Ad agency moves 900 workers back into new city office
Advertising agency Clemenger Group is moving staff back into Melbourne’s CBD, accelerating the city’s rejuvenation after last year’s harsh lockdowns forced most workers to stay home.
Clemenger, the first major company to move back into the city since the pandemic started, is consolidating its 900 staff from two city-fringe offices into four levels of loft-style offices in the refurbished David Jones menswear building in Bourke Street Mall. Until now, the firm was based in St Kilda Road and South Yarra.
It comes as Charter Hall and Cbus Property re-signed mining giant BHP to a seven-year lease extension covering 5000 square metres of office space in the historic front section of 171 Collins Street, a premium 19-level building they jointly own in the popular “Paris end” of the strip.
Clemenger’s move, one of the biggest leasing deals of the year so far, was welcomed by Lord Mayor Sally Capp, who said it was a “vote of confidence” in the city’s future as an economic hub.
“We are experiencing week-on-week growth in our foot traffic as employees return to city workplaces,” Ms Capp said.
The city’s premium office towers are slowly filling with workers, recording their highest office occupancy in February since midway through last year, at 15 per cent, Property Council figures show. Sydney’s vacancy for the same month was slightly higher at 18 per cent.
Occupancy bottomed out over the January holiday break, but the Property Council expects the flow of staff back into city businesses to accelerate in March.
Office occupancy is a key indicator of much-needed activity for shops, restaurants and other city-based services that depend on patronage from workers.
Clemenger is taking 7500 square metres of space, effectively all the available office floors in the David Jones building, which is set to undergo a $22.55 million renovation that will add a rooftop terrace and balconies for office tenants across four upper floors, plus space for a 2245 square metre supermarket in the basement.
The building, owned by property fund manager Newmark Capital, recently signed beauty retailer MECCA as a flagship tenant in the ground and first floor retail spaces to take over David Jones’ tenancy.
Another top fashion retailer, Rodd & Gunn, will set up a flagship shop at the rear of the building, which backs onto Little Collins Street.
And in a further sign of the city’s rejuvenation, beauty retailer Aesop will move into an 80 square metre store in the Georges building at 162 Collins Street. Aesop took a space next to shoe retailer Christian Louboutin in the distinctive white building in an off-market deal negotiated by Collier’s Jennifer Tai and Adam Lester.
Newmark general manager of property, Angus Machutchison, said the David Jones building was now “90 per cent pre-leased to premium-grade retail and office tenants prior to the refurbishment works commencing.”
Architects Bates Smart are leading the redesign of the historic 299 Bourke Street building, focusing on its mall-facing heritage front, along with upgrading canopies and adding fresh glazing.
Clemenger’s offices will be accessed by a dedicated lobby at 280 Little Collins Street. Group chairman Robert Morgan said the agency is returning to its “birthplace”.
“It was in the CBD where the company’s founders opened John Clemenger Advertising in 1946, in the basement of a building in Bourke Street,” he said.
Colliers and JLL are the leasing agents for the Newmark project.
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