Sydney Office

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Dexus, Australia's biggest office landlord, has taken full control over the MLC Centre in Martin Place.
The ASX-listed group already owned half of the building, and have implemented a purchase right over the remaining half that was <a href="https://www.urban.com.au/expert-insights/investing/94197-half-of-harry-seidler-s-mlc-centre-to-be-sold-by-gpt" target="_blank">first listed in January</a>.
It is believed Dexus have paid $800 million.
Just last week Savills Australia’s Ian Hetherington, Simon Fenn and Ben Azar, and Cushman &amp; Wakefield’s Josh Cullen and Mark Hansen were been appointed to market the landmark asset.
The 50% stake, which was owned by the GPT Group, has a book value of $725 million.
The proceeds will be directed to new office and residential towers GPT at Melbourne Central shopping centre and at Parramatta.
GPT chief Bob Johnston said the group’s investment in the MLC centre had delivered investors an “exceptional” return.
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Dexus take full control of MLC Centre

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The real estate investment trust, GPT Group has announced it will sell its 50 per cent share of the MLC Centre in Sydney’s central business district.
It is speculated the stake could fetch $800 million. It has a $725 million book value.
The proceeds will be directed to new office and residential towers at Melbourne Central shopping centre and at Parramatta.
GPT chief Bob Johnston said the group’s investment in the MLC centre had delivered investors an “exceptional” return.
The sale will see GPT’s Sydney office exposure fall from 65 per cent to 60 per cent.
It will lift its Melbourne exposure from 30 per cent to 34 per cent.
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Shares in GPT closed flat at $5.53 yesterday. 
GPT jointly owns MLC Centre with office landlord specialist Dexus who paid $722 million in 2017 when it was sold by QIC.
In 2011 GPT had offered to sell its half stake in Sydney’s iconic MLC Centre to their then co-owner QIC.
In its 2010 annual results, the group’s share of the 67-storey, Harry Seidler-designed building was valued at $368 million.
The MLC Centre was built by Lend Lease in 1978. GPT bought a 20% share in 1990.
In 1996 GPT increased its share by 15% and QIC bought a 25% stake following MLC selling a 40% interest in the building.
In 1997, GPT and QIC picked up the remaining 40% held by MLC to become equal owners of the building.
Dexus chief executive Darren Steinberg says the property trust will consider buying the other half of Sydney’s MLC Centre.
 
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Half of Harry Seidler's MLC Centre to be sold by GPT

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Sydney's newest office building has set the record for the most expensive office rental in the Sydney CBD.
It is at an annual net face rate of more than $1800 a square metre at 60 Martin Place.
The 33-level premium-grade building topped out on Wednesday, in a project being undertaken by Investa Commercial Property Fund and Gwynvill Group.
Higher floors have been leased at an annual net face rent of more than $1800 a square metre, while lower floors were averaging around a net annual face rent of between $1200 to $1300 a square metre, Investa group executive Michael Cook said.
Its three latest tenant signings have taken leases of over 9000sq m on terms of between 10 to 15 years.
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Flexible workspace provider International Workplace Group has agreed terms on 4500 square metres within the building's podium across levels one to three, with plans to use them as a co-working hub called "Spaces".
Financial services group, Munich Re secured 2600sq m of space on levels 27 and 28, moving out of its own building on Macquarie Street.
The Japan megabank, Mizuho Bank will relocate from 60 Margaret Street to levels 29 and 30, occupying 1900 square metres.
Other tenants which have committed to 60 Martin Place include Norton Rose Fullbright and Banco Chambers.
"The interesting thing is that incentives had been stubborn, and we are into the teens. I am surprised prices have been sticky on the way down but it is a function of the fact that a lot of organisations struggle to justify the capital expenditure of a fitout," Mr Cook told Nine Entertainment.
"There is more elasticity in rents than fitout costs. I would rather have my incentives and rents a little higher because we are producing a cashflow, and I use the incentives to support a cashflow."
Mr Cook said only four to five floors were still available for lease.
The HASSELL-designed building with state-of-the-art end-of-trip facilities is on track for September completion.
In 2016 Investa Office Management Pty Ltd raised $600 million in equity and another US$150 million through a US private placement after it acquired a 50 percent stake in the 40,000 sqm office redevelopment.
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60 Martin Place sets record Sydney rent

