisclosed sum to merchant bank Tricontinental (Trikon) and Oberdan family’s Kellyvale Group.

October 1989: Plans approved by Adelaide City Council for a $40 million shopping centre and townhouse development.

February 1990: Kellyvale take full ownership of site after Trikon’s financial collapse.

April 1991: Planning Commission rejects complex despite modified version already approved.

December 1992: Oberdan Group reveal plans for a $22 million retail complex including a major Coles supermarket and 30 speciality shops which replaced its earlier proposal.

May 1993: State Government strips Adelaide City Council of control of site after months of bitter debate.

August 1993: Contentious plans approved by Planning Commission after developers’ appealed rejection a month earlier.

October 1993: State Government gives final approval despite claims from North Adelaide Residents Group, led by Susan Clearihan, now a city councillor, they were not consulted.

November 1993: Residents and eight companies, including Foodland, launch Supreme Court challenge, in a state first.

May 1994: Unprecedented class action dismissed by Justice Trevor Olsson.

October 1994: Appeal dismissed by Full Court of the Supreme Court.

October 1995: Demolition work begins on site’s dilapidated buildings after months of wrangling.

March 1997: State Government announces area will be rezoned from a residential/commercial

precinct to a predominantly commercial area.

June 1997: New $15 million project including group of four boutique cinemas and underground car park proposed by Wallis Theatres and Kellyvale holdings.

December 1997: Mancorp Holdings headed by developers Theo Maras and Bill Manos launch legal appeal against council’s approval, arguing project exceeded building heights. It was later resolved.

March 1998: Oberdan family’s Kellyvale Group sells site to the Wallis Theatres Group.

August 2000: O’Connell St Traders’ Association lodge formal application with the city to establish temporary car park.

November 2001: Makris Group buys site from Wallis Cinemas for an estimated $7 million after council drops bid for land.

January 2005: Makris group unveils $100m luxury complex including seven-star luxury hotel, retail shops, apartments, cinemas, restaurants and a three-level underground carpark.

May 2007: State Government fast tracks plan, takes planning control from Adelaide City Council and gives it major project status.

April 2010: Con Makris describes saga as “the biggest disgrace in Adelaide’s history” as it starts demolition work on site.

August 2010: Makris group wins two-year extension, in which substantial work was to start.

November 2011: Luxury complex plans scrapped because of global financial crisis.

December 2011: Deemed a “catalyst” site under new State Government planning laws meaning it does not have any height restrictions.

July 2012: Billionaire property developer Lang Walker and Mr Makris announce joint venture to develop the site.

January 2013: Mr Makris publicly airs frustration over delays and threatens to develop alone.

June 2013: Mr Walker walks away from joint venture plan.

July 2014: $80 million proposal from Adelaide City Councillors Sandy Wilkinson and Mark Hamilton to build a public square, carpark and luxury apartments on the site, with the council as the developer.

August 2014: Mr Makris claims he will scuttle plans for a Glenelg-to-Kangaroo Island ferry if he fails to win development approval for the site.

October 2014: Issue dominates city elections amid calls for the council to compulsory acquire site.

December 2014: Mr Makris unveils new $200 million, eight-building shopping and residential development.

November 2015: 160-room Sheraton Hotel announced for site

August 2016: Makris Group misses deadline to begin work, given one-year extension

July 2017: Makris Group abandons plans for $200 million shopping and residential complex

December 2017: Adelaide City Council to buy site from Makris Group, with $10m from State Government

[e-mail]