$800m remedy for one of the city's least lovely sites
Ben Schneiders and David Rood
October 31, 2006
ONE of Melbourne's oldest and ugliest "bomb sites" finally appears set to be redeveloped, with an $800 million office and retail plan for the corner of Swanston and Victoria streets.
Developer Grocon confirmed yesterday it had paid $39 million to RMIT for most of the former Carlton and United Breweries site, in a deal approved by the State Government.
RMIT will retain a prime part of the site to build a postgraduate research centre. However, most of the redevelopment of the site, which was demolished in 1989, will be on Grocon's portion.
The 1.9-hectare site, of which Grocon has bought 1.6 hectares, has become an embarrassment to governments with a series of proposals not getting off the ground. A casino, a head office for John Elliott's Elders and a new headquarters for ANZ are all failed projects for the site.
Grocon managing director Daniel Grollo said yesterday he hoped to start building by the end of 2007 — once the proposal had gone through the planning process. The project would be on a similar scale to Grocon's QV development, he said.
The proposal is to include a series of lanes as well as a mix of office, retail and residential space and to have a tower at the city end that will rise as high as 50 levels.
"It will have varying heights obviously diminishing out to Carlton," Mr Grollo said.
The buildings will fall to between 15 to 20 levels in the middle section of the development and 10 to 12 levels at the Carlton end. Mr Grollo said there would also be a public promenade extending from Swanston Street with views of the Shrine of Remembrance.
The project's design could change because of the planning process and the demands of future tenants, he said.
The Grocon proposal would "extend and bridge the CBD grid and Carlton grid" said project architect Roger Nelson, from NH Architecture.
A property source said it was a "bold move", particularly as he believed it was not the best location for office development. "I don't think it would be a good idea," the source added.
Possible corporate tenants include Westpac, Commonwealth Bank and Australia Post, sources said.
Grocon's David Hodgson was confident about the project's prospects despite its speculative nature.
He said it would include 120,000 square metres of office space, 60,000 of residential, 12,000 of retail and 1500 car spaces. The project could include as many as 600 residential units, although whether they were aimed at students, were serviced apartments or for some other market would depend on industry conditions, Mr Hodgson said.
RMIT vice-chancellor Margaret Gardner said the university's section would focus on postgraduate research.
The sale is welcome news for the university, which is recovering from a troubled financial past stemming from a faulty computer system that caused a $17.7 million loss in 2002.
Professor Gardner said RMIT posted a surplus of more than $25 million at the end of 2005 and expected a similar result this year. "This sale is not about RMIT's financial position. We conducted a property survey in 2003, which identified how much property we needed to retain," she said.
The university bought the site in 1998 for $25 million. The money from the sale will be reinvested in capital works and facilities.
The redevelopment of the site will retain the heritage aspects of the old Malthouse theatre and the bluestone wall fronting Bouverie Street, Mr Grollo said.