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Crown and Goulburn, the office block on the fringe of Surry Hills and Darlinghurst, has been listed for sale.
The modern office development, named after its location on the corner of Crown and Goulburn Streets, was approved by the City of Sydney last month.
The 2,190 sqm development designed by SJB Architects will span five levels and comprises retail and commercial spaces.
There will be a cafe fronting Goulburn Street.
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The property is to be constructed by Impero Constructions with Ecological Sustainable design initiatives, encompassing contemporary office spaces, as well as gardens and rooftop terraces.
It's the first non-residential project for developer Luke Caplis, who amalgamated four lots which his firm, Freehold Capital, started buying in 2017. They have combined to a 665 sqm plot.
Caplis described the project as "an innovative offering for businesses seeking world-class urban premises."
Colliers International agents Adam Woodward, James Barber and James Mitchell are offering the 100 percent freehold, with an international expressions of interest campaign closing April 12.
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Adam Woodward called Crown and Goulburn a "prestigious, market-setting commercial development in the Sydney Fringe."
“The amenity on offer including high class end of trip facilities are on par with a premiere CBD office building," Woodward added.
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“The building’s location on the cusp of Darlinghurst and Surry Hills offers a host of colourful attractions and unbeatable convenience with train, bus and future light rail transport close at hand and ease of parking compared to CBD counterparts.”
James Mitchell said the Sydney CBD fringe is changing into a commercial hub.
"Previously viewed as just a sub-market of the CBD, it (a commercial hub) is fast becoming a focus for investment groups, as tenants flock to the area," Mitchell said.
 
 
 
 
 
 
 
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Crown and Goulburn office development to change the face of Darlinghurst, Surry Hills fringe

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A new co-working space has opened in Sydney’s CBD.
The GPT’s Group’s Space&amp;Co venue at 580 George Street Sydney will occupy more than 1,000 square metres on Level 10.
The space will be able to accommodate 160 members.
Features and amenities will include workstations, two boardrooms, secure internet connections, private suites and multiple meeting spaces, GPT’s National Director, Flexible Workspace Solutions Shey Hooper said.
“Our new Space&amp;Co. venue has been specifically designed to deliver to the growing interest we are seeing from businesses of all sizes for flexible workspaces that offer more privacy and digital security,” Hooper said. 
“We continue to see strong demand for our premium flexible workspaces, including 580 George Street where we have now increased the size of our Space&amp;Co. a second time since we opened in the building in 2016.”
“The opening of our new Sydney venue follows the successful expansion of Space&amp;Co. in Melbourne – where we now have four venues with around half of our members drawn from the existing tenants in the buildings where we operate.”
BVN Senior Practice Director Sally Campbell said the design of the new venue had been shaped by the evolving needs of members.
“We are now able to collect data from existing sites which provides a deeper understanding of the challenges Space&amp;Co. customers face in their own businesses and how that impacts their space requirements,” said Campbell.
“Space&amp;Co. is a provider of real estate solutions that support evolving businesses, and for this reason it is a necessity to incorporate flexibility in both environment and service to be able to respond quickly to tenants ever changing needs. Adopting an attitude of constant evolution is critical.”
Hooper said the said the venue benefitted from being in Sydney CBD’s Midtown area, which has emerged as a hub for start-ups and international technology and creative firms.
“580 George Street includes the best amenities and is arguably the most convenient location for any workplace in Sydney,” said Hooper.
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New co-working space opens in Sydney CBD 

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Flexible workplace provider Spaces is expanding, announcing that it will open a new co-working space at 60 Martin Place in Sydney’s CBD.
The three podium level, 4,500 square metre space in the building owned by Investa &amp; Gwynvill Group will open in February 2020.
Spaces is an IWG brand and its new co-working space will aim to offer professionals a creative working environment for the city’s entrepreneurs.
The IWG Global Workplace Survey 2019 found that, in Australia, the demand for flexible working has grown among employees, while 92% of employees can become more productive through introducing flexible work.
Simon van Grootel, Development Director for IWG Australia, said the new Martin Place location fits with the growth of the Spaces brand with and its dynamic relationship with occupiers and landlords.
“Undoubtedly the best building to be built in Sydney for a number of years, this presented a fantastic opportunity to further our existing relationship with Investa and bring to market our first Sydney CBD Spaces location in Martin Place,” van Grootel said.
“As we continue to grow our footprint nationally this will be a great showcase to occupiers and landlords alike as to the engaging environment that Spaces provides.”
Damien Sheehan, Country Head of IWG Australia, said it was important for Spaces to expand their brand across Australia.
“We are very excited about this new offering and the timing couldn’t be better with demand from our enterprise clients showing dramatic growth,” Sheehan said.
Joe Ward mentioned that IWG plc has been seeking a flagship premises for Spaces in Sydney CBD for around two years.
“The attraction for Spaces was a premium grade, landmark building in the central iconic location of Martin Place which is positioned amongst major tech and professional services businesses,” said Ward.
“As a hotly contested space, the landlord was keen to secure the right flexible workspace provider for the building to match to quality of the building and align with the future tenants expected to occupy this new 31 level tower.
“The three large podium floors overlooking Martin Place, is ideal for Spaces to introduce more collaborative workspaces and rapidly grow the brand nationally.”
Ward said Spaces has four locations in Australia across Melbourne and Sydney, which is set to double in 2020 and expand across all the major capital cities.
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New co-working space at 60 Martin Place announced 

