Fund manager Primewest has signed up three new tenants for over 11,000 square metres of office space at Quadrant in Perth, bringing the once near-empty tower to near-full occupation.
This means however other spaces in Perth will be vacant as the new tenants have left existing office locations on the city fringe and within the CBD.
The three tenants, Technip FMC, Department of Jobs, Tourism, Science and Innovation and Jadestone Energy, were also offered market incentives but Primewest did not reveal how much.
Primewest bought the A-grade tower at 1 William Street in Perth’s CBD a year ago for $175 million. At the time only two thirds of the property was leased.
Much of the vacancy had been around for five years as the city struggled against the mining downturn.
Following the acquisition of the tower, Primewest embarked on an aggressive leasing campaign which has left behind only about 1,500 square metres of vacant space across three 500 sq m suites in the tower.
Primewest Director John Bond said the exercise was part of Primewest’s counter-cyclical investment strategy.
“Perth is back, with positive signs now emerging in the Perth property market and the CBD vacancy rate falling,” Mr Bond said.
“Rents rose 0.4 per cent in the fourth quarter of 2018 and Premium Grade vacancy is now below five percent.”
“A Grade is also continuing to fall and there is a decline in B grade space available for the first time in this cycle, which is a further sign of improvement”
Primewest also refurbished the lobby at the Quadrant as part of the leasing strategy. The Quadrant is a 21-level tower with views of the Swan River.
The campaign for Quadrant was similar to the one Primewest and joint venture partner AMP Capital used at another Perth building, the Exchange Tower, where the vacancy level has dropped to 13 per cent from 38 per cent.