News & Discussion: CBD Real Estate & Market Conditions

[AtD]

Quite right. This is exactly what Canberra City Centre (they call it Civic over there) is like. Nobody goes there except those who live close to it.

Great example! Canberra is split up into a small number of 'towns,' and with Queanbeyan over the border. As a result, the city is lifeless, and feels like a rural town with a shopping mall. No one goes into the city because there's nothing to go there for. All the nightlife and attractions are in the suburbs.

[Howie]

What is it with Adelaidians bagging their own city on SSC?

Here's the crossposting of this thread on SSC..
http://www.skyscrapercity.com/showthread.php?t=622038

I've well and truly given up on that place.

[crawf]

Yeah sorry about that Howie, I've since cleaned it up.

StopTheWar is a forumer you love to hate. A huge part of me would love to wipe him of that forum for good, though we need members like him to keep a balance even if majority of his posts are negative. However some of his recent posts has put him on notice

[UrbanSG]

In today’s Advertiser it has been stated that BHP recently signed for an extra 1,400 square metres of space at 45 Grenfell Street (despite the recent shared services staff cut backs, must be for the odx team instead).

Allianz has also recently expanded into 2,853 square metres of office space at 55 Currie Street. I have a friend who works at Allianz, they occupy level 2 and 10 with plans to keep expanding in Adelaide due to our low office rents, higher unemployment rate and better quality of applicants (as a result of this higher unemployment rate) compared to Brisbane.

Whilst this demand is great I want to see BHP move to an office building that reflects the large scale of what they are planning in SA not their current building. The SA government needs to confirm TransportSA's new home this budget after the delay last year (but who knows if they will or not). I also want to see at least one of those large tenants seeking space (mentioned recently in the afr) sign up to a new tower. The other states keep getting large government and private tenant commitments. We haven’t had a large one for a while now in Adelaide. Please, one of you lot sign up to a new office tower soon

[UrbanSG]

I found a copy of the April 2008 Knight Frank Office Market Overview by chance today on the internet. Overall it is very positive. Makes for an interesting read. Particularly page 6 with tenant requirements. The ATO not is mentioned as it was in the AFR but that may a print timing issue. The other major requirements are listed though.

Also page 4 is interesting, some mooted developments I had not heard of before.

Hope this link works.

http://www.knightfrank.com/ResearchReportDirPhase2/11336.pdf

[Shuz]

Thats a very resourceful guide. The developments which have not been heard of as yet:

80 Grenfell Street - a 26,000sqm office building.
(Google Maps tells me this is the site of the Harris Scarfe complex, but the development application lodged does not encompass this address.)

62-66 Currie Street - 15,000sqm office building.
(Directly opposite MTAA building)

Confirmation that 73-79 Pirie St is still going ahead, completed during or after 2010.
43-56 Franklin St development expected to come online during or after 2010.
Yorke Commercial Campus coming online in same timeframe.

[Ben]

Thats a very resourceful guide. The developments which have not been heard of as yet:

80 Grenfell Street - a 26,000sqm office building.
62-66 Currie Street - 15,000sqm office building.

Confirmation that 73-79 Pirie St is still going ahead, completed during or after 2010.
43-56 Franklin St development expected to come online during or after 2010.
Yorke Commercial Campus coming online in same timeframe.

80 Grenfell St is the Hariis Scarfe redevelopment but the Currie St building is interesting. Good to see some more potential bulk along that strip. That should be a decent Size building too.

[crawf]

Look forward to hearing more details about this Currie St development, that street is ripe for development.

[omada]

crawf: Look forward to hearing more details about this Currie St development, that street is ripe for development.

Another 7lvl skyscraper no doubt

[loud]

17,000 square metres for Origin Energy plus 2 other similar requirements, that is a lot of space being demanded and considering the very low vacancy rate we have just reported it will be good to hopefully see some more large pre-committments this year, last year was a bit quiet with only a couple of new announcements.

Origin? Hi, Omi here. Listen - I've got this great building for you. It's on Currie St. and it has this nice big curvy thing on the front.....

