Charter Hall consolidates government to ex-Foxtel HQ
In one of suburban Melbourne’s biggest office lease deals this year, Charter Hall has secured the Department of Agriculture, Water and Environment to three quarters of the Moonee Ponds building recently vacated by Foxtel.
The federal government division will consolidate to 1-21 Dean Street from three locations: Customs House at Melbourne Airport, 255 Melrose Drive, Tullamarine and 2/5 McClure Road, Kensington.
It wasn’t the group’s first choice – that was the Younghusband redevelopment, also in Kensington, where it pre-committed to c4400 square metres in 2020.
However when a revamp of that complex was delayed and the landlord, Impact Investment Group, then put the property up for sale – the search restarted.
The Moonee Ponds lease is for an initial 12 years.
For the foreseeable future then, a multi-level 250 bay car park which spreads nearly half the 6702 square metre Activity Centre zoned block near Moonee Valley Racecourse’s main entrance, won’t be developed.
The Younghusband complex meanwhile sold in March to Irongate and Ivanhoé Cambridge for c$60 million.
Costs curbed
The government said the Moonee Ponds move will help it meet business requirements and cut on operating costs.
Charter Hall has spent the better part of the year modernising the four storey, 7104 sqm building, with over 280 solar panels.
The ground floor lobby has also been reconfigured, including with a new café tenancy.
End of trip facilities have been built in too.
“The upgrade will achieve a minimum 4.5-star NABERS Energy Rating, adding to the sustainability credentials,” a statement said (story continues below).
“Comprehensive waste management practices will also be introduced, with waste from the redevelopment and office fit out to be diverted from landfill,” it added.
Colliers’ Tom Larwill is marketing the 150 sqm retail tenancy. Colleagues John Howell and Kevin Tutty with JLL’s Mario Nobegra and Matt Szakiel are leasing the balance (c1950 sqm) of office space.
Next chapter
The Moonee Ponds office was developed for Foxtel in 2004.
Three years later, Trinity Funds Management sold it to the PFA Diversified Property Trust as part of an unusual property-swap deal, with 388 Queen St in the city.
The parties priced 1-21 Dean St at $28.5m at the time.
Charter Hall acquired the unlisted PFA entity in 2012, for $444.5m.
Now known as the Charter Hall Direct PFA fund, it is worth $2.4b.
It unsuccessfully tried to sell the Moonee Ponds property in 2019, asking c$45m.
“This [rental] agreement is directly in line with our fund’s strategy, with a focus on high quality office buildings underpinned by strong tenant covenants with government or well regarded corporate tenants,” Charter Hall Direct chief executive officer, Steven Bennett, said.
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