Case Studies

Northbank Plaza – 275 George Street, Brisbane

The Challenge

275 George Street is a 40,000m² A grade office tower developed in 2008. Prior to commencement of the project, Trident Corporation were appointed to design the leasing strategy and manage the process of securing pre-commitment tenants.

Trident Corporation faced multiple challenges given that initially there were a number of competing sites suitable for office development in that precinct and more broadly across the CBD. Our challenge was to design and manage a leasing campaign that would outshine and outclass the competition and ultimately lead to securing pre-commitment tenants of adequate volume and covenant strength to be a catalyst for commencement of construction.

Trident was engaged to carry out the following;

  • Product positioning, design and pricing statement;
  • Design and implementation of leasing strategy;
  • Leasing campaign management; and
  • Strategic leasing.

Result

Telstra was secured for approximately 32,000m² as well as for a further 19,000m² in the adjoining Northbank Plaza (the largest ever private sector lease transaction in the Brisbane market).

45 Commercial Road, Newstead

The Challenge

Trident Corporation was appointed by NAB/ Ferrier Hodgson to analyse 45 Commercial Road, a 4,000m² office building that was constructed in 2007 and was still sitting vacant in 2009. The property had been through two unsuccessful leasing campaigns and two unsuccessful sale campaigns and was in the hands of a receiver and manager.

In a very soft leasing market, the receiver was faced with a decision of completing a lease that was at HOA stage over one and half floors for 5 years to a major builder at a rent of $430/m² and then leasing the balance of the premises out before an eventual sale. However, with a history of failed campaigns the receiver did not have confidence that the property was being positioned and marketed in a way to optimise value.

Result

Trident Corporation was briefed to complete a diagnostic assessment of the property and the marketing campaigns to date as well as to make recommendations as to the completion of the HOA. After completing a detailed study, Trident recommended not to proceed with the HOA as the property was (at the time) the only 5 Star Green Star design property in the inner north market that could offer above 3,000m² of contiguous space. Rather than pitching the premises for lease at a price point that was competitive for the 1,000m² market, we suggested to increase the rent to $490/m² and exclusively to larger tenants. A marketing campaign was designed around that theme and then Trident Corporation, as lease coordinator, drove the marketing campaign and actively encouraged participation from the broader agency community as well as directly canvassed tenants.

Within four months, Trident had negotiated a new lease with NYSE company Bechtel for 5 years over the entire premises at a rental of $495/m², adding around $4M in value uplift then originally thought with the path the owner and receiver were heading down.

199 Grey Street, South Brisbane

The Challenge

199 Grey Street is a ~13,000m² A grade office tower located in the heart of the South Brisbane precinct. As part of Trident’s appointment, we were engaged to handle KBR’s upcoming 8,500m² lease expiry, and whilst we successfully re-negotiated a new long-term lease, they downsized to just 2,000m². With KBR substantially retracting in size, vacancy in the building spiked to 38%. Whilst South Brisbane was still a relatively buoyant office market, the difficulty with the timing of this vacancy was that it would coincide with other full floor opportunities which were available in softer fringe precincts (i.e. Fortitude Valley) where financial terms were much more tenant friendly. What we found during this process was that tenants would try to use those precincts as leverage to negotiate better terms in South Brisbane.

The Result

Trident successfully brokered 10,500m² of new leasing transactions within the building over an 18-month campaign that achieved some of the highest face rents in the City Fringe.

Trophy transactions that occurred over that period of time included:

  • Kellog, Brown & Root (KBR) – 2,236m²
  • Minor DKL (Coffee Club) – 1,710m²
  • Flight Centre – 769m²
  • UGL Limited – 1,112m²
  • Automotive Holdings Group (AHG) – 1,114m²
  • Queensland Health – 3,500m²

Corporate Centre 2 – Corporate Court, Bundall

The Challenge

Trident Corporation was the sponsor and development manager of Corporate Centre Two (CC2), the Gold Coast’s first and only 5-Star Green Star office building. CC2 at the time was the clear market leading commercial office building on the Gold Coast which is attributed to its cutting-edge design and location in the heart of the Gold Coast’s Financial and Council precinct.

CC2 is a 4,500m² office tower that achieved practical completion in April 2009 at the top of the Gold Coast office leasing market. Vacancy rates hit close to 30% at the time and tenants on the Gold Coast quickly became very bottom line focused. CC2 entered the market at a time when it was the only premium tower for lease. The challenge we faced was pioneering premium grade demand into a market that was driven by A and B grade supply. Tenants didn’t see the value in spending the additional $150/m² on premium product at a time when economically the Gold Coast and local business was in recession.

Result

Trident researched the competition on the Gold Coast and developed a financial model that evaluated the savings on environmentally sustainable designed (ESD) building had on operating costs for a tenant. Trident used a similar study that was done by Sustainability Victoria which analysed ESD operating cost efficiencies at 300 Collins Street in Melbourne against an older building with no ESD rating. The study found that whilst rent might be more expensive in an ESD rated building the ongoing operating cost to the business was less. Rent is proportionality a smaller operating cost in most businesses compared to the largest cost which is human resource. The study analysed how staff performed better in an ESD rated buildings and found efficiencies in the amount of sick leave staff were taking. It also found that productivity increased amongst some staff. These figures were put into the financial model and expressed as savings equivalent $/m². This formed a good argument to prospective tenants that were previously of the view an older building was cheaper.

Trident presented these findings to the Gold Coast business community through presentations on-site and at events. It resulted in the largest office leasing deal on the Gold Coast to Wyndham Vacation Resorts Asia Pacific.

56 Jephson Street, Toowong

The Challenge

56 Jephson Street is an 883m² vacant two-storey office building, unoccupied since its anchor tenant left in ~August 2014. The property had been through a number of failed leasing campaigns and had received very limited enquiry, even with continual rental rate erosion.

The Result

Trident was appointed to develop a leasing and refurbishment strategy for the building. By highlighting the benefits of refurbishing the property through our financial modelling, the owner agreed to carry out a comprehensive refurbishment program which completely repositioned the property and changed the market’s perception of the building. This allowed Trident to re-engage with the market with a new product and a new story, and successfully attract both agents and tenants interest in the property.

Within two months of completion of the internal works, terms were agreed with Discount Drug Stores to lease the entire building. Discount Drug Stores are entirely owned by Sigma Pharmaceuticals who are a ASX Top 200 company. In a major coup for the building and the owner we were able to achieve a $150/m² increase in rent which we estimate would add in the order of ~$1.77M to the capital value of the asset.

TenantDiscount Drug Stores (Fully owned by parent company Signma Pharmaceuticals)
Term Five (5) years
Gross Rent $450/m²
Size883m²
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