JONES BAY WHARF Suites 56 and 56A
Leasing Proposal • September 2019
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TABLE OF CONTENTS INTRODUCTION
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City Fringe market 6 Property Overview 8 Recommended Marketing Rentals 10 LEASING AND MARKETING STRATEGY 11 Detailed Marketing Budget 12 Agency structure and fees 13 Leasing Scale of Fees and Charges 13 Resources 15
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Leasing Proposal | Jones Bay Wharf Suites 56 & 56A
INTRODUCTION Brad Wilson Chief Financial Officer Phoenix Leisure Group Pty Ltd Suite 56, Jones Bay Wharf 26-32 Pirrama Road, Pyrmont NSW 2009
Dear Brad, Suites 56 and 56A at 26-32 Pirrama Road Pyrmont Thank you also for meeting with me about the leasing of the above mentioned premises. We expect that such a lovely office space will attract a lot interest and that we can build a compelling campaign around this leasing opportunity. We trust this proposal will meet your needs and look forward to the opportunity to act as your agents in the leasing of the property. Thank you,
Eric Lundberg Consultant – Sales, Leasing and Advisory LREA|BA|Grad Dip Land Econ 0411 647 510|ericl@tgc.com.au
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ABOUT TGC
25+ YEARS EXPERIENCE
OPERATE IN CBD, FRINGE & METRO
RETAIL, OFFICE AND INDUSTRIAL
WE ARE FLEXIBLE
AVERAGE STAFF RETENTION 7 YEARS
WE TAKE A HANDS ON APPROACH
TGC is the largest privately owned commercial real estate agency in the Sydney CBD and the City Fringe. We’ve been operating independently since 1991 and have a proven track record in selling, leasing and managing CBD, fringe and metropolitan strata and freehold properties, heritage buildings, retail centres, licensed hotels, and industrial premises. TGC employs 28 experienced staff to provide in-house Property Management, Facilities Management, Financial Management, Sales and Leasing, and other operational services, and who work tirelessly to provide an outstanding customer experience & deliver superior results. At TGC we treat our staff like family, with safety and welfare being paramount in our company culture. We promote a safe and flexible
working environment, open communication and diversity of thought. We have a current average employee retention rate of six years. We feel this is a measurable indicator of positive staff engagement, which in turn leads to positive results for our clients and our customers. Over the years, TGC has been involved in various projects, such as the management and leasing of Chester Square Shopping Centre and rejuvenation of Condell Park Shopping Centre. We also sold 112 Castlereagh Street, Sydney achieving a record result for that precinct. Our Property Management division also currently looks after some of Sydney’s premium grade assets, including 2 Martin Place, 341 George Street and 60 Elizabeth Street to name a few.
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Leasing Proposal | Jones Bay Wharf Suites 56 & 56A
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CITY FRINGE MARKET In the last 6 months the level of leasing enquiry overall has declined significantly compared with the intense competition for space during 2018. January saw a marked change in the level of activity and willingness to act. Many enquiries have come into the market, investigated options and then decided not to proceed. This is reflective of a sense of caution arising from lower business confidence as is evidenced in a range of market indicators. There are headline grabbing deals announced, but there is very often a back story in these situations. The fact is that the overall level of market demand is undeniably low. That said, good space, priced sensibly, leases. Your space is outstanding, has a great sense of style and place providing a strong branding statement for high quality creative industry tenants. Within Jones Bay Wharf there are a number of vacancies being advertised and upcoming and we have made our marketing recommendations in this context. We will continue to monitor this aspect very carefully while marketing your space. We have deep connections in the city fringe creative and knowledge-based industries and can demonstrate a well-established capacity to close deals with this market segment. We understand what makes them tick. This is a more challenging leasing environment and TGC has the skill, contacts, knowledge and experience to operate effectively and with purpose to get the best results.
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“Your space provides a strong branding statement for high quality creative industry tenants�
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Leasing Proposal | Jones Bay Wharf Suites 56 & 56A
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PROPERTY OVERVIEW Your premises offers high quality presentation suited to the most demanding tenants. Providing an exceptional working environment, it will assist creative and knowledge based businesses in attracting and keeping their most valuable asset: skilled and productive staff. The fitout in the premises is quite generic and will be very adaptable for a wide range of potential occupants. This is a significant appeal as good fit-outs are expensive and time consuming to provide. We have assumed that the premises will be offered, with the furniture and workstations removed but the fixed fit-out in situ. Jones Bay Wharf is obviously a highly regarded address, with its exceptional blend of heritage restoration and cutting edge services. As a business location it offers a terrific working environment and a significant intangible branding premium. We understand that the areas on offer are Suite 56, being 578M2 and Suite 56A, being 100M2. We also understand there are 3 car spaces available.
