That is really Adealide's major problems in terms of high rise density - I can't see that company looking to pay the required rental to have a new building built as it as the head lease.AG wrote:It's quite possible that neither of the two parties in the joint venture for this development would've got financing approval had they decided to go at it alone.Waewick wrote:that is true
but that alse reflects the depth in the market on both developers able to handle that level of debt and potential tenants.
There wouldn't be many Adelaidians (in the development game) able to sit on $80-100m whilst the locate tenants and given we still live in a city where the vast majority of tenants of these spaces are Government departments the likely hood of picking a decent tenant is also difficult.
The last point you bring up highlights how dependent Adelaide's office market is on government departments to get projects up and going. A significant chunk of City Central 1 is occupied by government departments, there's the SA Water Building as well. Most tenants in the Adelaide market are smaller firms or small operating centres of companies based interstate. There's a handful of companies based in Adelaide that have enough weight to justify a large new office building (e.g. Santos), but nowhere near as many as interstate. I do know one company that is located at 33 King William Street currently occupies 5 floors of that building, and they've recently had to take out space in Grenfell Street because of the rapidly growing Mining sector, so there are a few around.
We are a state of SME's which if they do grow beyond that , move head quarters to Sydney or Melbourne.
If someone can wave their magic wand and get not only to population density required but also the business comminty density requried we will start seeing things change around here.
but until then, new buildings will be about Government departments, the people that serivce them and the service providers for the SME's (Banks, Accountants, Lawyers)
