This article is from the Australian Property Journal archive
CHARTER Hall has leased over 3,330 sqm of office space within Brisbane’s Santos Place office tower, securing a commitment from the federal government while the anchor tenant ups its presence.
The Department of Health has secured 1,110 sqm of space in the 32 Turbot Street tower on a five-year term, following the consummation of an earlier, 1,700 sqm lease to the Australian Competition & Consumer Commission, which relocated to the building under a 10-year lease agreement.
Anchor tenant Santos has put its foot on a further 2,220 sqm of space after striking a seven-year lease commitment.
CBRE and Knight Frank managed the leasing campaign.
Gerry Leyden of CBRE noted that the recent activity and heightened interest in the remaining 6,000 sqm of available space highlighted an ongoing flight to quality trend in the Brisbane CBD, as occupiers sought out buildings with strong technology overlays, base building amenity and efficient floorplates to suit evolving workplace needs.
“These trends were already apparent pre COVID-19 but have gained added momentum in the past year, which is likely to result in the vast majority of active CBD tenant demand gravitating to prime office offerings in 2021.”
He said strong interest in 32 Turbot Street is coming from federal government, resource and legal tenants.
The tower was the first building in Brisbane to achieve a 6 Star Green Star Rating (Office Design and As-Built V2) and also offers a 5.5 Star NABERS Energy rating. Features include rainwater harvesting for bathroom facilities, external façade screening and high-quality end-of-trip facilities including over 293 bike racks.
Knight Frank’s Jamie Nason said the building’s leasing success came amid a rebalancing in Brisbane leasing conditions in 2021 as business confidence and sentiment improved.
“We anticipate that a series of major occupiers will re-enter the marketplace this year considering both their physical premises and new workplace strategies.”
“Flexibility will remain key for major occupiers and landlords will need to demonstrate their ability to provide added tenant amenity such as enhanced collaboration spaces and quality retail offerings.”
Brisbane CBD vacancies were expected to increase to about 15.7% in mid-2021, due predominantly to net absorption and increasing levels of new supply. Negative net absorption of 13,513 sqm during the March quarter has already seen vacancy rates in the CBD rise to 13.6%. Vacancies across the entire CBD market expected to remain elevated during 2022 before beginning to see material decreases during 2023.
Nason noted that while overall lease transaction volumes had dipped, not unsurprisingly, in 2020 due to COVID-19, the Prime grade sector had been the most resilient.
