Brisbane’s suburban office market is likely to be one of the few winners from the Covid-19 pandemic, according to boutique fund manager Alceon.
Alceon has now rebooted work on a three-level A-grade office building at 385 MacArthur Avenue in the emerging Northshore Hamilton business hub following a pause in construction at the onset of the pandemic.
The Blight Rayner-designed office building, the fifth project to be developed by Alceon and construction partner Graystone in the precinct, will comprise more than 3,500sq m of office space.
Alceon Queensland project director Paul Huston said the group had pushed forward with construction in an attempt to beat the upsurge in requirements from occupiers trying to position themselves in emerging fringe markets over the course of 2021.
“After four months and an extensive assessment of the potential market impacts, we have re-activated the speculative project and construction is in full swing again,” Huston said.
“Traditionally, the speculative suburban office construction market is quite thin on the ground.
“It is also largely focused on occupiers of 500sq m or less and until they can touch, walk, feel and breathe the space they are unlikely to make a decision.”
Office rents weakened across Brisbane’s CBD over the June quarter as landlords increased incentives to win over tenants in a pandemic-softened market.
Demand has also declined significantly during the crisis, with most businesses delaying office decision-making or opting to renew or extend leases on a short-term basis.
Alceon is currently developing 15,000sq m of A-grade commercial space across three buildings at Acuity Business Park at Robina on the Gold Coast.
Last month, Alceon also lodged plans for a $200 million mixed-use development on the site of the 10-storey Tatts Group office tower in Albion.
The project, located at 240 Sandgate Road in Albion, will see the existing four decade-old building retained and redeveloped, as well the addition of two new mid-rise towers for commercial and residential uses.