Why Merivale boss Justin Hemmes took on a $215 million battle with the government
Billionaire pub baron Justin Hemmes is embroiled in a multi-million dollar dispute with Sydney Metro over property later purchased to build a new metro station.
Hemmes Hermitage Pty Ltd, the Merivale boss’ family business, claims the land in George Street, in the heart of Sydney’s CBD, is worth $215 million.
However, lawyers for the transportation agency presented documents to the court earlier this year to argue that the market value of the land is only worth less than half that amount ($91 million).
The dispute arose after Sydney Metro acquired two properties opposite Wynyard Station in 2022, which Hemmes Hermitage bought for $77 million in 2018.
The properties were compulsorily acquired as part of the ongoing construction of the Hunter Street station, which will form part of the new $25 billion Metro West line.
Hemmes Hermitage said at the time that the adjacent properties at 312 and 314-318 George Street would become part of a redevelopment of the Ivy district, the Sydney Morning Herald reported.
The company’s legal representatives took legal action in the Land and Environment Court in June last year to challenge the valuation of the land.
Hemmes Hermitage’s legal team argued the land was worth double the amount Sydney Metro was willing to pay.
Billionaire pub baron Justin Hemmes (pictured right) is embroiled in a multi-million dollar dispute with Sydney Metro after the transport company acquired two properties in Sydney’s CBD
The company also argued that the properties were critical to creating a multi-functional commercial, hotel and hospitality location as part of the sprawling Ivy precinct.
Sydney Metro previously rejected the NSW Valuer General’s $102 million bid for the land.
Lawyers for the transport agency said the “various theoretical development plans” had not made significant progress when they acquired the land.
The lawyers also argued that a laneway owned by the City of Sydney Council would have stopped proposed development of the properties.
The state government is obliged to pay legal fees in connection with the compulsory acquisition of land, if the amount is reasonable.
Sydney Metro claimed legal costs incurred by Hemmes Hermitage up to June this year, amounting to $498,000, are unreasonable.
The latest legal battle comes after the company filed a separate lawsuit in September seeking $19 million from Sydney Metro to acquire the land.
Hemmes Hermitage Pty Ltd claims the plot of land on which the two properties are located is worth $215 million (pictured the land acquired by Sydney Metro and the Ivy Precinct)
Hemmes Hermitage said at the time that the properties would become part of a redevelopment of the Ivy precinct, a popular restaurant and entertainment district in Sydney (photo The Ivy)
The company claimed it had lost several access rights, causing the Ivy Precinct’s value to drop an estimated $525 million to $506 million.
Mr Hemmes is also part of a group of companies fighting for the rights to build two skyscrapers 51 and 58 floors above the metro station.
A spokesperson for the Hemmes Hermitage told the Sydney Morning Herald that they had “nothing to say” about the ongoing court case, other than to say that it is “proceeding in the usual course of such matters.”
A spokesperson for Sydney Metro said “owners who disagree with the Valuer General’s determination may appeal to the Land and Environment Court.”
Daily Mail Australia has contacted Sydney Metro for further comment.
