The Sydney Morning Herald from Sydney, New South Wales, Australia on May 5, 1991 · Page 16
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The Sydney Morning Herald from Sydney, New South Wales, Australia · Page 16

Sydney, New South Wales, Australia
Issue Date:
Sunday, May 5, 1991
Page 16
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flMll ROAMS 0 uv Property bust loom for soells g Mgh-flying -By SALLY FITZGERALD E Suburbs vet HE once said there were only 75 waterfront properties in Sydney which matter all of them absolute eastern suburbs waterfronts with north-west aspects. Dr Stephen Larkin, now SI, a former Sydney University boxing champion and a graduate in the school of veterinary science, is one of the unsung casualties of Australia's 1980s property boom. He operated a series of multi-million dollar private companies during the 1980s, buying and selling some of Sydney's most exclusive real estate. In 1987, he forged a business alliance' with high-flying Sydney stockbroker Brent Potts, of Potts West Trumbull. When Larkin wasn't bidding at an auction in the eastern suburbs he was nutting out development applications to rebuild Kings Cross. Companies like Rovula Pty Ltd, Desedo Pty Ltd, Devuna Pty Ltd, Varimu Pty Ltd and Rofalo Pty Ltd appeared time and again on title deeds in those heady days. But Larkin remains a mystery. His two major remaining assets, the high-profile Oz Rock Cafe and the Crest Hotel both within a stone's throw of the huge Coca-Cola sign at the top of Kings Cross are in the hands of receivers. The receivers, Arthur Andersen, told The Sun-Herald they had not been able to contact Larkin since the initial consultations following their appointment to the Oz Rock Cafe at the request of the State Bank of NSW two months ago. No-one answers the telephone at two home numbers, one in the Blue Mountains and one in Vaucluse. A call to the Larkin Group head office in Kings Cross revealed that a new business had moved into the premises and no forwarding number had been provided. Larkin's business partner. Brent Potts, recently wound up his stock-broking firm after a spectacular car crash last year left him all but incapacitated. BUT in the 1980s, things were different. The kings of property came to Kings Cross with a vision for its future as a tourist mecca. The Kings Cross facelift was valued at $1 billion including Sid Londish's ill-fated La Galleria (a S29S million development proposal), the Potts Point Plaza building and the Top Of The Cross building (which Larkin had sold to the Adelaide developer, Fricker Corporation, for $4.4 million in April 1988). By this time, Larkin had a veritable swag of assets. In 1986, he paid $3.2 million for the Kings Cross Hotel at the Potts Point end of Darlinghurst Road. The property had been gutted by fire and $3 million was spent on 1 i 5- - J Hi ' HARD HIT: Former Bondi Junction vet Dr Stephen Larkin, whose property ventures, based mainly in the Darlinghurst-Kings Cross area, turned sour. INSET: Brent Potts. renovation before Larkin bought it (He sold it in June 1990 for $4.5 million, as well as the building next door for S2.4 million.) He had been edging his way up to Kings Cross from Darlinghurst, where he had bought, renovated and then sold the Burdekin Hotel in Oxford Street for more than $1.2 million and was still deciding whether to accept a $1.6 million offer on the Exchange Hotel, also in Oxford Street. The former veterinary surgeon he had practised in Bondi Junction until about 1980 and was now a respected collector of Australian art as well was riding the property boom in style. In 1987, he paid Brent Potts about S3.S million for a Vaucluse waterfront home. Potts had bought the fire-damaged property from Larkin only seven months previously for $2.4 million. When Larkin rebought the site, he knocked down the house to build a tennis court and gazebo. The house was next door to Larkin's four-bedroom home. Ten days ago Larkin sold this home, dubbed St Neot's, and the block next door, for more than S8 million but the selling agent, Laing & Simmons of Double Bay, refused to disclose the exact price. The whole property was valued in 1988 at $15 million, with features including a gymnasium, pool, boath-ouse and jetty. ALSO in 1987, Larkin bought the site that was to become the Oz L Rock Cafe at the top of Kings Cross. He had also just