This article is from the Australian Property Journal archive
THE dual-tower Zenith office complex in Sydney’s Chatswood has put out the no vacancy sign, after owners Centuria and BlackRock leased up more than 44,500 sqm across 54 deals since acquiring the asset for $279 million in 2016.
It is the latest demonstration of the tenants flocking Sydney’s north shore office market amid tight supply and hefty rents in the CBD.
Government tenants Transport for NSW and the NSW Department of Health recently signed a 20,000 sqm renewal, while major property player Lendlease recently signed a 3,120 sqm extension over levels three, four and five of Tower B for five years.
A further 1,869 sqm was leased to McCabe Curwood in an eight-year deal, “enticing the company out of the CBD into the value-for-money Chatswood locale”, Centuria head of real estate and funds management, Jason Huljich said.
“The success of this building is testament to the experience and capabilities of Centuria’s and BlackRock’s in-house teams, but it also demonstrates a market turnaround for the North Shore.
“As rental levels hit new highs throughout Sydney and space becomes scarce, many blue-ribbon tenants are finding value outside of the CBD, just like law firm McCabe Curwood,” he added.
Rents of up to $660 per sqm net were achieved within the asset. According to Savills, net effective rents in the CBD fetch $965 per sqm for premium-grade buildings, and $845 per sqm for A-grade spaces.
Another 34 deals within Zenith were made over part floors and suites encompassing more than 15,600 sqm. Among the tenants include Sennheiser, Australian Pharmaceutical Publishing Company, DEM Architects, Insurance Australia Group, Michael Page Recruitment, Altium, and Regus.
The leasing deals take the property’s overall weighted average lease expiry from around 2.7 years when it was acquired to 4.5 years.
The asset was acquired in July 2016 for $279.1 million by Centuria through its unlisted funds business in partnership with a private real estate fund managed by leading global asset manager BlackRock in July 2016.
Our team have created a workplace that has everything possible to make travelling to and from work, and working, eating, and exercising throughout the day, as attractive and beneficial to the people in these buildings as possible,” Huljich said.
The owners undertook a series of refurbishment projects, which included the introduction of green spaces and gardens, a café and childcare centre, new end-of-trip facilities and a “weekly exercise and wellness program”.
“With natural light on four sides and 360 degree views of Sydney CBD, the Blue Mountains and the Pacific Ocean, these features – as well as the property’s proximity to the North Shore transport network – not only make it attractive to organisations, but provide a significant and positive impact on the lifestyle and well-being of tenants,” Huljich said.
Centuria recently acquired a $520.9 million portfolio of four east coast office assets for the Centuria Metropolitan REIT.
Australian Property Journal
