Developers are seizing the opportunity to redevelop older office stock in South Australia as the state’s capital, Adelaide, struggles to keep pace with demand for space from booming industries.
Much of Adelaide’s secondary office stock has remained in the same hands for 40 to 50 years without any major upgrades as tenants, with limited B and C-grade refurbished options, have tended to stay put, says Jamie Guerra, Head of JLL’s Adelaide Office.
“Demand, feasibility and confidence haven’t come together in the past to encourage sustained tenant activity in the secondary market and as a result landlords of older stock have been able to maintain a viable level of occupancy and strong returns relative to their capital outlay,” he says
While property funds are snapping up secondary offices, many are also being kept within families, where second-generation owners will be required to take a fresh approach to their assets.
Landlords are taking a whole-of-building approach to refurbishments with emphasis on communal space, says Anthony Meola, Commercial Manager, Project and Development Services, JLL.
“We’ve seen a departure from the idea of a building as a collection of separate offices contained behind a closed façade. There’s a huge focus on amenities, shared lounge environments and inviting the community into the building with ground floor activations.”
Read more at : https://www.theinvestor.jll/news/australia/office/why-adelaides-older-stock-is-an-opportunity-for-investors/