Growthpoint Properties Australia has defied softening office leasing conditions and secured hardware retailer Bunnings as the anchor tenant of its Richmond office building in Melbourne’s city-fringe.
In one of Melbourne’s largest recent office-leasing deals this year, Bunnings will take almost 13,900sq m of the 19,500sq m in Growthpoint’s Botanicca 3 building that was completed in February.
The five hectare Gray Puksand-designed estate, located within five kilometres from Melbourne’s CBD, comprises two towers of five and six levels at 570 Swan Street.
It is nestled close to the Yarra River and is close to a busy cycling path, three railway stations, a tram route and the M1 freeway entrance.
The building, which sits on a 8,600sq m site, is 5 star Green Star rated and expected to achieve 5 star NABERS Energy and Water ratings when fully let.
The lease, for 10 years and seven months, will extend the group's pro-forma portfolio weighted average lease expiry to 6.5 years and raise Growthpoint’s occupancy across its portfolio of 57 properties to 96 per cent.
The business park is already home to David Jones and Country Road, in Buildings 1 and 2, after Growthpoint struck a deal with parent company Woolworths Holdings Limited for 23,000sq m of office space.
The deal, which overseen by Colliers and JLL, saw David Jones and Country Road relocate its headquarters from Sydney to Melbourne.
Other tenants include Harris Scarfe, Mimco, Forever New and Witchery as well as GE, Fulton Hogan, Wells Fargo and Golder Associates.
“We are pleased to have agreed a long lease with Bunnings particularly during these uncertain times, highlighting our ability to achieve leasing success in a challenging environment,” Growthpoint managing director Timothy Collyer said.
“Securing a pre-eminent tenant is a significant milestone for the development and confirms our view that Botanicca 3 is one of the highest-quality metropolitan offices in Australia.”
The lease will enable Bunnings to consolidate its local and national store support teams currently accommodated across six Melbourne offices into the one location, set to act as its Victorian headquarters.
“Botanicca 3 will allow us to bring together support teams currently located across six Melbourne offices into a single home in a central location, providing everyone with a modern workspace,” Bunnings property director Andrew Marks said.
The lease commenced this month, but Bunnings said it would likely relocate from mid-2021 following design consultation with health and spatial experts.
“We want to create a working environment that is safe, makes collaboration easy and allows our team to seamlessly transition between home and office work,” Marks said.
The hardware retailer also has the option to surrender up to 4,200sq m before the completion of the fit-out.
Growthpoint, which is controlled by Johannesburg-listed Growthpoint Properties, holds a portfolio of east coast metropolitan offices and warehouses primarily leased to logistics firms.
Late last year, Growthpoint landed one of the biggest office-leasing deals of the year, with the NSW Police securing 32,356sq m at 1 Charles Street in Parramatta for 25 years.