Office

<html><body>
GUEST OBSERVER
A pop-up tree office in London is the latest expression of a growing movement to take work out of the office into the landscape of the city.
Designed as an installation for the recent London Festival of Architecture, the tree-house coworking space is equipped with power and wi-fi and will be available to hire for several months.
The project is part of the Park Hack project led by Hackney Council. Profits from the space will be reinvested into parks and green spaces in the area.
The tree office workspace continues the appetite for the pop-up urbanism movement. The pop-ups are temporary installations and cover a broad spectrum including art, retail, food and craft. They are intended to highlight alternative perspectives, gather feedback in real time and test potential urban design improvements.
The trend to get out of the office is not new, however projects such as the treehouse workspace highlight a renewed focus on making working outdoors practical.
Since Ray Oldenburg officially coined the term “third place” in 1989, our drive to find accessible, social, technologically enabled and welcoming places to work within the urban environment continues unabated.
Despite advances in technology and evidence of the benefits of nature on our thinking and well-being, the reality of working outdoors has not been without challenges.
A groundbreaking project in New York City in 1989 was one of the first to formally experiment with ways to activate multiple urban public spaces as worksites. The project called Breakout! aimed to draw on the platforms of mobile technology and location-aware social networks to support cross-organisational and interdisciplinary collaborations. Despite the technology underpinning, a key aim of the project was to increase serendipity and face-to-face connection.
The experiment highlighted the challenges of working outdoors, with issues such as access to power in public space and unsuitable furniture limiting the outcomes. Fast forward to 2015, and an increasing number of urban planners and furniture designers are making the outdoor workspace a design priority.
The benefits of working in natural environments are the focus of a growing body of empirical research. A recent study on the use of plants in offices found a 15% increase in productivity when plants were added to lean office spaces. Employees also reported improvements in air-quality, satisfaction and concentration.
Far removed from the days of the half-dead dusty fern adorning a forgotten corner of the office, organisations are embracing the biophilia hypothesis with gusto. The Selgas-Cano office in Madrid is built nestled into the ground. Google’s proposed new biodome in Mountain View and the new Ecole Polytechnique at the Paris-Saclay University are designed to embed the office space right into nature.
However, the time when we will be able to work effectively in the actual outdoors may not to be too far off. Designers such as Jonathan Olivares and Buzzispace creating prototype outdoor working solutions that include a range of ergonomic, sheltered, powered and customisable furniture arrangements.
Libby Sander is PhD candidate, Griffith University and author for The Conversation and can be contacted <a href="https://theconversation.com/profiles/libby-sander-143232" target="_blank">here</a>.
</body></html>