Exactly what I was thinking. These 3 companies with 17,000 square metres = 3/4 of the Currie Street Tower.

Too bad they wont be prepared to pay the insane rent required...

[UrbanSG]

Continued good news for the office market in Adelaide, especially compared with the 20%+ office vacancy rate of 1997! Hopefully the current economic climate does not start to reverse the positive trend.

Record Low Vacancy for Adelaide's Offices

RUSSELL EMMERSON

August 05, 2008 11:30pm
ADELAIDE's offices are fuller than ever with the city hitting a record low vacancy rate of 3.7 per cent.

This compares with January's vacancy rate of 4.3 per cent and vacancies of 20.6 per cent in 1997.

The Property Council data, released at a breakfast in Adelaide this morning, shows continued strong demand for space within the city, leading to increasing rents.

State director Nathan Paine said the results were good but the question remained about where future demand would come from.

"While I am an optimist for the mining and resources booms, I am bearish about the market for the next 12 months,'' he said.

"Overall, it really shows businesses aren't coming from interstate.

"But the stars are starting to align so we will see deals kick off when we get the mining offices and the tenants from the eastern states.''

CB Richard Ellis associate director of research Glenn Lampard said Adelaide's result was good, but vacancies in Perth (0.3 per cent) and Brisbane (1.2 per cent) opened up other questions.

"It really makes you wonder at 4 per cent whether Adelaide's vacancy rate is high, and how low it can go,'' he said.

The report shows 30,000 sqm of office space coming into the market in the second half of this year, and another 45,000 sqm planned for the following 12 months.

But a lack of confirmed projects is putting an upper limit on growth, Mr Lampard said.

"In the current environment, with the credit squeeze, finance is virtually dried up, debt is a problem, so it is difficult to get projects off the ground,'' he said.

"There is a dearth of construction in the pipeline going forward.''

In particular, he said prime city construction sites that would once have housed new office towers are now being used for student accommodation and residential developments.

[Shuz]

20%!? That's insane. That's like 1 in every 5 floors empty. Let's never go back to that again.

[Will]

20%!? That's insane. That's like 1 in every 5 floors empty. Let's never go back to that again.

I remember those days. Pretty much every building in the CBD had 'For Lease' signs, but in addition there were quite a few buildings which were completely abandoned.

[skyliner]

BUYER CIRCLES ADELAIDE'S HYATT (From the AFR P 49 4/9/08)

The privatised Grand Hotel Group is closeto selling it's Hyatt hotels in Canberra and Adelaide for more than $200m.

Singapore's Tuan Sing Holdings, which controls Grand Hotel Group, and funds controlled by Morgan Stanley Real Estate are believed to be circling the Hyatt Regency in Adelaide.

It wants to take full control of the hotel in a $100m deal which signals confidence in the city.

Room rates are rising in Adelaide because of the state's economic boom, and more than 1200 hotel rooms are slated to open.

New hotels include the Crowne Plaza in Hindmarsh Sq, a hotel in the old CML building on King William St, a boutique hotel on Hindley St and an airport hotel.

Meanwhile the Hyatt Hotel in Canberra is expected to sell to an external party keen to tap in to the capital's tight supply dynamic.

Grand Hotel group will keep it's larger Australian holdings, the Hyatt Regency Perth and the Grand Hyatt in Melbourne, as they are performing strongly. The total portfolio was valued at $615.4m last yearby Jonmes Lang Lasalle Hotels.

The Adelaide hotel has 367 rooms, Canberra 249, Melbourne 548 and Perth 347.

Morgan Stanley and marketing agents David Gibson and Mark Durran of Jones Lang Lasalle Hotels declined to comment.

The two sales could take some time to complete, executives said.

However, the activity demonstrated that strong demand for hotel assets had continued despite the credit crunch.


Good to see the demand in Adelaide and the reference to the boom as if already under way.

ADELAIDE - TOWARDS A GREATER CITY SKYLINE

[Will]

I hope they retain the 'Hyatt' brand.