Positives • Wonderful high quality space • High quality fit-out with great generic appeal to creative industries
• Some resistance from some tenants due to perception of walk to public transport – especially for women in winter months when it gets dark earlier. This is based on market feedback and can be overcome
• Vaulted high ceilings and beautiful heritage features
• Some resistance from some tenants to being split over multiple floors
• Easy access to site via public transport including light rail
• Limited parking on site
• Spectacular setting with extraordinary views
• Manageable walking distance across Pyrmont Bridge to Town Hall Station • Easy access via taxi and Uber to the CBD • Good restaurants, cafes and other eateries in close proximity • An iconic property with great brand reinforcement for tenant companies • Widely regarded as being worth a premium rent 8
Negatives
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RECOMMENDED MARKETING RENTALS We recommend offering the spaces to the market on the basis of gross rental leasing frameworks as follows: Suite 56 – 578M2 Lease term: 5 Years with 5 Year option Annual Rental: $750 PSMPA Gross + GST | $433,500 PA+GST Reviews: Annually by 4%. Market review at option start (not to reduce). Outgoings: 100% of increases only in outgoings over base year 30 June 2020 Available: 15 January 2020 (your instructions would be appreciated) Suite 56A – 100M2 Lease term: from 2 Years Annual Rental: $775 PSMPA Gross + GST | $77,500 PA+GST Reviews: Annually by 4%. Outgoings: Included in rental (simpler deal given smaller space and shorter term) Available: Now (your instructions would be appreciated) This approach is considered sensible in the context of market conditions and the undoubted value and benefits of the premises and still allows room for negotiation of a mutually suitable leasing package to secure a good quality tenant.
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Leasing Proposal | Jones Bay Wharf Suites 56 & 56A
LEASING & MARKETING STRATEGY
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We propose a multichannel marketing program, drawing attention to the features of the property via traditional agency marketing, communication with our extensive database and direct targeting of potential tenants. The following is a summary of our recommended approach for reaching prospective tenants: Signage Corflutes to display in the window of the premises. Individual internet listings • Feature listing on tgc.com.au – we currently invest heavily in SEO and Google Paid advertising to drive website traffic and enquiry • 90-day Elite Plus Flexi listing on Real Commercial portal to ensure we are at the top of the advertising portal • Platinum 13-week listing on Commercial Real Estate Database Targeted emails and follow up meetings to our extensive database ensuring we cover all tenant groups. Professional photography Professional imagery is vital for quality web listings and social media marketing.
Social Media Promote the listing through our LinkedIn, Instagram and Facebook social channels – both company and agent pages – and launch a paid, targeted promotion of the listing on Facebook. Brief to tenant representatives Email to tenant representatives who are active on the City Fringe with the offer of a private viewing early on in the campaign. Other recommendations • Local canvassing • Proactive engagement with other agents 11
Leasing Proposal | Jones Bay Wharf Suites 56 & 56A
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DETAILED MARKETING BUDGET DETAILS
INVESTMENT
Professional photos
$300
Email Marketing
Targeted emails to TGC city/ fringe database
Included
E-Flyer Packages
Upon inspection
Included
DL FLyer
Local drop x 500
Included
Promote listing and story
$350
Organic post + paid advertisement
$200
Including ad copy writing, email marketing + social
$300
Corflutes
$100
Feature listing
Included
90-day Elite Plus Flexi listing
$2,097
Platinum 6-week listing
$1,980
IMAGES Photography DIGITAL AND PRINT
Marketing Coordination Signage ONLINE ADVERTISING TGC website Real Commercial Commercial Real Estate
TOTAL
$5,327 + GST
OPTIONAL (RECOMMENDED) In house video presentation TOTAL INVESTMENT EX GST
Updated YouTube clip
$1,800 + GST $7,127 + GST
AGENCY STRUCTURE AND FEES
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We recommend that you appoint TGC on the basis of the attached Scale of Fees and Charges. This provides for our standard fee in the event of a tenant being identified and secured by TGC, while also facilitating our involvement of other agents on a coordinating basis. This way you will achieve the most effective coverage of the market, ensuring that if there is a suitable tenant looking, they will be provided with the opportunity to consider your space.
