Plans for a $2 billion hotel and apartment skyscraper have been shelved after the Victorian government refused to extend a development permit for the site.
The Melbourne Southbank proposal from Crown Resorts and the Schiavello Group involved 388 hotel rooms and 708 apartments in a 90-storey building reaching 323 metres – outstripping Australia’s tallest building, Q1 at Surfers Paradise.
Crown Resorts was granted approval for the One Queensbridge complex in early 2017 despite the tower exceeding Victorian planning limits, state premier Daniel Andrews defending the decision at the time saying the development was of “state significance”.Despite Crown’s lofty ambitions, it has since failed to attract sufficient financial backing in the climate of a declining luxury unit market and a softening of room rates driven by new hotel openings.
A lending clampdown by the banks and a decline in Chinese buyer interest has led to a dearth of cashed-up investors.
Crown submitted a bid to extend the construction start date from March 2 but revealed this week: “Crown and Schiavello have been informally notified by the Victorian government that an extension to the construction commencement date for the proposed One Queensbridge project has been denied”.
The company retains a 50 per cent ownership in the land opposite Melbourne’s Crown Casino, a statement saying it will “consider the next steps” in conjunction with Schiavello.
Sales of apartments at the Crown Sydney Resort in Barangaroo South are reportedly progressing well, prompting industry insiders to speculate the James Packer-backed company may sit on the One Cambridge site until the next cycle of apartment growth comes around.
According to The Urban Developer, Crown is not the only major player currently experiencing funding issues over luxury apartment projects in the city.
It reports Jeff Xu’s Golden Age Group last week abandoned a $600 million residential project at 85 Spring Street, instead opting to sell the asset to free up funds for commercial assets.
Developer Woodlink also scrapped plans for a $360 million residential development of Illoura House on St Kilda Road, instead opting to list the property.