jchancellor-FAypfDUnLy

The growing movement to take work outdoors

<html><body>
Small and medium-sized enterprise (SME) owners are examining alternative ways to acquire and gear their business premises in the event that the government bars self-managed super funds from directly borrowing to invest using increasingly-popular limited recourse borrowing arrangements (LRBAs).
These SME owners are responding to a recommendation in the <a href="https://fsi.gov.au/publications/final-report/" target="_blank">final report</a> of the Financial System Inquiry, chaired by David Murray, that this form of borrowing be prospectively barred. There is speculation that the borrowing rules for SMSFs could significantly change in the months leading to the May budget.
Since September 2007, super funds have been permitted to borrow to invest – as an exemption to the general bar on borrowing – using limited recourse borrowing arrangements. The geared asset must be held in a holding trust until the loan is repaid and creditors cannot make claims against a super fund’s assets other than the geared asset.
SME owners are believed to be among the biggest, if not the biggest, users of limited recourse borrowing arrangements to gear investments – typically to their own business premises – through their SMSFs.
Significantly, business property is one the few types of assets that SMSFs are allowed to acquire from their members and other related parties. As well, business property is one of the few types of assets that funds can lease to related parties, including the members’ businesses, without being limited by the in-house asset rules in superannuation law.
In her latest newsletter, Meg Heffron, co-principal of SMSF administration group Heffron, asks a telling question for SME owners wanting to buy their business premises through their SMSFs: Does the possible demise of limited recourse loan arrangements “represent the end of the world as we know it” for SMSFs to acquire property if they don’t already have the cash?
It seems the answer is a resounding “no”, according to Heffron and Chris Malkin, senior consultant auditor with Baumgartner Superannuation.
Heffron and Malkin says the strategy that SME owners are likely to most use if limited recourse loan arrangements are barred is to arrange for their SMSFs to progressively buy their business premises through ungeared trusts or companies.
“I think ungeared trusts are much underutilised,” says Heffron, “probably because they are poorly understood.”
A typical strategy would involve the members of an SMSF and the SMSF itself owning units in the ungeared trust which acquires the business premises. And then the SMSF progressively acquires more units to eventually gain full ownership. Although the trust is ungeared, the law does not prohibit SMSF members from personal borrowing to acquire units in the trust.
Factors to think about when considering an ungeared trust as an alternative to a limited recourse borrowing arrangement include:
1. Security for the loan
With limited recourse loan arrangements, the geared business premises (or whatever other asset is being acquired) provide security for the loan whereas with a typical ungeared trust arrangement, SMSF members often borrow against the equity in their homes.
2. What’s at stake if the investment fails
This is, of course, linked to point one above. On the face of it with limited recourse loan arrangements, the geared business premises would be at risk if the investment did not succeed. Whereas with the typical ungeared trust arrangement, fund members would have borrowed against the family home and therefore the family home would be at stake. In practice, however, the contrast is not so clear cut.
Malkin emphasises that although with limited recourse loan arrangements, a financier can only make a claim against the geared asset, SMSFs often use almost all of their assets to pay the deposit or initial instalments on the investment. And lenders often require SMSF members to provide a personal guarantee, which typically means that their homes may also be at risk.
“Speaking as an owner of an SME, I usually try to divorce my personal assets from what I do with the business,” Heffron comments. “If I borrow to buy the business premises, I would like to have the loan secured on the business premises – not secured on my personal assets.”
3. Intended improvements to business premises
Under existing law, SMSFs using a limited recourse loan arrangement can only drawdown on the loan to make repairs not improvements to a geared property. (This applies to arrangements entered into after July 7, 2010.)
Heffron says that this bar on using borrowed money borrowed under limited recourse loan arrangements may make ungeared trusts more appropriate for an SME wanting to acquire business premises through their SMSFs and then to make significant improvements. Much depends on the circumstances, including professional advice received.
“The super fund or the family trust can buy more units in the ungeared trust,” says Heffron, “and that will provide the money to make improvements.”
4. Simplicity of strategies
Opinions differ among superannuation specialists about which strategy is simpler – limited recourse loan arrangements or ungeared trusts. Again much will depend on the circumstances.
Heffron believes that the limited recourse loan arrangement is generally simpler if the super fund does not intend to make improvements to the property and wants to simply rent it to the members’ business. This is partly because the geared asset is held in a holding trust until the SMSF makes the final instalments on the loan. There is no CGT event or transaction whenever the super fund makes loan instalments.
By contrast, Heffron says there is a CGT event with the ungeared trust strategy whenever the super fund acquires more units. Also Heffron warns in her newsletter that an ungeared trust is “permanently comprised” and loses its concessional treatment if it breaches the “fairly stringent” rules after a super fund invests in it.
5. Gearing tax benefits
From this perspective, the ungeared trust strategy would typically be the clear winner.
As Malkin explains, an SMSF member personally borrowing to buy units in the ungeared trust acquiring the business premises would be entitled to claim tax deductions for interest payments at his or her marginal tax rate. By contrast, an SMSF borrowing under a limited recourse loan arrangement would only be entitled to tax deductions at the standard superannuation tax rate of 15%.
This article first appeared on <a href="https://www.smartcompany.com.au/" target="_blank">SmartCompany</a>.
</body></html>

