Investa Office (‘Investa’) today announced it has leased 180,000 square metres of space across its office portfolio this calendar year, across all major Australian CBD markets.
More than 130 government, SME, national and multinational tenants have secured space in Investa buildings since January 2013. Major deals include a renewal and expansion by Chevron of 28,500 square metres at 250 St Georges Terrace in Perth, a Commonwealth Government lease renewal at 140 Creek Street, Brisbane for 7,286 square metres and in Canberra, Telstra signed up for 13,250 square metres at 16-18 Mort Street, in addition to securing 30,165 square metres for their Sydney headquarters at 400 George Street, Sydney.
Michael Cook, Group Executive, Capital Transactions, Commercial Development and Leasing said: "There is no doubt the office leasing market has been tough, tenant demand has been soft, with many opting to consolidate or reduce space, putting downward pressure on rental growth. Despite this, we have been able to maintain strong leasing performance across our portfolio."
While incentives remain higher than the long-term average, Investa reports that increases in face rents have been achieved.
Jason Leong, Chief Operating Officer added: "When market conditions are soft, flexibility and collaboration with tenants is vital to minimising vacancy. We have focused on working with tenants to understand the specific occupational needs of their business and then tailored our space and lease structures accordingly.
By doing this, we have been able to assist a wide range of tenants with office expansions, space consolidation and temporary relocation during refurbishments."
In Melbourne, Investa negotiated a 1,689 square metre lease at 120 Collins Street for trading, services and investment firm Mitsui, before the space was advertised. This was the second time in 14 months Investa was able to accommodate Mitsui’s growth in the building.
In Sydney, Investa has leased 92,000 square metres since January, with 8,355 square metres finalised at 1 Market Street, 4,945 square metres at 31 Market Street and 4,176 square metres at 130 Pitt Street. In June, Meat & Livestock Australia finalised a new lease for 2,471 square metres at 40 Mount Street, North Sydney and in August, Telstra leased 3,088 square metres at 151 Clarence Street in conjunction with Westpac, who secured 4,493 square metres.
Investa has also been quick to identify trends in the broader market and leverage these to maximise opportunity across its assets.
Mr Cook said: "In Sydney and Brisbane, we have seen an increase in demand for fitted-out space and we were able to deliver this across a number of our assets, including 4 - 52 McDougall Street, Brisbane and 126 Philip Street, Sydney.
In Brisbane, we anticipated demand for sub-500 square metre space and were able to split floors to meet this demand. At 239 George Street, Brisbane, eleven leases to different firms seeking space in this size bracket have been finalised recently.
In today’s market it really comes down to working harder and being responsive to the individual needs of current and potential tenants, across different buildings and markets," said Mr Cook.