Brisbane’s office market remains relatively unscathed by Covid-19 with office vacancy growing slightly from 12.7 to 12.9 per cent in the six months to July.
Office vacancy in south east Queensland performed better than Sydney and Melbourne which increased 1.7 and 2.6 per cent according to the Property Council of Australia’s Office Market Report.
The Gold Coast also performed relatively well in Queensland with vacancies moving from 12.8 to 13 per cent. Brisbane fringe suburbs jumped from 13.6 in January to 14.2 per cent in July.
However the extent of Covid-19’s impact on the future of office space in the region is unclear, according to office leasing experts.
Knight Frank partner Mark McCann said the Brisbane office market is experiencing, like all markets, a general downturn in transactional activity as many corporates come to terms with the current crisis and navigate their business going forward.
“With the exception of [Dexus’] The Annex at 12 Creek Street, there has been no new supply additions in the CBD and as such we do not anticipate significant fluctuations in the overall vacancy rate for the CBD,” McCann said.
“The extent of sublease space has not yet been realised in Brisbane but we do anticipate pockets of sublease to emerge over the coming months as corporates begin to finalise their new workplace designs post-Covid-19.
“The current average re-occupancy of most CBD building is between 50 to 60 per cent.”
Savills state office leasing director David Howson said that with the uncertainty in the market, tenants are continuing to review their office space requirements, with many no clearer as to the longer-term effects on their occupation.
“Those facing imminent expiries are looking for opportunities to extend or hold over their current leases, or re-set in better quality accommodation at terms similar to current passing rates,” Howson said.
“Current market murmurings foreshadow an influx of fitted space—both sublease and backfill—within the prime and secondary markets, with prime seen as potentially witnessing the greatest change in vacancy.”
McCann added that the focus of most owners during the first half of 2020 has been the implementation of capital works programmes on building and lobby upgrades, along with new wellness and hygiene initiatives to future-proof their assets going forward.
“While transaction volumes are low, we have not seen downward shifts in asking rents across the prime grade; incentives continue to be the trigger to increase marginally for any active tenants in the current market wanting to transact now.
“The B-grade market continues to be the most volatile, with higher tenant demand levels, but for space of less than 500 square metres.”
Earlier this month, Charter Hall lodged plans for a 35-storey office tower in the CBD while Cornerstone Properties submitted plans for a commercial tower in Brisbane’s Fortitude Valley fringe.
Sekisui House recently lodged plans for a commercial building in West End.
Meanwhile investors and developers are looking for opportunities to obtain new assets while the market is down or revamp older stock to meet new tenant demands.
This article is republished from theurbandeveloper.com under a Creative Commons license. Read the original article.
Barwon secures Princess Alexandra Hospital car park
Barwon Investment Partners has snapped up a multi-level car park and medical centre on a site with significant development upside opposite Princess Alexandra Hospital.
The Woolloongabba asset at 250 Ipswich Road is setting the healthcare focused fund manager back around $95 million, reflecting a circa four per cent net passing yield.
The property contains an eight level, 773-bay garage attached to a two floor wellness centre with 21 tenancies, anchored to Gabba Dermatology, Brisbane Cardiology and Allied Health; the Weighted Average Lease Expiry is nearly seven years.
A pedestrian overpass connects the building to the Princess Alexandra Hospital, also a major teaching campus, employing 6810.
The 5106 sqm block has significant upside – up to 15 storeys based on its zoning, according to JLL’s Seb Turnbull, Elliott O’Shea and Simon Quinn, who marketed the asset with a Blight Rayner scheme.
BIP invests again
Established in 2006, BIP holds a property portfolio worth $2.3 billion.
Its medical related product, much held in a Healthcare Property fund, is priced at about $1.4b as at March, 2022.
Seven months ago, for the trust, the manager paid Forza Capital $34.7m for a South Brisbane medical centre – not far from 250 Ipswich Rd – and two Canberra assets including Belconnen’s Ginninderra Medical & Dental Centre on nearly a hectare.
Also late last year BIP spent $75m for a 12 level St Kilda Rd office majority leased to Alfred Health.
More to come.
Article source: www.realestatesource.com.au
Brisbane’s Office Market Greenlit for Business
Brisbane’s office market continues to shake off the pandemic doldrums with two new commercial towers approved in the CBD and fringe suburbs.
Property owner PGIM and development partner Indema’s plan for a bold adaptive reuse of a 1970s commercial building at 444 Queen Street has won approval.
The bronze 22-storey tower opposite Customs House will be stripped back to its core structure and completely remodelled with a new podium, curtain wall facade and an additional two-storey sculptural canopy.
Indema director Michael Bruderlin said they would be targeting a net zero certification for the building upon completion in the first quarter of 2024.
Article source: www.theurbandeveloper.com
Developer Pitches for $130m Shop-Top Housing on Bayside
Brisbane’s bayside could be going up in the world with plans for $130-million highrise shop-top housing in the heart of the seaside suburb of Wynnum.
Brisbane-based developer Hambros has lodged plans for a 21-storey apartment tower on the vacant lot neighbouring the Wynnum Central Shopping Centre, after winning approval for an small extension to the retail centre late last year.
The development comprises a 6-storey retail and commercial podium, with a 275-apartment tower above, backing on to Wynnum Central Park.
Hambros has reportedly spent about $14 million on revamping the Wynnum Central Shopping Centre on Bay Terrace, as part of a $74-million plan to rejuvenate Wynnum, including cinemas.
According to planning documents lodged with the Brisbane City Council, the tower will be made up of 54 one-bedroom apartments, 148 two-bedroom apartments, and 67 three-bedroom apartments, with six penthouses, which will have private rooftop space and their own pools.
The building height is well in excess of the allowable five to eight storeys in the Wynnum Manly Neighbourhood Plan, but town planners Gateway Survey and Planning argued the plan was “outdated” and should be overhauled.
The six-storey podium would contain two levels of parking, a retail tenancy at ground level, a floor of retail, with two storeys of commercial space for office, healthcare and events space on levels 5 and 6.
In a statement to the council Hambros director Justin Ham said the Wynnum CBD had been left behind “with no development occurring in the last 20 years”.
“Our project is designed to put Wynnum CBD on the ‘open for business’ map,” Ham said.
“This landmark development, with a construction cost estimated at $130 million will have a huge financial and community positive impact on the Wynnum CBD and surrounding areas.
“It’s a once-in-a-lifestime opportunity to create a beautiful space overlooking the best bay in the world.”
Ham said the development would bring much-needed foot traffic to the heart of the Wynnum CBD and help bolster businesses and landowners he said were struggling to remain profitable.
Taiwanese developer Shayher Group won approval for a masterplanned retail precinct at Wynnum Plaza with plans for 184 apartments across eight residential buildings as well as boutique cinemas and increased retail space, reportedly worth more than $100 million.
Work on the Wynnum Plaza redevelopment was due to commence later this year with a completion date hedged for 2024.
Article source: www.theurbandeveloper.com
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