The Australian Unity Healthcare Property Trust applied on April 22 to demolish buildings around the 141-year-old Newmarket Hotel, which currently lies vacant on the corner of North and West Terrace. Planning consent is already in place for a 32-storey building on the site.

The Trust, which invests in private hospitals, medical centres, laboratories and aged care facilities, is envisaging “health-related uses” for the new tower, although specifics are yet to be determined.

The Newmarket Hotel, which has been closed since 2017, will be retained as part of the new development and potentially reopened as a gastropub, the Trust said.

Assistant fund manager Nicole Plant said the final form of the tower would be determined by “what the market needs”.

“There’s still a fair bit to go before we can really sort of come out with a firm idea as to when active redevelopment would happen on the main site,” Plant said.

“We’ve just got approval to demolish the buildings around the Newmarket Hotel, so we’re just running a process on that at the moment and hope to be in a position to proceed with those works later this year.”

The Trust purchased the Newmarket Hotel site in 2023 for a reported $38.5 million.

The site was previously owned by developers One North Terrace Pty Ltd, which was granted planning consent in July 2021 to build two 32-storey towers behind the state heritage listed hotel.

The earlier proposal included 352 apartments, five floors of office space and six ground floor retail tenancies within two buildings standing 107-metres tall.

Plans for two 32-storey towers behind the Newmarket Hotel which never came to fruition. Image: Cox Architecture

But Plant said the location was well-suited for health and medical services given its proximity to the Royal Adelaide Hospital (RAH), universities and Adelaide’s biomedical precinct.

“It’s not often in Australia that you get such a prime site opposite a major public hospital,” she said.

“Given its location on that corner opposite the RAH, we see that it’s a pretty good opportunity for an alternative use that might be better suited for the BioMed City up that end of town.”

There have been plans to redevelop the Newmarket Hotel site dating back to 2015.

The previous owners won planning consent in 2016 to build two 24-storey towers holding 401 apartments, but the $200 million plan was later quashed in a Supreme Court challenge by adjacent landowners.

The state government also investigated the land parcel as an option for the new Women’s and Children’s Hospital build, but determined the site presented too many issues for ambulance access given its location on two major arterial roads.

The government later settled on the Thebarton barracks for its $3.2 billion hospital project.

The Newmarket Hotel will require restoration as part of the development.

The building, adjacent to the former HQ Complex nightclub, has been damaged during years of disuse, including significant damage to a famous cedar circular staircase.

Plant said the Newmarket Hotel would not be incorporated into the healthcare part of the development.

“There’ll be no demolition of it. It’ll probably be repurposed for some sort of gastropub or something similar,” she said.

“There’s obviously issues in the hotel in terms of that internal staircase that need to be reinstated.”

The Australian Unity Healthcare Property Trust holds nearly $4 billion of healthcare assets nationwide.

It currently owns 11 aged care facilities in South Australia after completing a $220 million purchase of nine centres across Adelaide in 2022.

The Trust also owns the financially distressed Western Hospital in Henley Beach.