How Sydney’s lockout laws created profits for property investors
Sydney’s lockout laws might have decimated the business of music venues in the zones, with one club revealing its foot traffic fell by 40%.
But property investors in the areas have made a killing at a similar rate in hotspots like Kings Cross and Potts Point.
Investors in a row of Potts Point terraces made a 40% profit in 18 months after selling them to Sydney developer Greencliff for $18 million, reported Fairfax Media.
Two of the Eagle Property Group’s Bayswater Road assets included The World Bar and Candy’s Apartment nightclub.
In May 2016, operators of The World Bar announced that revenues were down 25% in the first two years of the lockouts, and that it was forced to slash the number of bands it booked on Friday nights from six to two.
In addition, the laws’ requirement for ID scanners, RSA marshals, CCTV upgrades and a rise in public liability insurance due to being in what was deemed a “high risk” area cost it a total of $229,400.
But earlier this year, The World Bar was one of the first venues after the Callinan Review to have the rules relaxed.
It was allowed to serve last drinks at 3.30am instead of 3am, and allow new patrons in until 2am instead of 1.30am.
“Cleaning up” the entertainment precincts has been a boon for property developers. Greencliff Executive Chairman Dr Stanley Quek told Domain’s Commercial Real Estatethat such areas were ready for regeneration.
“Bayswater Road is well and truly in the midst of transformation,” he said.
“It will become one of the city’s most aspirational destinations to live, offering a sophisticated, exclusive inner-city lifestyle.”
The trend became obvious 12 months after the introduction of the lockouts.
Apartment prices in Kings Cross were up 25%, according to figures compiled by the Domain Group.
In comparison, prices for similar apartments outside the zones either declined or stayed stagnant.
Local estate agents said that young professionals working in the city, same-sex couples and savvy investors had by then started moving into the area after the so-called riff-raff were sent packing.