This article is from the Australian Property Journal archive
DEXUS property Group has secured outdoor apparel retailer Kathmandu to a new facility at Laverton North in Melbourne's west.
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Kathmandu has leased 25,650 sqm at a new development at Dexus Industrial Estate Laverton North, with construction commencing in mid-2015 and completion expected in mid-2016.
The Kathmandu transaction was the most significant deal signed in the March quarter, which saw a total of 40,743 sqm of industrial space leased across 12 transactions. Other transactions include Yusen Logistics for 4,925 sqm at 1 Foundation Place, Greystanes and the Government Property NSW across 4,356 sqm at 145-151 Arthur St, Flemington.
The deals help lift Dexus` industrial portfolio occupancy rate by income from 92.8% in the December quarter to 93%. Although occupancy by area remains at 92.1% and WALE by income declined from 4 years to 3.8 years.
At the same time, Dexus reported an increase in average incentives, from 9.6% in December to 12.4%.
In the office portfolio, Dexus leased 58,288 sqm of space 87 transactions, which included securing a renewal with Commonwealth Bank of Australia across 21,964 sqm at 150 George St Parramatta.
Dexus office and industrial executive general manager Kevin George said continued positive leasing momentum for space in core A-grade properties in Sydney and Melbourne has driven leasing volumes across the portfolio.
“In these markets we have seen solid demand from new smaller space users for our fitted suites as well as customers requiring space across multiple floors.
“Pleasingly, net absorption for east coast CBD office space reached a four-year high in the 2015 March quarter with Sydney, Melbourne and Brisbane recording an increase in occupied stock,”
Other transaction include securing renewals with five tenants across 3,385 sqm at 44 Market St Sydney; renewing the NSW government (Minister for Police) across 2,177 sqm at 201 Elizabeth St Sydney and securing two new tenants across 4,444 sqm after the departure of Lloyds at 45 Clarence St Sydney.
Despite the transactions, occupancy across the office portfolio decreased marginally to 94.6% from 95% primarily due to NSW government vacating 4,438 sqm at 130 George St Parramatta.
Dexus CEO Darren Steinberg said it is pleasing to report solid leasing outcomes achieved across the portfolio combined with the strong performance.
“We are well positioned to continue to leverage improving market conditions in Sydney and Melbourne, and drive performance for our investors and third party funds and capital partners,” he added.
Including the impact of the equity raising, Dexus reaffirmed its FY15 guidance of FFO per security of 59.48 cents and distribution per security of 41.04 cents, representing 9.3% growth on FY14.
Australian Property Journal