10/08/2021 - 09:00

FMG expands office footprint

10/08/2021 - 09:00

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Fortescue Metals Group has leased more than 3,000 square metres of space at an office building close to its headquarters in East Perth.

The group has taken up space within 6 Bennett Street in East Perth. Photo: David Henry

Fortescue Metals Group has leased more than 3,000 square metres of space at an office building close to its headquarters in East Perth. 

The group secured the space within the five-storey building at 6 Bennett Street over two leasing deals, brokered by CBRE.

CBRE senior director office services Andrew Denny said the first transaction, comprising 1,681 square metres was finalised late last year.

The second deal was recently struck for a further 1,454sqm.

Mr Denny said FMG’s new space was fully fitted with a two-year old fitout, with the typical floor size of the Bennett Street building averaging 760sqm.  

This reflected the Perth office market’s recovery being underpinned by expanding tenants, driven by a buoyant mining sector.

“The Perth leasing market is the fastest recovering leasing market in the country,” Mr Denny said,

“The CBD had a positive net absorption just short of 20,000 sqm for the six months to 1 July 2021, which is around 2.5 times the long-term average.

“Project space requirements have returned to the market for the first time since 2012.

“Sub-lease availability is minimal at just 35,000 sqm - 1.9 per cent of the total CBD stock - and fell in Q2 which is the first reduction since March 2020.”

Mr Denny said past trends, such as the flight to quality and centralisation (shifting from the suburbs and city fringes into the CBD) were evident in the Perth market, which he noted was contrary to the widespread commentary on the demise of the CBD.

“Moving forward we expect the buoyant economic conditions to continue to drive positive tenant demand," he said. 

“This will enable the market to absorb the modest new supply entering the market in the next two years, with falling vacancy rates expected until 2024 when significant back fill space will enter the market.

“Early signs of some improving face rents in some select parts of the market are a further positive indicator of better conditions in the next two years.”  

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