This article is from the Australian Property Journal archive
SC Capital Partners has secured Hub Australia for the former Victoria Police headquarters in St Kilda Road, in a first-of-its-kind deal that will see the co-working operator make its hospitality services available to all tenants in the building, while the owner says it has achieved record rental rates.
Hub’s hospitality services will open via amenity management of the level 11 business lounge, café and a range of serviced meeting spaces, in addition to two whole floors of flexible workspace totalling nearly 2,300 sqm.
Landlords are seeking a point of difference as the sector slowly emerged from an existential crisis faced during the pandemic. Artifex Property Director, Chris Piasente, acting on behalf of SC Capital Partners, said the unique agreement with Hub allows for an extensive and versatile amenity mix that has helped to attract other tenants to 412 St Kilda Road.
“Hub will significantly influence the management of the building’s associated amenity and flexible workspace, leveraging Hub’s operational and marketing expertise to ensure a positive financial outcome. Hub will then be rewarded with a performance-based management fee in return.”
SC Capital Partners says the redevelopment of the 18-level former police headquarters has set a new record for commercial rental rates in the St Kilda Road precinct, securing up to $580 per sqm and subsequently increasing its overall value to approximately $200 million.
“By partnering with progressive commercial operators like SC Capital and Artifex Property, we’re able to maximise a buildings’ return on investment, create premium and engaged workplace experiences, and help attract new tenants who see value in flexible workspace amenities,” Hub Australia chief property officer, John Preece said.
Asia Pacific real estate investment manager SC Capital Partners has leased 45% of the 412 St Kilda Road tower following a $40 million refurbishment. The former police complex had previously been slated for a Zaha Hadid-designed apartment project before it was picked up vacant by the Singapore-based group for just over $107 million late in 2019.
Former owner, Malaysian group UEM Sunrise had offered the tower to the market after abandoning plans for the 152-unit Mayfair project, which had suffered slow sales in the softening apartments market. The sale echoed Woodlink opting to sell off nearby Illoura House at 424-426 St Kilda Road, which had approval for an 18 level-mixed use building with 163 apartments and 176 hotel rooms. It sold for over $70 million to the Asia-based Mars family buyer that will use the property as an office play.
At 412 St Kilda Road, Australian commercial building company, Hansen Yuncken signed a 10-year lease agreement over 760 sqm in the building. Also committing to space are retirement village operator, Summerset Management Group (566 sqm for four and a half years), online food-ordering software provider, Fresho (337 sqm for three years); property developer, Pallas Group (378.3 sqm for one year); and e-conveyancing firm, Lodgex (187.9 sqm for two years).
OurMoneyMarket and BSI will start moving in from this month into 308.4 sqm and 268.4 sqm respectively.
The building is close to the future Anzac railway station, part of the Melbourne Metro tunnel project, and offers view lines to the Shrine of Remembrance, surrounding parkland and Royal Botanic Gardens, Melbourne Grammar School, the Dandenong Ranges, Albert Park Lake and Port Phillip Bay.
Gray Puksand is transforming the circa 1984 interiors and has completed the fit-out of five floors, each with a different palette to assist tenants who may not have the resources or inspiration to design their own fit-outs, with high ceilings and terrazzo among the stand-out features, Matt Cosgrave, associate director of office leasing, Colliers International said.
412 St Kilda Road has triple frontage to Queens Lane, Bowen Crescent and St Kilda Road. It has a total net lettable area of 16,220 square metres and flexible standard floor plates of approximately 1,136.5 sqm.
A café operator will open in October on the 350 sqm ground floor retail space. Artifex Property is also in talks with a wellness operator to occupy a dedicated 400 sqm space on level one.
Facilities include storage space for 139 bikes, 13 showers, 312 lockers and 169 car parks across six levels.
Levels 14 to 17 remain available for lease, along with limited space on levels four to nine and 13. Colliers and Cushman & Wakefield are managing the leasing campaign.
Hub Australia recently committed to a new 3,000 sqm offering in Richmond in a 12-year lease at Salta Properties and Abacus Property Group’s commercial and mixed use development at 459-471 Church Street, soon after striking an alliance with local co-working group WOTSO that will see their respective central and suburban-focused offerings open to the rivals’ combined 7,000 members.
