Clubs unleash hidden riches

The redevelopments are being undertaken either to upgrade facilities to entice more members or through the sale and leaseback of sites.

The Redfern RSL is the latest Sydney club to seek to capitalise on the underlying value of its real estate.

An associate director of CB Richard Ellis, Nathan Egan, said the club was following in the footsteps of the nearby Souths Leagues Club, which was being refurbished by the property developer Trivest and the South Sydney Rabbitohs.

The $35 million Souths project involves a new club headquarters and 10,000 square metres of commercial space.

South Sydney Rabbitohs and Trivest have formed a joint venture, High Concept, to purchase and redevelop South Sydney Leagues Club at 265 Chalmers Street, Redfern, in a $35 million deal.

The joint venture will see the construction of a purpose-built club with a $3 million fit-out, the construction of a new club headquarters, and 10,000 square metres of commercial space to be leased.

The South Sydney deal came after Penrith Panthers was redeveloped in a deal estimated to be worth $300 million.

Another project being debated by Leichhardt Council is the proposed redevelopment of Balmain Tigers Leagues Club in Victoria Road, Rozelle.

David Milton, the residential projects managing director for CB Richard Ellis, said other clubs had sought to unlock capital tied up in their real estate by teaming with residential developers. Redfern has appointed CB Richard Ellis to seek expressions of interest in redeveloping its prime inner city site to incorporate new club premises.

Another recent example was the redevelopment of the Kirribilli Club site at Lavender Bay by the diversified property group Thakral Holdings.

The club acquired new premises in Alchemy, a Thakral development that incorporates 20 waterfront apartments. Mr Milton said all but two of the Alchemy apartments had been sold at prices starting at $3.37 million.

Other club development deals in recent years included Villa World's redevelopment of the North Sydney Club site as the Harbour Watch apartments. St Hilliers undertook a similar project in Coogee, redeveloping the old Randwick Rugby Club to incorporate new club premises with Coast apartments.

"We're expecting to see more of these types of transactions in the future as clubs place an increased emphasis on the value of their real estate," Mr Milton said.

"Many of these clubs are long established and are in prime locations where land supply is limited. By striking these types of agreements, the clubs can update their facilities for members while developers can access sites not readily available in the current market."

The Redfern RSL is on a prime 1638 square metre site at 157 Redfern Street, directly opposite Redfern station.

Redfern RSL's general manager, Peter Butcher, said the club wanted to provide existing members with new premises while at the same time recruiting more members.

"By providing a modern club environment we believe we can better appeal to the demographic of the surrounding area and attract more members in their mid-20s to mid-30s," Mr Butcher said.

Mr Egan said the RSL property in Redfern comprised an older style, two-level club building and associated car parking.

However, Mr Egan said there was significant potential to develop the site, in the heart of Redfern. The site's zoning allows for a height limit of 18 storeys.

"[Redfern] is already being targeted for major projects such the $123 million media hub being developed at the Australian Technology Park, which is already home to Pacific Magazines and Channel 7," Mr Egan said.

"This is expected to bring up to 2000 permanent jobs and boost business in the area, indicating a growing confidence in Redfern's future."

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