Perth Office Space Rents Soar

Thinking of leasing prime down-town office space in Perth, Western Australia? You might get a better deal in Paris! I am serious. A record of A$900 per sqm has just been set for a lease on the Exchange Plaza building on The Esplanade. According to reports the undisclosed tenant does get prime water views in a top notch building: you'd want them for that price: that's A$500,000 / year for 500 sqm! This rate is a stunning 40 per cent increase o the previous highest rent of A$650 per sqm this time last year

With vacancy levels near zero in the central city it seems likely that premium grade towers in Perth will hit A$1000 by year end: that's more expensive than Melbourne and on a par with Paris. The tenants who have negotiated "off the plan" or "pre-commitment deals" of around A$600 per sqm will be pretty happy about now I would say ! However the next generation of Perth skyscapers are still 18 months away at least: and not immune to the lack of skilled workers which is plaguing all large-scale projects in Western Australia at the moment.

With the resource boom showing no signs of slowing down the traditional power base of Melbourne for the mining and exploration industries appears to be moving out of Melbourne and westward to Perth.

Mining heavyweight BHP Billiton has announced that they are is moving head office staff to Perth and will move into a new 72,000 square metre skyscraper at 125 St Georges Terrace, known as City Square. BHP Billiton will effectively shut up shop on Melbourne and relocate its head office to Perth, severing a 123-year-old link with Melbourne. That's another 1800 odd staff moving into prime office real estate before 2012.

So if you are smaller or lower budget operator looking for prime city or West Perth commercial real estate you may have to think outside the square or at least outside of the central city. Alternatively maybe its time to build your own commercial property?