Developers Eye-Off Oxford St

by John Moyle

Oxford Street is still reeling after the City of Sydney recently put three blocks of council-owned prime location retail and commercial premises up for expressions of interest for a 99-year lease.

“It’s effectively selling them off, as 99 years is more than any of our lifetimes,” Councillor Professor Kerryn Phelps said.

The shops and commercial premises occupy 40 per cent of Oxford Street’s northern side between Oxford Square and Taylor Square and currently houses 14500 sqm of retail shops at street level, and start-ups, arts organisations and small businesses in the upper levels.

The three properties are at 56, 76, 82, 106, 110 and 122 Oxford Street.

The expression of interest calls for an experienced operator with a ’strong track record in redeveloping and refurbishing heritage buildings’ in exchange for the lengthy lease.

The Lord Mayor Clover Moore said: “The potential redevelopment of these properties is an exciting opportunity that will provide opportunities for local residents, attract greater numbers of visitors and help boost the local economy.”

The notion that something needed to be done with the premises is nothing new.

“I’ve been campaigning for Council to apply the successful QVB model to our Oxford Street property portfolio since 2012,”City of Sydney Councilor Christine Forster said.

It would be an understatement to say that this section of Oxford Street is in need of some love and an injection of retail knowledge, but when looked at closely, it seems that this call from the City of Sydney is a desperate last minute proposal to rid itself of a problem largely of its own making.

This section of Oxford Street has been in commercial decline since the lock-out laws and has seen many of its iconic gay businesses and food and fashion destinations fold or relocate.

The three blocks were originally owned by the City of Sydney, transferred to South Sydney Council when it was formed in 1968 and later retuned to the City after a merger in 2004.

Sax Fetish has been located at 110 Oxford Street for around 40 years and its current owner has been renting from City of Sydney for 18 years.

“Decency and modesty would prevent you from publishing what I think of my relationship with the City of Sydney as a tenant,” owner, Sax Fetish, Wayne Nicol said.

“They are the worst landlords that have ever walked the face of the earth.”

This view is common among others who have rented in the area.

Stephan Gyory who owns The Record Store, located nearby in Goulburn Street said: “Council haven’t renovated their buildings and they have been in limbo for at least the 12 years that I have been in the area.”

Wayne Nicol says that no major maintenance has been done on his premises for many years.

“My block has been in decay for years and during that time I have seen four lots of plans and hundreds of thousands spent on consultants and nothing has happened,” Wayne Nicol said.

Cr Prof Phelps said “It is in this dilapidated state that these buildings are to be offered for leasing with nothing to show the ratepayers of Sydney except a reported $40 million spent on reports, refurbishment proposals and activation programs.”

Last year a 250kg key stone fell out of its position above Sax Fetish, crashing through the awning onto the footpath below.

“If someone had of been killed the blood would be clearly on the hands of the Lord Mayor,” Wayne Nicol said.

“The condition reports were listed as average to poor with 110 being rated as poor, and for the Council to own property in such a prime position and then let it fall into a state of disrepair is an inexcusable waste of ratepayers resources,” Cr Prof Phelps said.

Not only has the City of Sydney been derelict in its maintenance of the Oxford Street properties but it could have managed its own information better by informing its tenants before issuing the press release.

“The first time I knew about this was from a mail-out from the Darlinghurst Business Partnership, and it came as a surprise,” Wayne Nicol said.

“The tenants are pissed off and upset and angry and are worried about their futures,” Stephan Gyory said.

When City Hub visited the properties last week it found that almost half of the upstairs spaces were unoccupied and many of the street level shops vacant and pasted over with ‘Creative Sydney’ posters.

When questioned about protection for low income tenants, a City of Sydney spokesperson said: “We do insist that the creative spaces currently offered by the City to creative and artistic groups for affordable prices to be retained in the new development.”

Wayne Nicol said that a developer’s dream could come true because while two of the blocks have considerable heritage protection, his only has the frontage protected leaving the opportunity “to put a modern building behind, and bang – you’ve got multi-million dollar harbour views.”

According to a City of Sydney spokesperson the Council owns 250 buildings valued at around $2 billion, with annual rental income of around $72 million.