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A shift in Sydney’s white-collar employment mix is driving demand for shorter-term leases and more flexible workspaces, according to recent findings from CBRE.
This is a key finding of CBRE’s recent review of the Sydney office leasing market, which highlights that Professional Services has overtaken Finance and Insurance as the city’s top employer. 
The review also highlights a significant increase in agile and co-working space to meet the market’s changing requirements – both in Sydney and on a national basis. 
CBRE’s Head of Capital Markets, Office and BTR Research, Ben Martin-Henry said, “agile space take-up accounted for 17% of national net absorption in 2018, which is further evidence that the sector is becoming more mainstream as tenants are increasingly looking for more flexible options"
“Co-working and serviced office providers currently occupy approximately 156,000sqm - around 3% of stock – with a significant take-up in the last 12 months as they look to accommodate the requirements of the changing workplace,” he added. 
Chris Fisher, CBRE Director of Advisory &amp; Transaction Services, Office Leasing said that Sydney had traditionally relied on the Finance and Insurance industries, but the market was experiencing a clear shift in both the make-up of occupiers and their office space needs.  
“Enterprise agreements with co-working providers are gaining momentum, with larger corporations leasing up to three hundred seats at a time on short-term agreements"
“Flexibility is a key consideration for corporations and one size does not fit all. Landlords increasingly need to understand tenant drivers and adopt flexibility to remain competitive,” Mr Fisher concluded
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Flexibility is key in Sydney’s evolving office leasing market: CBRE

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A local high net worth individual has spent $16 million on the former Bank of New South Wales building in the Sydney CBD.
The vacant three storey office block belonged to the Shanghai based Dahua Group who had paid $4.6 million in 2009.
The building at 25 King Street, one the corner King and Sussex Street, has a net lettable area of 969 sqm and sits on a 278 sqm site.
It is listed as an item of local heritage significance, having been originally constructed in the early 1890s for the purposes of the western branch of the City Bank of Sydney.
The Dahua Group recently spent $7.4 million on extensive building refurbishments which included a full façade restoration, reparation of spiral staircase, specialist plasterwork and conservation of pressed-metal ceilings.
New works included an interconnecting stair, lift and rooftop deck.
Architect Design Studio Group undertook the works with building firm Built.
Andy Hu and Jordan Lee of Savills Australia secured the sale.
Hu said the building’s prominent corner location benefits from high pedestrian and vehicular traffic and the roof top terrace boasts views of Darling Harbour and Cockle Bay.
“This is a landmark boutique building which offers a vast selection of open workspaces, function areas, timber and stone floors throughout and three sides of natural light with amazing water views”
 
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Former Bank of NSW building in Sydney sells for $16 million

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A $1 billion curvaceous skyscraper at 60 Martin Place - that leans over the historic interwar-era St Stephens Church - has been completed.
Investa Commercial Property Fund (ICPF) and the co-owner Gwynvill Group (Gwynvill) developed the site.
The building was designed by Hassel and contains more than 40,000 square metres  of net lettable area. 
Norton Rose Fulbright, Mizuho Financial Group, Munich Re, Banco Chambers and Spaces are among the core tenants. 
The building will also home to a rooftop garden, as well as the new Toppi Martin Place restaurant on the street corner. 
The building has reached 100% practical completion of all digital assets (71,848 in total) within the 33-level building and the creation of a 'digital twin', driven by Willow and the lead contractor Lendlease.
Rather than an analogue asset register compiled offline, Investa will utilise a digital twin of their asset, i.e. a 'single source of truth'.
This digital twin records and validates all aspects of the building’s equipment, warranty information, operation and maintenance information within an intuitive 3D environment to drive more efficient depreciation planning in operations. 
The digital completion of a building this scale is of great significance, Investa claim.  
It says that previously facilities management teams would have spent months developing this information from scratch, resulting in a sub-standard digital record post-completion.
According to ICPF's group executive and head of commercial development, Mark Tait, the building is currently 80% leased. 
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$1 billion curved skyscraper completed in Martin Place

A glamourous Sydney CBD office suite has sold for $890,000

The 37 sqm office last traded in 2013 when bought for $375,000 by chemical supplies executive Michael Snounou, who is facing trial for allegedly importing methamphetamine ingredients.

Snounou was committed last month to stand trial for 32 offences but is yet to enter a plea.

Snounou’s tenant at the 350 George St premises is the Robb Report, the luxury brand magazine publisher.

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When the ANZ secured permission to auction the heritage-listed property, the NSW Supreme Court was told there was expected to be a surplus from the sale.

It was listed through Belle Commercial agent Andrew Vines who expected buyers to pay around $25,000 per square metre.

The result was closer to $24,000 per sqm.

Some 10 contracts were issued. The net proceeds will be held by the NSW Trustee and Guardian until further order.

The 1870s building was designed in the Federation Romanesque style.

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The 37 sqm office last traded in 2013 when bought for $375,000 by chemical supplies executive Michael Snounou, who is facing trial for allegedly importing methamphetamine ingredients.

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