Commercial Property Management Subiaco

Subiaco is a main street economy. The commercial activity runs along Rokeby Road and Hay Street in a continuous strip of shopfronts with offices and consulting rooms above them, rather than concentrating in a single building or centre. That shape is what gives the precinct its character and it is also what makes each individual holding quite specific.

The stock is largely older, and much of it is fine grained: narrow frontages, one or two levels, rear or shared parking, and a good deal of it adapted over time from its original use. Subiaco station sits in the precinct and the suburb falls within the City of Subiaco, which has its own planning scheme and local policies.

The Subiaco East redevelopment, led by DevelopmentWA, covers Subiaco Oval, Kitchener Park, Mueller Park and the former Princess Margaret Hospital site, and has already brought Bob Hawke College into the area. A redevelopment of that scale changes the catchment over time, which is worth factoring into a lease term rather than treating as background noise.

Rokeby Road is recorded as a heritage precinct on the State Heritage Office’s inHerit database, and heritage listing of one kind or another touches a large share of the older commercial stock in Subiaco.

What that means in practice is not that nothing can change. It means the path to change runs through an approval, and the approval takes time and shapes the outcome. Signage, shopfront alterations, awnings, painting, external plant and anything affecting the facade can all need consent. A tenant who signs a lease expecting to reface the shopfront in a fortnight, and an owner who agreed to it, are both about to have a difficult conversation.

We establish the heritage position on a property before it is marketed, not after an offer, so the lease terms and the fitout expectations are set against what can actually be approved. Where a listing exists it is also a selling point, because the character of the strip is precisely why a certain kind of tenant wants to be on it.

A great many Subiaco tenancies are shops of 1,000 square metres or less, which brings the Commercial Tenancy (Retail Shops) Agreements Act 1985 into play, with its disclosure statement, tenant guide, operating expenses budget seven days before the lease, itemised outgoings and minimum term. This is the single most common thing to get wrong here.

Established before marketing, not after an offer, so what a tenant can do to the premises is known.

Bays are limited on a main street and often shared, at the rear or licensed rather than on title. What exists needs to be established properly, because it shapes which tenants are viable.

An office or consulting suite above a shop is a different letting proposition from the shop below it, with its own access, services and tenant pool. The two should be marketed separately rather than as one lot.

Food and beverage tenancies bring grease traps, extraction, acoustic conditions and trading hours into the lease, and they need to be written in rather than assumed.

Leases are administered against their own dates, so rent reviews, option windows and expiries are prepared for in advance. On a retail lease covered by the Act, the landlord must also give the tenant notice six to twelve months before an option has to be exercised, and that notice is diarised rather than remembered.

Outgoings are budgeted before each year, billed as the leases allow and reconciled at year end. Where the Act applies, the operating expenses have to be itemised in the lease and the tenant can ask to see the invoices behind them, so the records are kept to that standard from the start.

Maintenance runs through contractors who know older buildings, which matters more here than in newer stock. Owners receive monthly statements and an end of financial year package. Every property has one senior manager attached to it.

Where the question is whether to hold, refurbish or sell rather than how to run the asset, our advisory service covers that separately.

Subiaco draws tenants who want a street presence rather than a lobby. Independent retail, hospitality, allied health and medical consulting, beauty and wellness, design and creative studios, and small professional firms who prefer a character office above a shop to a floor in a tower.

Those tenants are choosing the street as much as the premises, which cuts both ways. It means foot traffic, parking and the mix of neighbours matter to them, and it means a vacancy is easier to fill when the strip around it is trading well. A campaign here is about the position and the passing trade, not the floor area.

Incentives and fitout contributions move with the market and with the quality of the tenancy. We assess what is reasonable against what is actually being agreed at the time, and settle the heads of agreement before the lease is drawn.

Subiaco buildings attract two quite different buyers. One is an investor buying the income, who will price the passing rent, the lease terms and the tenant against yields on comparable transactions. The other is an owner occupier or an operator who wants that address for their own business, and who will pay for position rather than yield.

Knowing which pool a property suits before launch decides the method and the marketing. Whichever it is, the buyer will want the leases and variations, the outgoings history, the heritage position and any approvals, building compliance records, the parking arrangement documented properly, and the zoning. On a strip like this the parking and the heritage position are the two that most often hold a contract up, so they are worth resolving before going to market.