Five Reasons to Rent Office Space in the Melbourne CBD
Melbourne is often labelled the cultural centre of Australia, with good reason. The city hums with creative and commercial energy. Anyone who has spent time wandering Melbourne’s laneways knows the feeling of exploration. The cultural excellence of the city spills into design, architecture, cuisine and fashion. The whole city is elevated by these pursuits and Melbourne is a highly desirable destination for office space.
From a commercial real estate perspective the Melbourne CBD consists of four well-defined precincts. Melbourne’s city blocks, otherwise known as the Hoddle Grid, are split into two precincts; the Eastern CBD and the Western CBD. Across the Yarra River are the up and coming urban renewal precincts Southbank and Docklands.
Melbourne city is experiencing something of a renaissance with tenants flocking to rent office space in the CBD and fringe areas. The current commercial real estate market dynamic is favourable towards tenants, making it easier for astute businesses to gain a foothold in this thriving cosmopolitan hub.
Here are five reasons tenants are coming to the Melbourne CBD in droves;
1. High quality stock – The Melbourne CBD is emerging from a construction boom with much of the action taking place in Docklands. Consequently a smorgasbord of brand new A –grade property has entered the market over the past few years. This is particularly true of the Docklands area where the prevailing campus style development appeals to businesses looking for larger floor plates at competitive rental rates.
2. High incentive environment – Given the glut of supply and generally subdued economic conditions post the GFC, competition between Melbourne land lords is intense. At the moment renting office space in the Melbourne CBD and fringe comes with historically high incentives. Despite overall vacancies declining over the past year, according to Knight Frank incentives remain within the 28%-32% range. With such great deals on offer it is little wonder that tenants are stampeding in.
3. A place to live and work – Melbourne has recently overtaken Perth as Australia’s highest growth city on the back of increased interstate migration. People are attracted by Melbourne’s laid back yet cultured lifestyle, its efficient public transport and its relatively affordable property.
The Melbourne CBD and fringe has undergone a residential construction boom – particularly in Southbank and Docklands which have been developed as mixed use precincts. The residential population of Docklands is set to skyrocket to 16,000 over the next 15 years and the southern hemisphere’s tallest residential tower is planned for Southbank. St Kilda Road too is seeing a wave of residential conversion.
The upshot is that Melbourne’s CBD and inner fringe is place where upwardly mobile people want to be. Renting an office in the Melbourne CBD means a huge reservoir of skilled employees is right at your doorstep.
4. Transport – Melbourne is frequently lauded as one the world’s most liveable cities and this has much do with how easy it is to navigate. The CBD is the focal point of an excellent rail and tram network bringing workers in from all over greater Melbourne. Similarly the road system is well laid out and less congested than Sydney. Melbourne’s world class infrastructure is a big factor in its desirability as a location to rent an office.
5. Vibrant culture – Melbourne is internationally renowned for its sparkling dining, entertainment and arts scene, not to mention the shopping. The CBD is a hot spot for small bars and the city swings seven nights a week. The food and coffee culture is viewed as a national treasure. Melbourne boasts three hat establishments Flower Drum and Vue de Monde as well Heston Blumenthal’s new venture in Crown Casino. Fashionistas adore the city’s flagship department stores and the edgy up and coming designers that congregate in the famous arcades and laneways.
Leasing office space in Melbourne’s CBD puts your business within a stone’s throw of lifestyle facilities that are the envy of the world. With Melbourne’s A-grade property commercial property filling up rapidly, the high incentive environment is not expected to last. Now is the time to jump in.
Image credit: "Melbourne" by Yasser Alghofily via Creative Commons