Commercial Property Management Perth CBD

The CBD is not one market. It is several, and which street a property sits on tells you most of what you need to know about who will take it.

St Georges Terrace is the office spine and carries the bulk of the city’s office space, including the towers built through the resources boom. Hay Street and Murray Street hold most of the retail and entertainment, pedestrianised between William and Barrack Streets and linked by the arcades that run between them, with Forrest Place connecting through to the station. Elizabeth Quay brought a mixed use waterfront precinct into the south of the city, and the Perth City Link sank a section of railway to reconnect the CBD to Northbridge.

The whole area sits within the City of Perth, which means one planning authority and one set of local policies, unlike West Perth next door.

In a suburban precinct a building competes mostly on price and parking. In the CBD it competes on grade, and grade is what a tenant is really choosing between.

Premium and A grade towers set the benchmark for lift waiting times, end of trip facilities, air conditioning, security and building services. Everything below that is judged against it, which is why a well kept B grade floor with good natural light and a sensible fitout can hold a tenant that a tired one cannot, at a rent that surprises owners in both directions.

For an owner of a single floor or a strata suite this matters more than it looks. You do not control the lobby, the lifts or the end of trip facilities, but your tenant is pricing them anyway. Part of managing a CBD asset well is knowing what the building around you is doing, and pressing the strata company or building manager when it is not keeping up.

City buildings carry the most complicated outgoings of any precinct, with building services, security, cleaning, management fees and statutory charges all in the mix. Budgets are prepared before the year, billed as the leases allow and reconciled properly at the end, because this is where recovery quietly leaks.

On a strata floor the levies and by laws sit alongside the lease and both have to line up. On a whole building the capital plan is yours, and it should be forecast rather than discovered.

CBD tenants arrive and leave with fitouts, and the make good position should be clear at heads of agreement rather than argued at expiry.

A retail tenancy in an office building can fall under the Commercial Tenancy (Retail Shops) Agreements Act 1985, which changes the disclosure, the itemising of operating expenses and the tenant’s minimum term. We check whether it applies before the lease is drawn.

Leases are administered against their own dates rather than a general diary, so rent reviews, option windows and expiries are prepared for in advance rather than noticed late. In the city that lead time is worth money, because a tenant deciding where to go next starts looking well before an expiry.

Maintenance runs through contractors we use repeatedly and who know the buildings. Owners receive monthly statements and an end of financial year package prepared to the standard an accountant expects. Every property has one senior manager attached to it, and that person is who you speak to.

Where the decision is whether to hold, refurbish or sell rather than how to run the asset, our advisory service covers that on its own, with no transaction attached.

The CBD tenant base runs to professional services, legal and accounting firms, financial services, resources and energy companies and their advisers, government and agency tenants, and the serviced and flexible operators who take a floor and sublet it in pieces.

What they want differs from the city fringe. Proximity to the courts, to government and to each other counts. So does the address itself, because for a firm taking clients into a boardroom the building is part of how it presents. Parking matters less than it does in West Perth, because the station, the bus network and the free transit zone do the work instead.

Incentives move with the market and with the quality of the space. We assess what is reasonable against what is actually being agreed at the time rather than against a rule of thumb, and settle the heads of agreement properly before the lease is drawn.

A leased CBD floor is bought on its income, so the passing rent, the term left, the review mechanism and the strength of the tenant do most of the work on price, measured against yields on comparable transactions. A vacant suite is bought on what an owner occupier will pay to be at that address, which is a different pool of buyers and often a different campaign.

Buyers and their advisers will want the leases and any variations, a tenancy schedule with the expiry profile, outgoings budgets and recent reconciliations, building and fire compliance records, strata documents and the minutes behind them where the property is strata titled, and the zoning position. Having that ready before launch keeps the negotiation on price rather than on paperwork.