How Merivale’s powerful political ties helped move a light rail stop

Merivale successfully lobbied the NSW Liberal government to move the Wynyard light rail stop outside its billion-dollar Ivy precinct as the hospitality giant’s chief executive, Justin Hemmes, cultivated his contacts at the top of the Liberal Party.

New documents released under freedom of information laws show that while restaurant owners across central Sydney were pushed to the edge of financial ruin by the construction of the $3 billion light rail, the office of then transport minister Andrew Constance intervened on Merivale’s behalf by raising its concerns about the location of the light rail stop, height of the platform and taxi access with Transport for NSW officials.

“I understand Merivale have raised the following: Requested the stop be moved from outside Wynyard to Ivy,” a transport liaison officer working in Constance’s office wrote to the department in January 2016.

“Can I please request a brief on the issues raised by Merivale (to date) and the impacts of the CBD and South East Light Rail on its venues (Ivy & Establishment)?”

The light rail stop was built in 2019 outside the Ivy, the mega nightclub and restaurant complex owned by Hemmes.

A stop outside Wynyard station would have provided commuters direct access to the light rail from one of Sydney’s busiest train stations and to the $640 million Hunter Street Metro station under construction across the road.

Instead, commuters now have to walk 150 metres down the road to board the light rail outside the Ivy.

The Ivy precinct is at the centre of allegations revealed in July by this masthead and 60 Minutes that the company exploited women, facilitated drug use, ignored sexual harassment, and underpaid staff, while serving VIPs with political and criminal links, including men who would go on to become some of Australia’s largest drug suppliers and tax fraudsters.

Merivale has denied the allegations and accused this masthead of malicious journalism. “Merivale is and has always constantly strived to improve its workplaces and services,” Merivale’s lawyers said in July. Fair Work has launched an investigation into the company.

One Transport NSW proposal contained in the documents shows the centre of the light rail stop covering Palings Lane, which divides Merivale’s CBD headquarters. But the proposed stop would have blocked access to Merivale’s Ivy restaurant precinct, which houses restaurants Uccello and Felix as well as its VIP club Level 6.

Instead, the light rail stop was constructed further away from Wynyard and closer to Angel Place, allowing Merivale to expand its al fresco dining outside its restaurant Totti’s. Merivale was also able to secure a “super taxi rank” on Pitt Street to ferry customers away from the Ivy. The company did not respond to requests for comment about its lobbying of Transport for NSW.

A spokesperson for Transport for NSW said a wide range of factors were considered during the planning of the major new public transport project, which had an extensive and lengthy design process, involving public consultation and stakeholder feedback.

“Transport considered a variety of locations for the Wynyard Light Rail stop and its design went through a number of iterations throughout the planning process,” the spokesperson said.

“Factors taken into consideration included pedestrian safety, crowding, traffic, road interfaces, platform size, positioning in relation to train stations and other key infrastructure, drainage, accessibility and distance to locations and services.”

The construction of the light rail was dogged by repeated delays, legal battles and prolonged disruption, leaving smaller businesses struggling to survive with debts of up to $500,000.

Emanuel Tzirtzilakis, the owner of a cafe on Devonshire Street in Surry Hills, told a NSW Parliamentary inquiry in 2018 that he had been driven to the “brink of financial ruin” by the project.

Constance led a $31 million compensation scheme for some businesses, but others have taken their claims to the High Court after the NSW government won an appeal against further compensation in 2023.

The former transport minister told this masthead after the story was first published online that he “did not know Justin Hemmes in 2016”.

“I never had anything to do with the light rail stop location,” he said.

Constance became closer to Hemmes as the hospitality baron expanded his empire into Narooma in Constance’s electorate of Bega. Hemmes bought the Glasshouse Rocks estate in 2017 and now owns four venues and several expansive waterfront properties.

The former transport minister was regularly seen at events at the Ivy, including parties hosted by Liberal lobbyist and Hemmes’ political consigliere Michael Photios, who ensured the 52-year-old’s relationships reached the top of the Liberal Party.

In January 2022, two days after New Year’s Eve, NSW Premier Dominic Perrottet scheduled a meeting with Hemmes at Constance’s home, a separate set of documents released under freedom of information laws reveals.

