Salta is well positioned to capitalise on the resurgence of Melbourne's commercial office market, securing three permits for contemporary office buildings in thriving workplace destinations across Melbourne’s city-fringe – including Richmond, Cremorne and Collingwood.

Totalling $400m in projected end-value, the permits showcase the diversified property group’s focus on supporting economic stimulus back into Melbourne. This comes at a time when the office market is seeing positive signs after a prolonged period of poor sentiment due to the cost of construction, reduced occupancy and increased holding costs.

Salta Managing Director, Sam Tarascio, says that securing three commercial permits across key inner-Melbourne locations will help cater to increasing demand for modern, well-located office space as businesses continue to compete for quality talent, and enhance workplace experience with strong amenity offerings and collaboration spaces.

“We are pleased to receive these permits, which will see three contemporary, commercial buildings add more future-focussed workspaces and amenity to the thriving commercial hubs of Richmond, Cremorne and Collingwood,” said Tarascio.

“We are seeing more interest and demand from tenants seeking to increase their footprint to accommodate business growth, combined with companies requiring their employees to be in the office to utilise the workspace. Despite the downward cycle, we have worked hard to progress the design and planning for these projects, to help bring high-quality supply back into Melbourne’s commercial market.”

However, persistent challenges with work-from-home policies, increasing holding costs and escalating construction prices have prevented many developments across Melbourne from getting off the ground. While signs of a commercial market recovery are positive, Tarascio affirms that Salta will not be able to proceed with the permitted projects in the short term and will wait for conditions to further improve before delivering them to market. “Feasibilities for commercial developments remain particularly challenged.

There is still a way to go with respect to office vacancy and return to office mandates - in conjunction with stabilisation of development costs and office capitalisation rates. The Victorian State Government also needs to cease adding further burden to these projects with recent changes such as the increase to the Emergency Services Levy and the imposition of the Car Park Congestion Levy causing further damage to development feasibilities. Regrettably it is unclear when we will be able to progress with these permits,” added Tarascio.

"Salta’s focus is to identify sites with the goal to mobilise quickly from planning into development, and this will remain a key focus across our diverse portfolio mix. We are following the market cycles and are ready to act and deploy capital where it makes sense. With that in mind, we look forward to seeing conditions in the commercial market become more viable for us to kick off these projects from planning, into construction when challenges ease.”

Of priority is Salta’s permit for a new project located 475 Church Street, which will see a $230 million 10-storey mixed-use development. Envisioned to be a benchmark for the next generation of office developments, the project has been designed by leading architectural practice, Architectus, and is earmarked to bring more than 17,000sqm of highly-desirable and well-located office space and nearly 1000sqm of retail space to the area – a joint-venture partnership between Salta and Zagame. The project will complement Salta and Abacus Groups’ existing commercial building, Industry Lanes, adjacently located at 459 Church Street.

"Our design for 475 Church Street will provide an authentic, integrated and purpose driven office development, designed to exceed tenant needs for connection, synergy, place and growth. It will provide a physical destination as a focal point to support true hybrid work and will foster new and meaningful connections for mutual benefit for both tenants and the community,” said Shaun Schroter, Principal of Architectus.

The two additional permits allow for the progression of premium, sustainability-led, commercial developments also positioned in key locations that have been recognised for attracting top companies, and talent, to the city-fringes. Both designed by Gray Puksand, the permits have been granted for contemporary sites located at 60 Langridge Street, Collingwood and 122-128 Dover Street, Cremorne. Encompassing 5,500sqm and 8,600sqm of lettable area respectively, these mixed-use office developments will transform and further activate their streetscapes - complete with basement carparking, activated ground-floor food and beverage and end-of-trip facilities, and seven floors of contemporary office space in conjunction with outdoor terrace and rooftop zones above.

In a show of support for Salta’s permits that will see three new commercial projects added to Melbourne’s streetscapes, Property Council Victorian Executive Director Cath Evans said high-quality developments like these are essential to keeping pace with Melbourne’s rapid population growth and strong business outlook.

“If we want to remain one of the best cities to live, work and visit in the world, we must champion a thriving CBD and surrounds that supports the businesses that help make Melbourne great. The recent upswing in the commercial market illustrates that there is interest and demand for regular in-office contact for team connection, mentoring, skills growth and productivity,” said Evans.

“Melbourne remains a great city to do business, and the market is clearly demanding high-quality, well-located office projects. Salta’s leadership in delivering best-in-class developments ensures our city stays competitive, attractive, and ready for the future.”

Tarascio added, “Salta is a proud Victorian family business that has been well entrenched in developing and providing enduring value in the state for over 55 years. We are focussed on bringing back development and life to our city. We will continue to liaise with the government, and with our diverse set of stakeholders to assist more projects getting off the ground.” 

Once realised, these three projects will add to Salta’s growing portfolio of commercial assets, which also includes prominent office precincts in Victoria Gardens, Richmond and Nexus in Mulgrave.