With the sale of its David Jones Market Street property to Scentre an Cbus Property in the process of being finalised, David Jones’ parent company, South African retailer Woolworths Holdings Limited, intends to spend up to $200 million to redevelop its iconic Elizabeth Street store.

Woolworths Holdings Limited plans to create a 39,000sqm luxury department store spanning 11 levels in the heart of Sydney’s CBD retail precinct. The company added it plans to bring together, for the first time, a combination of contemporary gourmet food, dining and luxury fashion under one roof.

“The redevelopment of Elizabeth Street is an exciting milestone in the transformation of David Jones and will create a new benchmark in both Australian and global retail,” said Ian Moir, Woolworths Holdings chief executive.

“David Jones Elizabeth Street will have the best of contemporary store design while embracing the heritage of our iconic Sydney CBD building. We will fully utilise the building’s many remarkable spaces and restore world class food and dining as key element of the customer experience.”

As part of the redevelopment, the building’s level seven will become home to one of Sydney’s iconic restaurants and will be developed in partnership with Australian celebrity chef Neil Perry.

The David Jones Market Street property was purchased by Scentre Group and Cbus Property late last week for $360 million, which Scentre plans to develop into a luxury retail space and luxury residential tower. Scentre’s share of the purchase price is $182.5 million with Cbus Property paying the balance of $177.5 million.

David Jones will continue to lease the Market Street premises, which the company has occupied since 1938, until it completes the move to its Elizabeth Street flagship store.

The redevelopment of the David Jones Elizabeth Street store will be carried out in stages, starting from 2017 and is expected to be completed in the second half of 2019.

Access exclusive analysis, locked news and reports with Inside Retail Weekly. Subscribe today and get our premium print publication delivered to your door every week.