mlaurence-vhAHaLZT8y

SMSFs and geared business premises: Five factors to consider

<html><body><div class="page" title="Page 1">
<div class="section">
<div class="layoutArea">
<div class="column">
The Tigers’ roar continues to reach throughout their home suburb, with reigning premiers the Richmond Football Club taking up a Swan Street office for its expanding sports science training program.
</div>
</div>
<div class="layoutArea">
<div class="column">
Fitzroys agent Ervin Niyaz negotiated the 3+3-year deal for the 130 sqm space on <a href="https://www.realcommercial.com.au/property-offices-vic-richmond-502373226" target="_blank">Level 1, 226 Swan Street</a> at $35,000 per annum, or $269 per sqm, on behalf of a private landlord.
The space is positioned above Spud Bar and Urban Man on the popular city fringe strip that has emerged as one of Melbourne’s most popular lifestyle and hospitality precinct.
“Office tenants continue to be drawn to the Richmond area given Swan Street expanding its offering of eateries, bars and nightlife venues, the large volume of residential and office development nearby, its convenient transport options and inner-city location, and proximity to Melbourne’s sports and events precinct that includes the MCG, AAMI Park and Rod Laver Arena,” Niyaz said.
He said the club needed extra space for the program in addition to an existing office nearby on Swan Street and its nearby home facilities at Punt Road Oval.
</div>
</div>
</div>
</div></body></html>

j.ballantyne1990-6AQqhLzZaK

Tigers' roar spreads through Richmond

<html><body>
The US consulate general Sydney will move to North Sydney after 25 years at the MLC Centre headquarters in Sydney's Martin Place.
It has secured a lease at the A-grade office tower 50 Miller Street.
The United States of America has leased 6000 square metres of office space across levels five to 10 at the 10-storey tower.   
Cadigal's Craig Dolman negotiated the new 12-year lease with options, one of the biggest leases in North Sydney.
Sumner Capital and Prime Super have refurbished the property since their purchase in 2014.
North Sydney will have its own new metro station.
</body></html>

US Consulate off to North Sydney

<html><body>
Cushman &amp; Wakefield and Knight Frank have been jointly appointed by various strata owners to sell the majority of strata lots within 70 Pitt Street, Sydney. 
70 Pitt Street will be presented to the market through the sale of 23 lots, equating to approximately 85% strata interest in the commercial office tower by unit entitlement and total lots.
The site holds significant redevelopment potential under current planning controls and its location, on the southern edge of one of the four identified tower clusters, is expected to benefit from amendments in density and maximum heights under the Sydney Local Environmental Plan (LEP).
The 16 storey commercial office tower was originally constructed in 1963 and was strata subdivided in 2003. The building comprises two levels of sub-ground accommodation, ground and basement level retail totalling 959 square metres, and 4,931 square metres of office accommodation over 13 levels.
The property, holding 26 lots in total, benefits from flexible floorplates as 10 of the office levels are full floor lots, ranging between 348 to 462 square metres, whilst the remaining three levels have been further subdivided into smaller suites ranging in area from 41 to 108 square metres.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/10/16/70%20Pitt%20Street%202.jpg" alt="">
Cushman &amp; Wakefield’s Associate Director of Capital Markets, Brad Hamilton and Director of Sales and Investments, Ryan Cross are jointly managing the sale with Knight Frank’s Director of Commercial Sales Jonathan Vaughan, Head of Commercial Sales NSW John Bowie-Wilson and Head of Asian Markets Dominic Ong, via an international expressions of interest campaign.
"The sale of the available lots at 70 Pitt Street are expected to generate strong interest from local and global investors seeking to acquire an underdeveloped asset in the heart of Sydney’s financial core," Hamilton said. 
"The 85% interest (both lots and unit entitlement) provides the purchaser ordinary and special resolution voting rights which creates the potential to unlock value add opportunities.
"The Sydney CBD continues to gain appeal as a global destination and will further benefit from the NSW Government’s planned $50 billion investment into Sydney’s infrastructure and transport revolution, including; Sydney Metro, Sydney Light Rail and major upgrades to Circular Quay Ferry Terminal."
Vaughan said: "The opportunity to acquire office assets in the financial core for less than $100 million is extremely rare. With the vacancy rate in the Sydney CBD the lowest it has been in years at 4.6% and B grade office buildings outperforming the broader market in terms of rental growth, 70 Pitt Street’s low rental base and favourable lease expiry profile will provide excellent growth via staggered exposure to the leasing market."
The Owners’ Representative, Chris Spanos added: "The owners participating in this collective sale have taken over 6 months to prepare in order to ensure we are bringing the best possible product to market. We have entered a deed binding ourselves to the process before marketing, so that prospective purchasers have certainty when assessing this opportunity. We could not be more excited to be bringing 70 Pitt Street to market."
</body></html>

