Tim Gurner targets Sydney CBD as office to apartment plays take off
Luxury entrepreneur Tim Gurner is in talks to acquire 189 Kent St for more than $200m and finish off the hard work already put in by developer Barana Group.
Multibillionaire unit tsar Harry Triguboff calls luxury entrepreneur Tim Gurner the future of the development industry – and he’s now showing the way with plans to buy up and transform the site of an ageing office block in the heart of Sydney into twin luxury apartment towers.
The move is one that office landlords and governments hope will be repeated by more developers as they chase new uses for city offices which are dealing with a rising tide of vacancy, and they seek to bring cities back to life.
Mr Gurner’s operation is in talks to acquire the building at 189 Kent St from businessman Greg Shand’s Barana for more than $200m.
The Melbourne luxury entrepreneur would take control of the property after years of work Barana has put into getting an apartment scheme approved and then add his own touches.
The move capitalises on an existing planning scheme but could light the way for a much broader overhaul that is expected to sweep central business districts in coming years.
Governments are trying to encourage workers back to city offices but are also preparing the way to allow more buildings to be converted into residential uses. This could help address low office occupancy and also boost residential supply in the face of the housing crisis.
But the apartment buildings that have replaced offices so far have been at the top end of the luxury scale.
They include Lendlease’s One Circular Quay venture where the developer has sold more than $1bn worth of units, and the former Coca-Cola Amatil building – also on Circular Quay – that was turned into the Opera Residences.
Apartments have also succeeded in Sydney on a former public-housing block – the Sirius Building – and the tower atop the former David Jones store being developed by Cbus Property.
The surge at the top end of the industry comes at a time when the broader industry is mired in difficulties prompted by rising interest rates, builder collapses and cost escalations.
Latest ABS figures show that NSW building approvals are stuck at a low level and developers face a tough time getting projects out of the ground.
The state had 47,200 new completions – only a small uptick and well below the 63,000 homes the state had agreed to deliver.
Industry body the UDIA said apartments were a crucial missing piece of the future housing pipeline but the sector was struggling under the weight of economic pressures and running 72 per cent below its peak.
Mr Gurner has defied the broader malaise and is expanding his luxury operation across the country. A successful bid for the site would bring his unique style to the heart of Sydney for the first time and add to a planned build-to-rent project in the city’s west.
The move on the Kent St building would be one of the biggest purchases in the city this year and would reaffirm confidence in the top end of the unit market. While much of the market is in recovery mode, the luxury end has had a surge in mansion and apartment sales, notably in the CBD and at Barangaroo on Sydney Harbour.
The off-market sale is being handled by CBRE agents Justin Brown and Ben Wicks but they declined to comment.
Barana, controlled by Greg Shand, in 2021 won approval to alter the design of a long planned mixed-use development. The company has plans for an FJMT-designed complex with two separate towers.
The scheme would involve 31-storey and 27-storey towers beside each other, with Mr Gurner likely to add his own influence. He is known for high-flying projects like the $550m Saint Moritz project in Melbourne’s St Kilda, and schemes at sites such as the city’s Jam Factory and his Budds Beach site on the Gold Coast.
The Gurner operation struck more than a dozen acquisitions of sites around Australia last year, and launched a high-end $150m health, wellness and anti-ageing brand called Saint Haven.
Mr Gurner is known not only as an up-market developer but also for cultivating his brand, and he has invested in lavish bars and new-age health pursuits.
Mr Gurner has previously predicted that residential property would boom on the back of the lack of supply coming on to the market, and pent-up demand from buyers and renters arriving in Australia from overseas.
He was coy about the Sydney play when contacted by The Australian.
“We are unable to comment on any recent acquisitions in Sydney, and we can confirm that we have not yet signed, finalised or approved any recent deals,” he said.
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