As commercial vacancies remain at record lows across Perth’s CBD, property owners are undertaking major refurbishments to utilise what little space remains.
As commercial vacancies remain at record lows across Perth’s CBD, property owners are undertaking major refurbishments to utilise what little space remains.
JJ Leach Group’s refurbishment of its six storey building at 110 William St, opposite the new train station on the corner of Murray Street Mall, has attracted Rio Tinto’s subsidiary Pilbara Iron.
The company has taken out levels two, four and five of the building, with a total area of about 934 square metres.
A refurbishment of these three floors – which included stripping back floors, installing new air-conditioning and removing ceilings – was completed prior to Christmas.
One of the most expensive elements of the project was the installation of a stainless steel woven mesh façade on the outside of the building, covering more than 300sqm.
The material, which costs $1,000/sqm, has not been used in WA previously, according to JJ Leach.
The three floors leased by Pilbara Iron were advertised on a gross rental basis of $480/sqm and were previously vacant.
The miner will share the building with existing tenants on floors one and three.
The William St project follows Australasian Property Investments’ staged refurbishment of 713 Hay Street, otherwise known as Sheffield House, which reached practical completion in November.
The owners spent $6 million refurbishing about 2,000sqm of office space over three storeys.
Of the building’s 3,200sqm of net lettable space, which includes a ground floor retail area, only 400sqm of office space on the first level remains available for lease. The asking price for the space is $400/sqm.
Development approval for a 20-bay car park in the building’s basement, occupied by tenant JB HiFi, has been granted by the City of Perth, although a timeframe for the project is yet to be finalised.
Architects Cameron Chisholm & Nicol have occupied the top floor and are planning to apply for an Australian Building Greenhouse Rating for their internal fit-out.
Refurbishment projects at several other CBD sites are due for completion over the next few months, yet the lettable space has already been snapped up by tenants.
External work on the former Home building at 184 Adelaide Terrace in nearing completion, with the building having been leased to the WA Police.
Meanwhile, Primepoint Asset’s $17 million refurbishment of the former Royal and Sun Alliance Building at 41-43 St Georges Terrace is two to three months away from completion.
The eight-storey building, which includes a basement, has a net lettable area of 2800sqm and has been fully leased since November.
Further down the terrace, the refurbishment of the former Alexander Centre at number 99 is nearly complete, although further work is required on the basement and lobby.
The refurbishment of the building, which is fully leased except for one 406sqm floor, was initially expected to be completed in September last year.
According to Colliers International director of office leasing, Ian Campbell, tenants who signed on early had secured a good deal.
“Since we started taking this to the market, rents have jumped by $120/sqm over five months. Those tenants who got in early got a good deal,” he said.
Mr Campbell said further major refurbishments were unlikely this year. “99 St Georges Terrace and the Wesley Centre were all vacant so the owners were able to get in and do refurbishments,” he said.
“There are some owners looking to do upgrades because they’ve got the capital to do so, but the opportunities to do major work are limited.”
“Owners are going to continue to see very strong rental growth over the next 12 months, and it’s an operational issue to get in and do refurbishments. It will be determined by each property’s lease profile.”
