Amid large-scale public works and growth in Newcastle, a big pub freehold development opportunity has come to market leveraging planning guidelines.
The Cambridge Hotel occupies a prominent corner of Newcastle’s Hunter Street, adjoining the lot of 5-7 Denison Street, a two-level commercial office building plus parking. Together they comprise 1,942m² zoned B4 Mixed Use, with 60-metre height limit and 6:1 FSR representing potential of 11,652m².
The lot is opposite the under-construction Newcastle Interchange, due to open later this year, providing a heavy rail terminus and link with the Light Rail Network. Industry is booming in the area, led by the nearby Honeysuckle Business precinct and surrounding CBD developments.
Cambridge Hotel is a well-established live music pub boasting multiple bars in three distinct sections on the ground floor. The first level comprises 16 student accommodation rooms with common areas and amenities.
The hotel is mid-way through a 15-year lease, currently paying just over $222k in rent per annum. The freeholder retains the liquor licence and eight EGM entitlements.
A concept scheme designed by Webber Architects detailed a proposal for 153 residential apartments of one, two and three-bedrooms on the site, atop a revised pub and retail offering. Rumo P/L leasing the Cambridge state a “willingness to re-establish within a new project”.
Approximately 143 kilometres north of Sydney, the Hunter region is flagged as the strongest regional centre in Australia, with gross product surpassing $44bn and Newcastle the country’s seventh-largest city. Sources suggest the development opportunity could see the block fetch in the region of $8 million.
The freehold title was purchased in the 90s by a trio of local investors including Newcastle-based litigation lawyer John Palmieri, and has come to market through Colliers International’s Adam Leacy, who notes its advantages over an undeveloped passive investment.
“Key is that the property has income now, which allows time to work on the scheme,” said Leacy.
“It’s a unique chance to take this landmark property into its next lifecycle.”
The two titles are for sale via an Expressions of Interest campaign, closing Tuesday, 8 August.
