Activate Perth fills city’s empty spaces

Urban regeneration specialist Activate Perth is gaining traction in Perth’s CBD, filling five vacant spaces in recent weeks under its innovative rent-free, rolling lease model.

The new leases are located across the central city at London Court, Brookfield Place, the Bon Marche Arcade, Yagan Square, and Westralia Square.

Artist Rupert Corry has established Story Horse in London Court to sell his repurposed marine and block timber photographic art; WA Poets Incorporated has set up in Bon Marche Arcade; florist Wilding Studio Blooms has taken up space at Yagan Square; the Town Team Movement has moved into Westralia Square; and giftware retailer 29 Lines has moved into Brookfield Place.

Activate Perth chairperson Di Bain told Business News the group had received more than 100 expressions of interest from potential retailers seeking to take up space under the not-for-profit’s lease model.

Ms Bain said property owners had been similarly enthusiastic, embracing the opportunity to enliven empty shopfronts and offices.

“We are trying to make it cost-neutral for the property owner and make it a low-risk environment for the participant to be able to test their concept,” she said.

“Typically we like the space to be free, with the tenant paying the outgoings.

“The generosity of the landowner is to donate their space, but they don’t want to be losing money.”

Activate Perth’s leasing model, which it describes as licences, is designed to be a panacea for landlords dealing with rising retail vacancies across the CBD.

Recent research from commercial agency JLL showed retail vacancies in Perth’s CBD hit an all-time high of 17 per cent in the first half of 2019.

“Terms are negotiated on a case-by-case basis, but they are all short-term licences,” Ms Bain said.

“The aspiration is that a certain percentage of them would convert into long-term leases.”

Activate Perth general manager Ragen Haythorpe said while filling a space through the agency did not provide a direct financial return for landlords, there were other benefits of providing space for startup businesses.

“A vacant tenancy doesn’t look very appealing, so we are improving the visual amenity and we are attracting foot traffic, which has a beneficial effect for surrounding tenants,” he said.

“As spaces fill, it makes a potential retailer that may take a five-year lease see the space in a different light.

“We are making it also commercially appealing for future commercial tenants and negating the anti-social behaviour that comes around and the negative sentiment of seeing all these vacancies everywhere.”

Established in 2017 and based on similar initiatives in place in Adelaide and Newcastle, Activate Perth aims to create vibrancy and activity in hard-to-fill commercial tenancies across Perth’s CBD.

Ms Bain said Activate Perth, which is largely a volunteer agency but also receives funding from the City of Perth, was seeking to place 11 businesses in empty spaces each year.

“The highest purpose for doing that is grabbing as many businesses, creative enterprises, ideas people and match-making them with the owners of spaces,” she said.

“We think about things in terms of vibrancy of the city, and how a tenancy can help change the cultural amenity of the city and make people feel good about the city.

“Every space is unique and there is a four-part negotiation between the owner, the property manager, the retailer or the participant, and ourselves, on how it will work.”

Ms Bain said initial expectations for Activate Perth were that it would primarily be an attractor for entrepreneurs and startup businesses, however, she said the group had gotten a much larger response from creative enterprises.

“We also got a lot of people saying they needed a space for their not-for-profit group or they needed to showcase things,” she said.

“So as much as we would love Perth to have this entrepreneurial group of people creating Silicon Valley 2.0 or whatever, it’s just not.

“I think that’s to do with the economy; people are just not willing to take a risk in the economy that we’re in now.”