Melbourne developers and regular collaborators Pellicano and Perri Projects have won approval for a 20-storey commercial tower two years after Perri picked up the 1,532sq m site for $26 million.
The duo said that they expect to join the construction “mini-boom” in Melbourne’s CBD by mid-2020, with the amount of office space in the CBD set to increase by about 10 per cent next year.
The tower will bring 12,000sq m of A-grade office space to the north east corner of Melbourne’s CBD, within a few hundred yards of the Charter Hall-controlled $1.2 billion Wesley Place development precinct.
The privately-owned duo tapped architecture firm Fjmt to design the building, which has an end value of $170 million and represents Perri Project’s first foray into the CBD office market.
The building will offer a range of floor plates to attract a diverse mix of businesses looking to lease entire floors.
“The lower levels will offer larger 1,200sq m floorplates for larger businesses, while the upper levels will target SMES and offer smaller floorplates,” Perri Projects managing director David Scalzo said.
Scalzo said that Perri and Pellicano will adopt a long-term retention strategy for the asset.
“As the first boutique A-grade office building to be built in Melbourne’s CBD in years, 17 Bennetts Lane is a unique offering for a wide variety of creative and forward-thinking businesses,” Scalzo said.
The rosy outlook for Melbourne’s CBD office market is set to continue, according to BIS Oxford Economics, which forecasts a 30 per cent to 40 per cent rise in prime rents over the next five years.
“Apart from a brief spike, we’re looking at six years with a sub-5 per cent vacancy rate,” BIS economist Maria Lee said.
Meanwhile, Perri and Pellicano are also developing the $700 million South City Square in Brisbane’s Woolloongabba, welcoming the city’s first Hyatt hotel to the precinct which is expected to open in 2023.