Murdoch junior outbids Sydney A-listers on £12.7m house

Former French consulate with ocean views sets new price record for the city

Russell Crowe and Nicole Kidman were among the 10 registered bidders at Australia's most exclusive auction this week, when Sydney's poshest residence went under the hammer. But Hollywood lost out to Fleet Street when Lachlan Murdoch, eldest son of Rupert Murdoch, snapped up the 4000-sq m neo-Georgian property for A$23m (£12.7m).

Le Manoir is the former French consulate in the city, and has six bedrooms, five bathrooms, two studies, servant quarters, a guest powder-room, a tennis court, swimming pool, three-car garage and commercial-size kitchen.

The price set a new record for Sydney house prices this year, and the other prospective buyers, including Crowe and Kidman, who sold her house this year for A$12m, were not prepared to match it. Neither of the film stars was present, but Mr Murdoch, 38, was at the private auction. Crowe and his wife, Danielle Spencer, had attended the appointment-only inspections, and the star of Gladiator, Master and Commander and Cinderella Man reportedly monitored the auction via the internet.

The French government had insisted on a refundable pre-auction A$50,000 deposit as evidence of serious intent on the part of bidders, and reserved the right to vet them. France had owned Le Manoir, in Bellevue Hill, since 1956, when it bought the property for A£26,000. (The dollar did not replace the pound until 10 years later.) Le Manoir, built in 1926, is shielded by 9ft fences and a steel electric gate, with the house at the end of a long driveway.

Mr Murdoch, once seen as the heir to his father Rupert's media empire, abruptly quit executive roles with News Corporation four years ago, although he kept his seat on the board. He returned to Australia, set up a private investment company, and his family moved into a waterfront home in the beach suburb of Bronte. Insiders say he and his wife had been inspecting "family-friendly" houses around the city for a year. They have two boys, Kalan, aged four, and Aidan, three.

Le Manoir, which has panoramic views from Sydney Harbour to the Pacific, was expected to fetch at least A$15m. But bidding for the house, which occupies a sprawling one-acre block, opened at A$18m, and 10 minutes later, Mr Murdoch made the winning bid.

The estate agent Michael Pallier told Bloomberg news agency: "There weren't any signs of a global financial crisis at the auction last night, with 10 registered bidders going hammer and tongs. It was one of a handful of Sydney's eastern suburbs trophy homes, and they rarely become available."

Mr Murdoch's friend and former colleague James Packer, the gaming billionaire, set the previous house price record for the year, when he and his wife, Erica, paid A$18m for an opulent property in Vaucluse, one of Sydney's most expensive waterfront suburbs. The home Kidman sold is in Darling Point, also in the eastern suburbs.

Rupert Murdoch will be able to inspect his son's latest acquisition personally: he is in Australia this week to meet executives, analysts and shareholders, as well as see his mother, Dame Elizabeth, who was 100 this year.