Investa Commercial Property Fund (ICPF) and the co-owner Gwynvill Group have completed a $1 billion skyscraper at 60 Martin Place, a plaza that is considered the spine of the city’s core precinct.
Designed by leading international design practice Hassell and constructed by Lendlease, the 33-level tower is the only premium grade Sydney CBD office development to be finished in 2019.
The tower has a dramatic and unique cantilever design, with the northern facade extending eight metres above the neighbouring St Stephens Church.
ICPF’s group executive & head of commercial development Mark Tait said the property – known as Sixty Martin Place – is 80 per cent leased, with the remaining 20 per cent in the final stages of negotiation.
The major tenants are Norton Rose Fulbright, Mizuho Financial Group, Munich Re, Banco Chambers and international workplace group’s Spaces brand, with the latest signings coming from legal and infrastructure investment management firms Thomson Geer and HRL Morrison.
In addition, office workers will be able to eat at the new Toppi Martin Place, run by Bar M’s Paola Toppi on the Macquarie Street and Martin Place corner, while 60 Buvette, a European-inspired cafe will open in the lobby in November.
Group executive property at Investa, Michael Cook said the group’s aim at contributing to the City of Sydney Council’s Sustainable Sydney 2030 vision, and “helping to revitalise Martin Place as a key financial and economic hub has been achieved”.
“Demand for space has been outstanding with strong rents achieved. We anticipate the building will be 100 per cent committed by the end of the year,” Mr Cook said.
It comes as the Sydney and Melbourne office leasing markets are at near 10-year lows with demand coming from tech groups, co-working operators as well as the traditional legal, insurance and finance sectors.
Investa’s head of research and strategy David Cannington said while there is some softening in demand on the horizon, he expects that “Sydney and Melbourne will stay low and high-quality prime office space will remain the preferred option of CBD office market tenants”.
He said in Sydney, ICPF has signed leases at Deutsche Bank Place, 126 Phillip Street, with the bank renewing its contract.
In Melbourne, ICPF finalised more than 9600 square metres of leasing, with 120 Collins Street the stand-out with 19 leases transacted.
Mark Rasmussen, joint head of division for office leasing in Victoria for Savills Australia, said while there are 11 new buildings coming into the market, it will not “blow out vacancy rates too much”.
“Rents in Melbourne have risen about by 20 per cent in the past 18 months with premium-grade buildings now at between $600 to $900 per square metre,” Mr Rasmussen said.
“While we will be surprised to see vacancy rates above 3 per cent in the next Property Council of Australia’s survey, with the new supply it could rise to the high 6 per cent or low 7 per cent level, but not much higher.”
Of the recent lease deals in Melbourne, CSL has taken out 35,000 square metres at 621 Elizabeth Street, the Australian Federal Police will move to 140 Lonsdale Street, and Australian Super has inked a deal at 130 Lonsdale Street.
The tech hub at Cremorne will see Afterpay join MYOB and Seek, while the ANZ Bank has renewed its lease at 75 Dorcas Street, South Melbourne for a rent of about $450 square metre net and a 25 per cent incentive deal.
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