Strata owners come together to sell Pitt Street office tower

<html><body>
An 88 sqm office suite located within the Sydney CBD has been sold.
It was offered by Yosh Mendis for Cushman &amp; Wakefield Sydney. 
The office situated at <a href="https://www.commercialrealestate.com.au/property/302-67-castlereagh-sydney-nsw-2000-2014581145" target="_blank">302/67 Castlereagh Street</a> features high ceilings, the abundance of natural light, and back-to-base security system.
It is surrounded by occupiers including Dior, Chanel, Bvlgari and Prada.
It is within walking distance to MLC Centre, Law Courts, Martin Palace, Hyde Park, Wynyard, Sydney Towner, Westfield and Pitt Street Mall.
This boutique strata office was offered for the first time in 40 years. 
 
 
</body></html>

Sydney CBD strata office sold after four decades

<html><body>
Smaller office tenants continue to choose to owner occupy rather than lease, says a Fitzroys agent.
Fitzroys agent Stephen Land negotiated the sale of Suite 302, 434 St Kilda Road for $320,000 plus GST.
The 105 square metre suite occupies a corner suite and includes one car park.
He said the office was presented to the market for sale and for lease, with the majority of enquiry came from prospective purchasers,
He said this was indicative of ongoing interest from small tenants wanting to owner occupy ahead of leasing.
“The purchaser plans to occupy the suite after their search for a space within a central location on Melbourne’s city fringe and convenient price point,” Land said.
“The on-title parking space was also an attraction, with most interest buyers requiring at least one parking space.”
Land said CBD strata prices have soared since 2014, and that while the growth has slowed recently, those gains have still priced out a number of potential owner occupiers from the city.
“There is future upside on the rental, with the new Metro train station currently under construction nearby at Domain interchange set to boost connectivity to the boulevard, while the limited number of available small suites in the area continue to shrink as office stock is taken off the market for conversion,” he said.
Land negotiated the sale on behalf of the former owner occupier.
</body></html>

Small office tenants choosing to own over leasing

<html><body>
A converted Surry Hills warehouse has been listed.
The approximately 797 square metres property at 19 Foster Street comprises circa 3,154 square metres of NLA.
The property is 100 percent let, with a WALE of 2.4 years (as at 1 September 2018).
It has dual street frontage to Foster Street and Wentworth Avenue. 
The industrial-style space was refurbished in 2013 with high ceilings, polished concrete floors and exposed brickwork.
It has been listed for sale through Knight Frank’s Jonathan Vaughan and John Bowie Wilson, with Karbon Property’s James McCourt and Joshua Watts, on behalf of Security Capital Australia. 
Vaughan said commercial properties in the area are tightly held.
“Substantial office buildings in Surry Hills are highly sought after by investors as they don’t come to market very often and we are continuing to see an increase in interest in the city fringe, with a number of groups now undertaking active city fringe buying strategies,” Vaughan said.
“Further, the asset’s favourable lease expiry profile and low rental base will provide an incoming owner the opportunity to add significant value by leveraging one of the most sought after leasing markets in the country.
“With opportunities such as these hard to come by and the asset catering to a generational shift in the occupier market, we expect the industrial-style creative space will draw significant interest from local and offshore investors.”
McCourt said the Sydney city fringe area had the lowest vacancy rate of any commercial market in Australia.
“The vacancy rate in Surry Hills has been contracting for three consecutive years as it has become the number on destination for the growing TAMI sector.
“As a result vacancy in the city fringe area was sitting at around 3% relative to 4.6% in the Sydney CBD, as at January 2018. 
“The falling vacancy rate combined with growing demand and limited supply has led to substantial growth in prime rents in recent years.
“This provides the incoming owner with the opportunity to benefit from a substantial reversionary uplift in 19 Foster Street.”
The expression of interest campaign is set to close at 4pm on Wednesday 31 October.
 