“7:30pm Private Drink-Dinner: Premier/Andrew Constance/Justin Hemmes,” the calendar invite from Perrottet shows. “Where: Andrew Constance Property”.

When the trio met up, it was not at Constance’s south coast home but Hemmes’ 60-hectare mansion in Narooma.

The scheduled meeting was never disclosed in the premier’s ministerial diary entries. The rules governing ministerial diary entries do not require ministers to disclose social events but cautions them to make public any “substantive discussion of issues” that may be considered by the minister.

The documents show Hemmes would personally email Perrottet’s office to request meetings, including one to discuss Merivale’s unsolicited proposal for the commercial development of Hunter Street metro station, which went ahead on 14 December 2021 and was disclosed in ministerial diary entries.

But another titled “6pm catch up. Justin Hemmes” on September 15, 2022 at his restaurant Felix, was not disclosed. The former premier declined to comment.

In his previous role as state treasurer, Perrottet became a key supporter of ending the lockout laws that had dented Hemmes’ hospitality empire and put restrictions on the wider industry. Perrottet appointed the billionaire to his Treasury advisory council in 2018. As premier, Perrottet described him as a “pub doyen” in 2021 and lauded him for his plans to revitalise the CBD.

During the COVID-19 pandemic, Perrottet and Hemmes unsuccessfully lobbied then federal treasurer Josh Frydenberg, one of Hemmes’ close friends, for an extension of JobKeeper and pushed for a repeal of the fringe benefits tax to encourage corporate long lunches.

After Constance resigned as transport minister and triggered a by-election in Bega in 2022, a briefing from Perrottet’s office spruiked Hemmes’ establishments in Narooma during a campaign stop to highlight a $4 million upgrade to Narooma wharf, which helps service Merivale venues and other restaurants in the southern inlet.

When Perrottet resigned as premier in 2023, he had a three-hour lunch at Hemmes’ restaurant Felix.

A year later, when he left state parliament, the Ivy and the penthouse that is home to the infamous private members club, Level 6, hosted Perrottet’s farewell. Merivale paid for the former premier’s send-off. The gift did not need to be disclosed because Perrottet left parliament that day.

Ministerial diaries show the former state Liberal government had 20 meetings with Merivale between 2019 and 2023, involving the premier, police minister, transport minister, and treasurer. NSW Labor Premier Chris Minns has had two meetings with Merivale since being elected in 2023.

Hemmes and his companies have donated more than $350,000 to the Liberal Party since 2018, Australian Electoral Commission records show, while hosting fundraisers with prime ministers at his mansion, the Hermitage, now estimated to be worth $200 million, as part of his decade-long campaign for greater political influence.

Internal messages show the company has also targeted men with political capital, including former chiefs of staff in the state government, for special treatment by offering them complimentary Level 6 memberships.

In 2021, Merivale secured one of the biggest government catering contracts in the state: a six-year multimillion-dollar deal under a competitive tender by the Liberal government run by Venues NSW to provide food and drinks at two of Sydney’s largest stadiums, the SCG and Allianz.

The state Labor government has put the company on notice, signalling that any plans to renew the contract are under threat following the allegations of exploitation, harassment and underpayment revealed by this masthead.

“We should make sure that we do everything we can to keep workers safe, particularly young women workers who are vulnerable to exploitation in these circumstances,” NSW Legislative Council member Dr Sarah Kaine, the government’s procurement inquiry chair, said in July.

The company is also in a $124 million dispute with the state government over the compulsory acquisition of two properties it bought opposite Wynyard Station for $77 million in 2018, which it had planned to turn into “Ivy 2.0” as part of its $3 billion property empire.

Hemmes’ company, Hemmes Hermitage, has launched legal action in the Land and Environment Court, arguing it was worth double what the transport agency was willing to pay.

That may end up being small change compared to Merivale’s ultimate goal: becoming one of Australia’s biggest property developers. Hemmes remains in the running to build two skyscrapers above the Hunter Street station entrances, in a project worth more than $6 billion.

The skyscrapers will tower over the Ivy precinct and the Wynyard light rail stop below.