received approval to develop a tourist resort on 800 hectares of land in Kurrajong Heights in the Blue Mountains, on which he planned to spend $60 million his biggest project to date. But that plan hit a snag when local US ji- . . WATERFRONT MANSION: St Neot's, the luxury former home of Dr Stephen Larkia, was auctioned last month, along with an adjoining property, for an estimated $8 million. FAILED VENTURE: The Oz Rock Cafe at Kings Cross, once the mecca of Sydney's music-loving younger brigade, is now in the hands of the receivers. residents protested about development of one part of the site for a rural residential subdivision. He finally received approval in 1989. But within 12 months Larkin was desperately seeking a joint equity partner for the project. Surrounded on three sides by National Park, the site was to include a golf course, an equestrian centre and a 200-room five-star hotel. In July 1988 Larkin and Potts agreed to pay $42 million for the Crest Hotel, a 232-room property, and were planning S6 million worth of renovations on the promise of funds from the Bank of New Zealand which never eventuated. Down the street, the Oz Rock Cafe had became a venue for young Australian pop musicians, catering for under-18s in the unlicensed upstairs bar. Streams of teenagers could be seen queueing down William Street for entry to the club. It was reaping $22,000 a week in profits in those heady days generating in excess of $1 million profit a year in 1988 and 1989. (By June, 1990, however, expenses had blown out to almost $2 million a year. Interest charges were mounting and, by last December, it was costing Larkin just under SI million to service loans associated with the Oz Rock Cafe.) FDR property entrepreneurs in 1988. it seemed like the sky was the limit. In December that year, Larkin agreed to buy the Olivetti office building in William Street for $18 million. He wanted to build a five-star hotel. He also bought the heritage-listed Glenmore Golf and Country Club in the Mulgoa Valley, near the proposed site of the Badgerys Creek International Airport, from another Sydney property developer. Warren Anderson. By December, the Golf Club was on the market, but Larkin turned down a $7.7 million offer at auction. On the same day, he was seen bidding at a Darling Point residential auction. That property was passed in at $4.5 million. He had been unsuccessful on the purchase of another waterfront prop erty at Point Piper with a bid of $11.9 million just two months before. In the five years to 1988, he bought and sold six waterfront properties in the eastern suburbs. He also found time to accumulate an impressive collection of Australian an through his dealer, Trevor Bussed. He favoured works by Tom Roberts, Janet Cumbrae-Smith and William Dobell. He was fond of striking while the iron was hot and. in March 1989, he and Brent Potts struck two deals that were never to come to fruition. A month earlier. Larkin bought Abe Saffron's Kings Cross property in Orwell Street, site of the historic Roosevelt nightclub which Saffron ran during the early 1950s. Larkin' bought the property from Actors Equity of Australia for between SI. 3 and SI. 7 million and planned to restore it to its former nightclub glory. In March, he and Potts agreed to buy 12 commercial strata units in ACOA House in Castlereagh Street. Sydney for S8.8 million and the adjoining Tudor Inn Hotel for S4.6 million. The pair put both properties back on the market before settlement, hoping to snatch a higher price. But none came. By August 1989 the PottsLarkin company was in voluntary liquidation, effectively releasing them from the two sale contracts and enabling them to retrieve deposits. A year-long court case with the Bank of New Zealand was finally-thrown out of court earlier this year, resulting in the Bank declaring the company insolvent and appointing a receiver. The State Bank immediately responded by placing the Oz Rock Cafe in receivership. But Larkin remains an enigma. Despite his alliance with one of Sydney's most influential stockbrokers, Larkin avoided the public stock exchange. His network of private companies has ensured no single accountant or banker knows the entirety of his business assets. And only he. perhaps, knows what dreams are made of. THE SUN-HLRALD. May 5. 1991 17

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