Colliers finds a new home for global coffee brand Lavazza in Melbourne’s CBD13 February 2023
Leading global coffee brand Lavazza has committed to an entire floor in a refurbished B-Grade office building at 50 Queen Street Melbourne as they relocate to the CBD from Hawthorn.
Colliers Office Leasing agents Zak Seccull and Alissa Woods secured five new tenants to 50 Queen Street last year, totalling over 1,500 sqm of office space, with Lavazza being one of the few tenants to commit to an entire floor (619sqm) of refurbished office space in 2022 in a B-Grade building that Colliers has recorded for the past 12 months. Other tenants include the Victorian Branch of the Greens political party and sustainability consultant Umwelt.
Colliers’ Director, Office Leasing, Zak Seccull, said Lavazza was particularly interested in a CBD location that would allow them to be closer to clients and provide better public transport links to attract and retain talent. Mr Seccull said, “Lavazza was keen to build a new fitout in line with their international offices to help support their employees and their return to the office in 2023”. The deal was struck on a five-year lease term and will commence in April 2023 once the fitout is complete.
“Throughout 2022, the bulk of the leasing activity we have observed at Colliers has been focussed on quality fitted space, with limited traction on existing older style fit-outs, refurbished product or buildings that don’t offer additional tenant amenities. However, it is pleasing to see a tenant like Lavazza buck the trend and want to carry out their own fitout to align with their business strategy,” said Mr Seccull.
Mr Seccull said, “The ‘flight to quality’ trend is still evident in the market, and we are still seeing a lot of groups looking to upgrade their accommodation as occupiers are becoming more sophisticated on their accommodation requirements”.
He added, “poor quality secondary stock is becoming increasingly more challenging to rent unless upgrades to the building are made”.
Landlord Representative Fidinam, acting on behalf of its offshore clients, manages over $550 million of commercial assets in Australia, including five buildings in the Melbourne CBD, and is currently investing a further $45 million to two heritage office buildings it acquired over the past few years at 415 Flinders Lane and 226 Flinders Lane, Melbourne, which will include new retail offerings, industry-leading EOT facilities and A grade services and finishes for its future occupants. Both will be available in Q3 2023.
“The Melbourne CBD office market remains a competitive landscape for landlord’s with the vacancy rate for January 2023 sitting at 13.8 per cent. However, office occupancy in the Melbourne CBD is now gaining momentum, with approximately 57 per cent of the CBD’s workforce back at their desks in November 2022,” said Ms Woods.
“This is expected to continue to rise from February 2023 when organisations mandate an updated return to work policy, further encouraging office leasing activity,” Ms Woods concluded