South Australian Treasurer Tom Koutsantonis welcomed the announcement.
Billionaire Con Makris, whose wealth has been estimated at $1.03 billion in the latest BRW Rich 200 List, is joining the throng of developers setting up new luxury hotels in Adelaide.
Up to 500 new jobs are expected to be created when work begins on the long-neglected site formerly occupied by LeCornu in North Adelaide, following a deal signed by the developer.
The agreement was signed between Starwood Hotels and Resorts Worldwide and the Makris Group to begin work, with one of the hospitality sector’s most iconic names, the Sheraton, agreeing to run a 160-room hotel on the O’Connell Street site.
The $200 million luxury residential, retail and hotel development received planning approval in June, and the hotel construction is now expected to start either late next year or in early 2017 and open its doors in mid-2019.
South Australian Treasurer Tom Koutsantonis welcomed the announcement, saying public investment in Adelaide was helping leverage private investment in and around the city.
“We are well aware of the jobs and investment that the visitor economy brings to our state, which is why our recent state budget included an unprecedented $35 million over two years to promote SA to key international and domestic markets,” he said.
The hotel will offer leisure facilities including a state-of-the-art fitness centre and indoor swimming pool, with innovative work spaces and meeting rooms for business guests and a 300m2 ballroom.
The development will boast eight buildings, including the five-star hotel, a 16-storey apartment tower, public piazza, underground carpark, retail stores and restaurants.
Sheraton is owned by Starwood Hotels and Resorts Worldwide, while the Makris Group owns the O’Connell St land and hotel. Sheraton will run the hotel on behalf of Makris.
The development will bring to an end more than 25 years of inactivity on a prime slice of Adelaide real estate. It will be the first Sheraton hotel in South Australia.
The state is attracting more Asian and interstate tourists chasing premium food and wine experiences and has capitalised on the popularity of the new $535 million redevelopment of the Adelaide Oval, which attracts regular sellout crowds of more than 50,000 for Australian Football League matches and is within walking distance of the new Makris project.
The higher tourism numbers were a bright spot in a state economy being hit hard by the looming closure of the car manufacturing industry as Holden prepares to exit by 2017, and heavy job losses as energy company Alinta is preparing to shut down two power stations at Port Augusta in the state’s north, with the loss of 438 jobs.