AIA Australia lease 7,000 square metre St Kilda Road office
Life insurance group AIA Australia has leased about 7,000 square metres of office space on Melbourne's St Kilda Road, in one of the biggest leasing deals done in the precinct in the past year.
Under the deal, AIA Australia has agreed to a 10-year lease over levels 5, 6 and mezzanine Level 7, at 509 St Kilda Road. The lease also incorporates exclusive naming rights, main building signage rights and 85 car bays.
AIA Australia is currently located, at 553 St Kilda Rd.
The building is owned by a fund managed by Calibre Capital and the lease was negotiated by Colliers International’s Ben Christie.
“St Kilda Road still offers exceptional value in terms of the quality of building that can be obtained so close to the CBD and this made 509 St Kilda Road an excellent value proposition for AIA Australia," said Mr Christie.
As part of the lease agreement, Calibre Capital will demolish all existing fit outs in AIA’s tenancy areas and refurbish with new ceiling grid, light fittings, carpet and paint work. The lift lobbies will also be refurbished, as well as the male and female amenities.
AIA Australia joins Transfield, Fuji Xerox and Webjet in the building.
The space AIA is moving into was previously occupied by MLC, which vacated about 11,500 square metres in December.
“The 11,500 square metre vacancy at 509 St Kilda Road had the potential to create a significant spike in vacancy in the precinct, however the lease to AIA, along with previous commitments in the building to ASX-listed companies Webjet Limited (1,670 square metres ) and Transfield Services (3,378 square metres) means that figures will remain relatively stable,” Mr Christie said.
Colliers is forecasting vacancy on St Kilda Road to peak at 11.43% in July 2014, then gradually trend down.