Developer Steller will retain a controversial St Kilda block it listed for sale last month.
The site of the former Greyhound Hotel at 1 Brighton Road was expected to sell for more than $8 million.
Steller, directed by Nicholas Smedley, paid $7.5 million for the 911 square metre parcel last October.
Just prior to the 2017 campaign, a 164-year old hotel on the block, at the south-west corner of Blessington Street, near the St Kilda Botanic Gardens, was demolished to make way for a residential redevelopment.
A permit for an eight-storey building containing 37 apartments (artist’s impression, top) was offered during both recent sale campaigns.
“After assessing the current market conditions and witnessing strong demand for our most recent project launches, we have decided to retain the site at 1 Brighton Road and will look to launch the project as a mixed-use development in 2019,” Steller project sales and marketing director, James Cirelli, said.
“Originally purchased with the view of being Steller’s first built to rent model, an EOI campaign resulted in strong local owner occupier demand, which confirmed the location and product is best suited for a 2019 retail launch and Steller’s first built to rent model to be in the upcoming site located at Chesterville Rd, Cheltenham.”
The Greyhound Hotel was renowned as one of Melbourne’s best-known drag venues and gay bars and as “part of the fabric of St Kilda” before closing in late 2016.
One of the owners of the venue at the time, Will van der Linden, 75, said in a Leader newspaper article that he fought an “uphill battle” to retain it – facing objections by the City of Port Phillip council when he attempted to extend trading hours, then increase the capacity of people it could hold.
Early last year, and after a demolition permit was obtained, this council then failed in an attempt to have the building heritage listed via planning minister Richard Wynne – a move which would have prevented the apartment development in its current form.
Last week it was reported Steller paid about $11 million for Healthscope’s former Parkdale hospital, about 23 kilometres south-east of the Melbourne CBD – part of a move by the builder to enter the independent living units and aged care retirement sector.
This 4765 sqm site, 153 Como Parade West, is now mooted to make way for a 120-bed high-care aged care facility.
Last September, Steller paid $23.4 million for a low-rise office at 200 Wells Street, South Melbourne, permit-ready for a 20-level, 174-unit apartment complex.
In November it also teamed with Julian Gerner, the owner of heritage listed Sorrento’s Continental Hotel, to refurbish the building and replace a vacant land component with a hotel, gym, day spa, 25 metre lap pool, spa, sauna, steam rooms and apartments.
Two months ago, Steller paid $4.3 million for a childcare development site covering 1A Laura Street and 1036 Glen Huntly Road, in Caulfield South, following an off-market campaign.
Steller reportedly has more than 20 projects on the go in metropolitan Melbourne.
Mr Smedley, a former merchant banker with the United Bank of Switzerland, is the son of Australian businessman Peter who at one time was the chairman of Arrium (formerly known as OneSteel).
Peter Smedley also held executive positions with Shell Australia, Mayne Nickless and Colonial Group Limited, the latter for which he is reportedly paid an annual life pension of $837,333, following its takeover by Commonwealth Bank.