Axiom higher on $14m lease deal

Shares in Perth-based developer Axiom Properties have surged higher today after it secured a government entity as a tenant for a Melbourne property, which is expected to generate $14 million.

Axiom, together with its joint venture partner Industry Superannuation Property Trust, today announced the Australian Bureau of Statistics had agreed to lease the entire office building on Spencer Street, starting in July next year.

Under the agreement, the ABS occupy the 14,500 square metres of office space once Fairfax Media leaves.

The new agreement will see the ABS lease the building for two-and-a-half years until December 2013. Axiom said the total value of the lease over the period is about $14 million.

Lease negotiations were conducted by the partners and Jones Lang LaSalle.

"This is another example of the take-up of the backfill space created by the relocation of businesses into new projects in the Melbourne CBD, which will limit the increase in vacancy rates that was initially anticipated in the Melbourne market," Jones Lang LaSalle director David Bowden said.

The new deal follows last month's sale of the residential component of the Lonsdale Street site for $17 million. Axiom owns 50 per cent of the property.

Shares in Axiom closed up 0.7 cents, or 19 per cent, to 4.4c today.