Myer downsizes for Poly's Docklands tower
Department store chain Myer has signed off on a much anticipated move in Melbourne’s Docklands to a new corporate headquarters in a 24-storey tower built by China-backed developer Poly.
It will be a short hop into a downsized home for Myer, which is based a few Dockland blocks away on the extension of Collins Street into the urban regeneration precinct .
Its new home will be a $500 million Woods Bagot-designed tower at 1000 La Trobe Street, in a section of Docklands known as Digital Harbour.
For Myer, the move is in keeping with the same “shrinking to greatness” strategy it has deployed in its retail stores, where it has sought to reduce floorspace rather than close stores entirely.
At the Collins Street building, home to its “store support office”, Myer has 25,000 square metres in total, including car parking and storage areas. Over the past three years the department store giant has progressively given up 12,000 square metres of that, cutting its footprint and sub-leasing to other tenants.
It will take up just 11,000 square metres to become the anchor tenant in the Poly project nearby. Net face rents have been struck in the mid-$500 range, according to industry sources.
Chief executive John King linked the Docklands move to Myer’s broader “customer first plan” that would ensure even the corporate office was operating in the most efficient and productive way.
“This is a great outcome for Myer shareholders, with improved commercial terms and a more appropriately sized head office,” he said in a statement to The Australian Financial Review.
“It is also a great outcome for our team members with a support office that has leading technology, is energy efficient, and provides a modern office environment in which to work.”
For Poly, the securing of Myer as its anchor tenant vindicates its own strategic direction. Initially buying the site from the Liberman family-backed Digital Harbour for $32 million to pursue an apartment tower development, Poly later switched tack to an office project, which it launched last year as a speculative build.
“We understand the importance of shaping these spaces in a way that will ensure our tenants experience continued satisfaction throughout their leasing term,” said Poly’s Victorian executive director, Steve Wang.
Colliers International’s Shane Burns and Edward Knowles, along with former JLL agents Stuart Colquhoun and Ashley Buller, now at CBRE, brokered leasing in the tower. For Poly, Ronnie Moe also worked on the 10-year agreement with Myer.
Poly expects to complete the tower towards the end of 2021. Meanwhile, it has won interest from Singapore’s Keppel Capital to invest in the $500 million office tower it is preparing to build at 201 George Street in Sydney.
