by Lynne Blundell

Stockland’s 6 star 2 Victoria Avenue, Perth: “It is more important than ever for us, as a landlord, to future-proof our portfolio”

In a deal it is hailing as evidence of its leasing expertise in a tough market, Stockland has signed up Shell Development Australia as the major tenant in its new sustainable office building in Perth ahead of building completion.

The building, 2 Victoria Avenue, is Perth’s first to be awarded 6 Star Green Star Office Design v2 rating.

Shell Development Australia, currently located in Perth’s QB1 building at 250 St Georges Terrace, will rent two thirds of the building, or 5500 square metres for eight years.

Stockland Commercial Property CEO John Schroder said: “We are pleased to confirm our long-term partnership with Shell.

“This is another example of our commitment to attracting blue-chip tenants via our continued focus on active management and sustainable design.”

But how prominent is the sustainability factor in the current tough economic climate?

A company spokesperson for Stockland said it was increasingly difficult to attract tenants in the present market:

“We are seeing leasing incentives increasing in the current environment. A lot of tenants are staying put as the cost of moving is prohibitive.

“We cannot speak on Shell’s behalf, however we are seeing that many organisations, particularly Federal Government tenants and blue-chip companies, are considering the sustainability of the space they lease,” the spokesperson said.

“It is more important than ever for us, as a landlord, to future-proof our portfolio and ensure that we can still attract blue-chip companies in today’s challenging market. The Shell lease agreement is an example of this.”

Agent for the QB1 building, Paul Teraci of CBRE Perth’s office, told TFE that Shell has a long lease at QB1 and is making the move before the end of its lease because of a need for a larger area of contiguous space.

“I know it wasn’t the six star rating that was the main reason for the move – we just don’t have the amount of contiguous space they need at QB1.” Teraci said.

“We’re not overly concerned because Shell has a long lease in place and may even choose to keep their space here.”

According to Teraci, sustainable retrofits of older buildings in Perth is driven by building owners rather than tenants. Tenants who are interested in green initiatives when signing a lease commonly ask about the NABERS rating.

“NABERS shows the real energy usage and can be adjusted more easily but tenants do want to know where you’re heading with Green Star,” Teraci said.

The 20 year old QB1, jointly owned by Investa and Dexus, has a 4.5 NABERS energy rating and is about to have a light-load air conditioning system installed – a $600,000 investment.

Shell’s new headquarters at 2 Victoria Ave was designed by Woodhead Architects with Bassett Consulting Engineers and building by Diploma.

Sustainability features include:
•    three rooftop wind turbines which provide energy to a portion of the building
•    automated louvres on the western façade which respond to the sun to maintain views and natural lighting
•    active chilled beam system for air conditioning
•    grey water recycling for toilet flushing
•    extensive water and energy sub-metering to monitor usage.

The building is due for completion later in April. A tenant is yet to be signed for the remaining third of the space.