Lendlease signs first commercial tenant for $1.9b Melbourne Quarter
Lendlease’s $1.9 billion Melbourne Quarter has signed the design and engineering group, Arup as the first tenant for the mega project opposite Southern Cross Station.
The same firm recently took up the anchor lease for Investa’s 151 Clarence Street, as its new Australian head quarters.
Melbourne Quarter will be the latest mixed use development comprising seven commercial and residential buildings, bordered by Collins and Flinders Street. The 25,000 square metres tower leased by Arup will be the first within the site which is targeting a six star green star rating.
As with all new buildings, Melbourne Quarter will offer flexible and efficient workspaces, with floor plates of about 2000 square metres and be ringed by an array of restaurants, parks and public transport in an area that is now seen as the business hub of the City.
Arup’s lease comes as agents predict incentives in rental contracts will start to tumble in Sydney and Melbourne.
Colliers International’s Melbourne-based managing director of office leasing, Simon Hunt, believes tenant demand in the Australian office market will continue to diverge between the high demand cities of Sydney and Melbourne and the lower demand environments of Brisbane, Perth and Adelaide.
“Business and, to a lesser extent, consumer confidence is rebounding in Australia, particularly since Malcolm Turnbull has injected a more positive and economically progressive leadership style in his new position as Australian Prime Minister,” Mr Hunt said.
“Tenants in the IT and Communications sector continue to drive tenant demand, particularly in Sydney, where LinkedIn, Expedia and Twitter have either taken new space or expanded their footprint. US-based WeWork, the newest player in the short-term flexible office provider market, is also believed to be close to signing their first Australian lease in the Sydney.”
Lendlease managing director, urban regeneration, Jonathan Emery said the for Melbourne Quarter is to use the scale and topography of the site and “propel its uniquely accessible and unmatched location to its rightful place in the new commercial heart of the world’s most liveable city”.
He said construction is expected to start in early 2016 and when completed will comprise 1700 apartments and the office space.
Mr Emery said the 2000 square metre ‘Melbourne Skypark’ elevated above Collins Street will be similar in size to City Square and is the most significant public space created in the city since Federation Square.
The well-known Melbourne laneway scene will also be expanded with new areas connecting Collins and Flinders streets.
Get a weekly roundup of the latest news from Commercial Real Estate, delivered straight to your inbox!