</body></html>

Converted Surry Hills warehouse office building listed

<html><body>
Small business confidence and creative thinking by CBD landlords have driven a 235% increase in demand for small office space in Melbourne, says Colliers International.
The firm reported a year-on-year increase in demand for sub-300 square metre office suites in the Melbourne CBD.
“This accelerated demand highlights the strength in sentiment among small business owners,” Colliers International’s Milly Stockdale said.
“We received 748 enquiries for small suites over the past financial year FY 2017/2018, compared to 318 enquiries from FY 2016/2017. This equates to 2.3 times the demand, year on year.
“This demand has also flowed through to leasing activity, with Colliers International concluding over 100 deals for space under 300 square metres in Melbourne’s CBD year to date, compared to less than 70 at the same time last year.
“Over the next 12 months, there is only 115,000 square metres of new supply space and over 81,000 square metres of backfill space due to be added to the Melbourne CBD market. This means vacancy rates will continue to tighten, providing competitive tenant conditions.”
The lack of upcoming supply is causing tenants to commit to space to ensure that they don’t miss out on a quality address, it says.  
Strong population and job growth in Melbourne is supporting rental growth and a healthy environment for small businesses to expand.
In the recent deal, a2m Consulting secured its first CBD office, leasing 132 square metres at Suleman Group’s 470 Collins Street in a deal negotiated by Stockdale and colleague Brigitte Doupe. 
“Many iconic CBD buildings are choosing to execute a small suite strategy on vacant whole floors, due to the uptake in the market and effective net rental growth and minimal downtime,” Doupe said.
“Recent activity at 470 Collins Street – where we have negotiated 10 sub-400 square metres leasing deals in the last eight months – is a prime example of this.”
“This trend has also been recently demonstrated at 360 Collins Street, where Colliers International has secured 23 tenants under 400 square metres in the last 18 months for Dexus Property,” Colliers International’s Adam Davy said.
“This growth in demand can be attributed to several factors, including the strength in sentiment among small businesses, and the Melbourne economy supporting small business growth.”
Doupe said small businesses were jumping at the chance to secure CBD space which would see them benefit from easy access, quality of amenity and proximity to clients and stakeholders.
 <img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2018/9/28/151013_470_Collins_st_071.jpg" alt="">
Additional leases at 470 Collins Street have included:
-          Cherub Consulting (45.4 square metres)
-          Javadi (52.3 square metres)
-          Efex Group (40 square metres)
-          Endeavour Conultants (63.4 square metres)
-          Australian Institue of Engineering &amp; Technology (139.1 square metres)
-          Jaythorm (147.80 square metres)
-          United Almonds (100.4 square metres)
-          Austudy (209 square metres)
-          Egali (85 square metres)
-          Unify Solutions (96.4 square metres)
</body></html>

Office

Editor's Picks

Have something to contribute?

Developments

New apartments

New townhouses

News

Office

Editor's Picks

Receive the latest news stories to your inbox

Have something to contribute?

Developments

New apartments

New townhouses

News