Hillsong pays $23m for West Melbourne’s Festival Hall

The Wren family listed Festival Hall last year. The venue was built in 1955, after a fire destroyed the ex-West Melbourne Stadium developed by Sydney boxing promoter R L Baker in 1913.

Hillsong is paying $23.4 million for West Melbourne’s Festival Hall.

The Pentecostal church began negotiations in April after concluding as the under-bidder following an expressions of interest campaign last November.

The initial purchaser, a consortium of media groups, withdrew its bid in March fearing COVID-19 impacts on the entertainment industry.

Festival Hall is Melbourne’s eighth biggest venue by capacity and the largest to be privately held.

It is the first time the stadium has sold in 105 years.

Vendor, the Wren family, was represented by Colliers International’s Matt Stagg, Dave Walker and Daniel Wolman.

Two industrial investments surrounding Festival Hall, used for administration and storage, are now for public sale – each expected to trade for more than $3.5m.

Festival Hall will be part developed

Festival Hall at 300 Dudley Street is metropolitan Melbourne’s eight largest entertainment venue ranked by capacity – with the ability to carry 5400 in full mode.

As a seated-only venue it can accommodate 4500.

It was developed in 1955 by the Wren family, after a fire destroyed a facility constructed in 1913 by Sydney boxing promoter R L Baker.

On a 4135 square metre block, it was for years at first known as West Melbourne Stadium (story continues below).

In 2018, the Wren family proposed to replace Festival Hall with two apartment complexes. The stadium was later heritage protected but the airspace still has development upside.

Hillsong intends to occupy the complex as an anchor tenant while renting it out on vacant days for an income.

The church has also earmarked building a three storey wing as a kids ministry.

According to the three year old KPMG Stadium Ownership Report, the average construction cost for an Australian stadium seat is $10,000 ex-land.

Brisbane’s Fortitude Music Hall cost $12,285, factoring in the real estate, the marketing agents said.

Owner-occupiers strongly represented: agents

The Wren family retained Festival Hall as an investment.

The property was targeted to developers – the airspace having the potential to make way for at least two towers of over 20 floors.

The address is a city-gateway connecting Docklands to E-Gate, which is earmarked longer-term for major urban renewal.

It is walking distance to Southern Cross train station.

The state government, private schools, and hospitality, healthcare and retail groups – as well and those in the media sector – were also said to have been showing an interest during the 2019 expressions of interest campaign.

Festival Hall, also known as The House of Rock and Roll, has hosted The Beatles, Johnny Cash, Bill Haley, Frank Sinatra, Shirley Bassey, Red Hot Chilli Peppers, Foo Fighters, Ed Sheeran and Lorde.
Festival Hall set up as a television studio. It also accommodated events during the 1956 Olympics.
The stadium has 12 seating areas, a VIP zone and fan meet-and-greet space, 11 bars, four merchant stalls, 12 bathrooms, two dressing rooms, a communal lounge and offices. It is accessed from 46 doors along Dudley and Rosslyn streets and Wren Lane.

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Marc Pallisco

A former property analyst and print journalist, Marc is the publisher of realestatesource.com.au.