Three large office floor plates are now available to lease in Wellington’s Cuba Precinct, providing some much-needed vacancy to relieve pressure in the CBD.
Steve Maitland, Director of Office Leasing at Colliers Wellington, says Victoria Lane Office Campus
is the only base-isolated office building within Wellington CBD with any substantial vacancy.
“Once these floors are leased, it will be a minimum two-year wait for comparable space.”
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The master-planned and mixed-use complex is a mix of new and strengthened heritage buildings covering 16,000sq m combining office, the creative arts, retail, and apartments.
It will comprise three newly built office floors together with ground floor retail and is expected to be finished in the first quarter of 2023.
Maitland says the Wellington landlord market is not reacting quickly enough to the seismic dilemma with numerous buildings sitting empty – below 33 per cent NBS – requiring a full seismic upgrade to deem them ‘leasable’.
“No tenants are expected to commit to them until the NBS rating lifts above at least 68 per cent but ideally 80-100 per cent NBS,” Maitland says.
“Victoria Lane Office Campus exemplifies what Wellington tenants are looking for with staff and client wellbeing, as well as business continuity, at the forefront of their minds.”
Together with seismic security and a lively central location, it has large open floors with excellent height, a central staircase allowing for interfloor connectivity, excellent natural light, showers and toilets on every floor, ground floor parking for bikes, onsite parking, and EV charging.
Greater Wellington Regional Council’s 400 staff and Whitireia WelTec’s 1,000 creative technologies and art students are already based in the Cuba Precinct.
“There are plans for additional new buildings but the soonest delivery for these is most likely 2025. That leaves an immediate gap to be filled and this will exert continued pressure on the top end of the building market in Wellington where seismic concerns are still the major issue affecting tenants,” Maitland says.
“No landlord is starting with a mentality of ‘build it and they will come’. We have a conservative market and a high level of tenant precommitment – usually a minimum of 60-70 per cent – is required to be the catalyst for a project.
“We are fully expecting that further buildings will be ‘red carded’ meaning that as new seismic reports are produced and received, some of these buildings will need to be vacated to be remediated.”
Maitland says this can take up to a year and rising tenant concern about seismic ratings could cripple a business.
“Where previously 68 per cent NBS was acceptable, tenants are now setting new minimum thresholds of either 80 per cent or 100 per cent NBS.
“Many existing Wellington office buildings will not achieve 100 per cent NBS. So, to have the new generation of building coming through offering this peace of mind with new seismic credentials is paramount.”
Maitland says rentals for the Victoria Lane office floors are at a par with rentals currently being achieved in A-grade buildings within the CBD with a far lower seismic rating.
- Article supplied by Colliers
