Charter Hall Group (Charter Hall or the Group) today confirmed that its $3.7 billion wholesale fund Charter Hall Prime Office Fund (CPOF) has secured Vanguard Investments Australia (Vanguard) as a major tenant customer at the $600 million Wesley Place development, located at 130 Lonsdale Street in Melbourne’s CBD.
The new 10-year lease to Vanguard covers approximately 10,500sqm across six floors, taking the new office tower’s committed Net Lettable Area (NLA) to approximately 55%.
Wesley Place is located within the North Eastern core of Melbourne’s CBD, one of the most tightly held office precincts with a vacancy rate of 2.3% and limited new development supply in the medium term. The area is fast becoming the preferred location for major financial services organisations with ease of access to major transport infrastructure and Melbourne’s entertainment and cultural precinct.
Vanguard, one of the world’s largest global investment management companies will join Telstra Super, Australia’s largest corporate superannuation fund and Cbus Super, one of Australia’s largest industry super funds, who will locate their head offices at the address with Wesley Mission Victoria and Uniting Church in Australia also committing to long term leases.
Charter Hall’s Office CEO, Adrian Taylor said: “We are proud to welcome Vanguard as a tenant customer to our $10 billion office portfolio, who along with our other tenant customers, share our vision in creating an innovative workspace experience that offers their people both business, technology and lifestyle amenity.
“The consistent growth in tenant demand for office space in the Melbourne CBD has validated our decision to develop the Wesley Place precinct, including the recently approved office tower at 140 Lonsdale Street. Upon completion, Charter Hall’s funds total investment in the Wesley Place precinct, including the properties at 130, 140 and 150 Lonsdale Street will rise to $1 billion.”
The Wesley Place project comprises a new technology enabled Premium-Grade tower with 58,000 square meters of vertical campus style office and premium retail space across 35 floors. One of the design features central to the building’s sense of community is its four levels of cascading rooftop terraces and a revitalised urban realm comprising a retail and alfresco dining experience, along with a new urban park and activated community space.
CPOF Fund Manager Matthew Brown said: “Welcoming Vanguard to the Wesley Place development is a great milestone and demonstrates the strong leasing momentum we have been able to create with 50% of forecast income for the asset secured. Upon completion, Wesley Place will further enhance CPOF’s portfolio quality and total return metrics and deliver our Fund investors a coveted new Premium Grade office building in the tightly held Melbourne CBD core office precinct.”
Charter Hall’s Head of Office Development, Andrew Borger explained that with a national office development footprint in excess of $2 billion, the Group was focused on the delivery phase of major projects.
“This new lease with Vanguard demonstrates our approach to securing significant pre-commitments to de-risk major projects that we have underway nationally within our funds management platform. The depth of our internal development capabilities, with teams based in each major capital city means that we are able to collaborate with our tenant customers to deliver great workspace experiences as well as create institutional quality investment opportunities in the office sector
The building has been designed to achieve a 5 Star Green Star rating, a 5 Star NABERS rating along with a Gold WELL rating (core and shell).