The state government has signed the deal with the GPT Group to buy two-thirds of its remaining city centre holdings for $20 million.
Government land and property developer Landcom and GPT have committed to work together on plans to redevelop four city blocks in the Hunter Street mall precinct into a mix of residential, commercial and speciality retail uses.
GPT would retain the other third of its properties.
GPT Group head of investment Mark Fookes said today GPT would support Landcom with its expertise in development and ability to attract third party capital but would not directly contribute any capital to future development of the site.
The deal comes about three years after GPT walked away from a $600 million retail-based redevelopment of the mall, blaming the former Labor government for not committing to removing heavy rail between Newcastle and Wickham.
‘‘Although the optimum urban renewal outcomes for Newcastle still rely on a state government decision on fundamental infrastructure changes within the Newcastle CBD, this partnership means that the footprint for a significant city urban renewal project remains intact,’’ GPT said.