LEASING SCALE OF FEES AND CHARGES 1. “Rent” and “Average Annual Rent” Defined The term “rent” as used in this Scale of Charges and for the calculation of commission: • Rent shall mean the total rent reserved by the Lease or Agreement to Lease for the whole of the term certain expressed in such lease or Agreement to Lease together with any additional charges such as for cleaning, outgoings contributions, partition or shopfront rentals, naming or signage rights, car parking fees and any other payment to or on behalf of the Principal for which the Lessee is made responsible under the Lease or Agreement to Lease, irrespective of the purpose to which the payment is subsequently applied, but excluding payments made as security deposits. For these purposes, “Principal” includes an assignor or sub-lessor, and “Lessee” includes an assignee or sublessee. In calculating the Agent’s commission under the Agency Agreement, cash allowance, rebates rent free periods or similar incentives offered by the Principal as an inducement to lease shall not be taken into account. • “Average Annual Rent” shall mean the total rent (excluding GST) payable divided by the number of years in the term certain of the relevant Lease or Agreement to lease. 2. Commission. Calculated on the average annual rent reserved under the lease at the following rates: Lease of 3 years or less Lease of 4 years Lease of 5 years
11.0% + GST 12.0% + GST 13.0% + GST
Plus 0.5%+GST for each year or part thereof in excess of 5 years. Where a lessee is introduced by another Agent 125% of this scale shall be payable and shall be shared: • 75% to the introducing agent and • 50% to TGC 3. Commissions Due and Payable Letting commissions shall be due and payable upon the earliest of the following: • Execution of Agreement for Lease or Memorandum of Lease or Deed of Assignment; or • Entry of the tenant into possession of the premises leased; or • Commencement of rental payments by the tenant. 4. “Term” of Lease For the purpose of calculating the Agent’s commission or fee the Lease period is the term certain of the Lease, excluding the period of any further term which the Lessee may be entitled to take up by exercise of an option..
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RESOURCES
ERIC LUNDBERG
Consultant – Sales, Leasing and Advisory LREA | BA | Graduate Diploma in Land Economics With his formal qualifications and over 30 years in commercial property, particularly at the forefront of the transformation of the Sydney City Fringe market, Eric brings to TGC a deep understanding of the market and all relevant industry players. Eric has assisted developers, investors, creative agencies, owner-occupiers, NGO’s, unions, industry associations, retailers, and government departments in finding the appropriate solution to their property needs. An astute professional in every sense of the word, Eric’s broad connections and market know-how make him a trusted and accomplished agent. Known particularly for his unrivaled experience, he is widely recognised for his dedication and perseverance in satisfying his clients’ requirements.
GINO SOGLIMBENE Sales & Leasing Consultant LREA
Gino Soglimbene is part of TGC’s Commercial Sales & Leasing team. He focuses on commercial leasing within Sydney’s City Fringe. Gino is a licensed real estate agent that brings over 15 years experience in small business and hospitality. He has also worked as a Tenant Representative for major international retailers. Gino’s passion for property paired with his friendly personality and background in hospitality, make him a pleasure to deal with. His strong work ethic and enthusiasm are welcome assets to the TGC team.
Angela Byrne
Marketing Manager Angela is responsible for driving and leading the marketing strategy, branding activities and campaigns for the TGC Group. Angela has over 15 years of experience in marketing and communications including print and digital marketing, marketing strategy, advertising and PR campaigns for nonprofit organisations, government and commercial industries. She has a portfolio of successful advertising and marketing campaigns in the USA & Australia.
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No responsibility is accepted should any third party use or rely on the whole or any part of the content of this proposal. While care has been taken to verify the accuracy of the information herein, no warranty is given. TGC will not be held responsible for any error or mis-description which may appear. All parties should make their own enquiries in all respects. Any projected rentals or prices mentioned herein are estimates only and are not - and cannot be - guaranteed. This is not a valuation. All areas are approximate only and are provided subject to formal survey. The whole of the contents of this report is the property of TGC. No part of it may be reproduced without written consent.