This article is from the Australian Property Journal archive
STOCKLAND and the federal government have joined the race for office space in Melbourne, at a time when the vacancy rate continues to tighten.
JLL has been engaged by both Stockland and the government.
Stockland is on the hunt for 1,250 sqm to 1,750 sqm of A-grade office space within the CBD, Docklands or Southbank.
The diversified property group is looking to move relocate around Q1/2 2020, although it will consider moving in earlier, as early as Q1/2 2019.
It is lock in a 10-year lease plus options.
Stockland currently leases space within Dexus’ 452 Flinders St, which it sold to Dexus in 2011 for $201.5 million. It has been at that address since 2007.
Meanwhile the government is searching for 4,000 to 6,000 sqm of A-grade space.
Its preferred location is within the northern and inner western suburbs.
It is also looking to sign a 10-year term plus options.
These latest two entrants comes as the vacancy rate across the CBD and metro area continue to tighten.
The Property Council Office Market Report released in February revealed the CBD vacancy rate fell from 5.9% to 4.6%, and forecast it will fall further.
Meanwhile a Knight Frank report last month shows vacancies in the suburban markets fell from 7.0% to 5.2% over the 12 months to March 2018. Vacancies in the north & west region fell from 6.8% to 5.9%.
Gross new supply added to the market in 2017 totalled 30,200 sqm, down by 28.6%, while more than 27,000 sqm is expected to be added this year. Overall net absorption in 2017 came in at 73,781 sqm, up by 36.8%.
The north & west region will see the new Target Head Office at 2 Kendall Street, Williams Landing of 12,919 sqm, and 1-3 Janefield Drive, Bundoora of 4,000 sqm reach completion by the end of 2018, after no new developments were completed in 2017 in the region.
Australian Property Journal
