Developers eye Packer HQ

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The Park Street headquarters of the Packer empire could soon be reduced to a pile of rubble only to be reborn as apartments to take advantage of the residential redevelopment of the area around Hyde Park.

AMP Capital Investors bought the building, 54 Park Street, which overlooks Hyde Park, for $50 million in August. The tenants - including PBL Media - are said to have signed three-year leases.

Dale Phillips, the manager of the fund, told BusinessDay the property was earmarked to be converted into apartments after the leases expire. He said that discussions were continuing with the tenants about extending the leases after the 2013 expiry, but a deal was yet to be confirmed.

The Park Street bunker has had a colourful history. It was the site of a daring gold bullion heist in 1995 when thieves broke into a safe in Kerry Packer's office on the fourth floor and stole more than $5.4 million in gold bars.

It was also where the late tycoon famously put the cheque from Alan Bond for his $1 billion sale of Channel Nine on the back of his private toilet door.

However, demand for apartments around Park, Liverpool and College streets is increasing more quickly than demand for office blocks.

The owner of the tower, AMP's unlisted opportunity fund, called Select Property Portfolio No.3, has 45 assets in its portfolio which includes The Residence Hyde Park (apartments), 30 The Esplanade, Perth, and 54 Park Street.

Mr Phillips said sales at The Residence had been defying the market. Buyers were showing keen interest in the site, and some significant sales had already been achieved.

Mr Phillips said the eastern end of the CBD was emerging as a keenly sought-after residential hub as the buildings had views of Sydney Harbour, the CBD and towards the Blue Mountains.

It is expected that as the credit markets improve, the fund will sell the Perth site, worth about $50 million, and plough the cash into other opportunistic assets.

- © Fairfax NZ News