Private Property Trust No. 1
Initially acquired in 2001, Fawkner Property became the manager of the trust that owns the Heidelberg property in June 2011 and has managed the asset since.
Approximately 3 years from the expiry of the tenant’s lease, Fawkner Property’s continuous engagement with the tenant identified that their office space requirements had changed over time and a significant portion of the space that they occupied was surplus or was to become surplus to requirements prior to their lease expiry.
Fawkner Property was able to introduce to the property an ASX200 company which had a substantial and growing space requirement in the immediate area. This tenant then leased the surplus space in the building for the balance of the existing lease and entered into a new lease which was to commence once the incumbent tenant’s lease expired, effectively leasing the entire building for a 15-year term.
Through the renegotiation of the tenancy arrangements in the building, an opportunity to lease the building’s rooftop for an advertising sign arose, which added more than $1 million to the capital value of the building, whilst further increasing cashflow at the property.
In the medium term, the Heidelberg site is firming as an impeccable asset with considerable upside. An adjoining property has recently been granted a permit to construct a 9 story apartment building and due to its large land holding and prominent corner position, the Heidelberg building could easily accommodate a taller building.