New tenants take up office space left vacant by Shell Australia
A leasing rebound is underway at 256 Adelaide Terrace, where agents from Colliers International and Savills have brokered office leases to 10 new tenants in the past year.
Like much of Perth’s B-grade sector, 256 Adelaide Terrace confronted high vacancies in the market shake-up that followed the supply of new buildings and lower demand for office space from the resources industry.
The new leases were signed by legal, IT and engineering businesses and have halved the building’s vacancy.
“Competition from newer buildings in Perth’s office market created a challenging leasing environment for many Perth office buildings but with upgrades, fitouts and keenly-priced lease terms, 256 Adelaide Terrace is reclaiming its occupancy,” said Colliers International’s Daniel Taylor.
The office tower was left with a seven-floor vacancy in 2016, mostly due to the move by Shell Australia to its new building at Kings Square.
“The Shell fitout was of a high quality and we’ve managed to lease the majority of this space, with only 450sqm remaining,” Savills’ James Phelan said.
The 10 new leases account for 4,222.5sqm in the 17-storey office tower, which is located on the corner of Victoria Avenue and has Swan River views from its upper floors.
“These leasing recoveries don’t happen overnight but by offering a range of leasing options including brand new fitouts and good-quality second-hand fitouts, tenants have seen value in the building and have gradually moved in,” Colliers International’s Dustin May said.
The building’s lobby has been restored and ongoing upgrades are being carried out on wet areas and on-floor foyers. Construction has started on new end-of-trip facilities, which will be installed before June.
The new tenants include law firms, Stork Davies Legal Advisors, Cove Legal and JDK Legal Services; IT services firm ESN Group; cloud storage business Tape Ark; power, electrical and network infrastructure manufacturer Panduit; and engineering firm Minnovo, which signed a five-year lease for more than 2000sqm in December and has taken signage rights over the building.