Thursday 13 September 2007

Listed diversified property group Devine Limited (ASX: DVN) has launched a new $75 million A-grade commercial development, ICB Central, at 15 Butterfield Street in Brisbane's near-city suburb of Herston, opposite the Royal Brisbane and Women's Hospital.

Devine acquired the 4,900 square metre development site in June 2007 for $11 million.

ICB Central is Devine's first near-city commercial development and will feature 11,000 square metres of net lettable area. It will offer tenants floor plates of 3,279 square metres, the largest currently available in Brisbane's office market.

The four-level project will target a 4.5 Australian Building Greenhouse Rating (ABGR) and be built by Devine Constructions. Work will commence later this month and is scheduled for completion in August 2008.

Devine founder and Managing Director David Devine said ICB Central was an innovative development that was well timed to meet the record tenant demand for quality and strategically located near-city office space.

He said the project's large floor plates would be highly sought after given the rarity of such offerings in a Brisbane office market dominated by record low vacancy rates.

"ICB Central's 3,279 square metre floor plates are the largest available in Brisbane and can accommodate almost 300 people per floor," Mr Devine said.

"Spacious floor plates are highly attractive to tenants as they create enhanced operational synergies between employees. The more staff that can be accommodated on one floor effectively reduces business operating costs and generates greater efficiencies.

"This project is specifically designed to cater for the significant pent-up tenant demand for large floor plates in Brisbane's near-city. We are buoyed by the strong tenant response to date, highlighted by the fact we will be commencing works this month."

ICB Central is located only 2.2 kilometres from the Brisbane CBD and directly opposite Queensland's major hospital, the Royal Brisbane and Women's Hospital (RBWH). It is also opposite the 1,400-bay Butterfield Street Metro Carpark and within 800 metres of Bowen Hills railway station, one of only four Brisbane stations which all train lines pass through.

Mr Devine said ICB Central was strategically positioned in the emerging Bowen Hills/Herston precinct, which was set to benefit from the large-scale transport infrastructure projects currently under construction in the area.

"Bowen Hills is already well established as a key commercial health, media and research hub in Brisbane's inner northern fringe and offers easy access to the CBD, Inner City Bypass and public transport," he said.

"The precinct will continue to evolve into a dynamic, transit-orientated business location with unrivalled future connectivity to all areas of Brisbane."

DTZ Research Analyst, Dr Sacha Reid, said vacancy rates in Brisbane's fringe suburbs have fallen from 10.9% to 1.3% over the past four years.

"The vacancy rates are further compounded when examining different grades of buildings," Dr Reid said.

"A-grade stock in the Brisbane fringe, such as that being offered at ICB Central, is at 0.1%.

"This has been driven by the limited supply of quality new stock in the fringe in recent years and the significant net absorption as companies look to upgrade their premises or are forced to relocate because of extremely low vacancy rates in the Brisbane CBD, which is currently 0.3%."

According to Jones Lang LaSalle Research, the Brisbane Fringe Office market vacancy rate is just 1.1%, which represents only around 8,900 square metres of primarily secondary space available.

Jones Lang LaSalle Leasing Manager, Don Mackenzie said, "The fringe has never needed new quality space more, particularly space like ICB Central that fully utilises existing and future transport infrastructure and is in line with the intention of the South East Queensland Regional Plan to promote increased development around transport nodes like Bowen Hills."

ICB Central is located directly opposite the proposed RBWH Busway Station, which is part of the Northern Busway project scheduled for completion to nearby Northey Street by late 2009. It is anticipated that by 2016 more than 13,000 people per day will get on or off at the RBWH Busway Station.

ICB Central will have immediate access to the $2 billion North-South Bypass Tunnel (NSBT), which will connect the Pacific Motorway and Ipswich Road in Woolloongabba with the Inner City Bypass, Bowen Bridge Road and Lutwyche Road in Bowen Hills. The NSBT is due for completion in 2010.

ICB Central will also have easy access to Airport Link, a $3 billion mainly underground road connecting the NSBT, Inner City Bypass and local road network at Bowen Hills to northern arterial roads, east-west arterial and the Brisbane Domestic and International airports. Completion of Airport Link is due in 2012.

Devine's ICB Central will offer high-profile exposure to major arterial road Bowen Bridge Road, and will include prime ground floor retail space. There will also be basement parking for 136 cars.

Designed by the award-winning Cottee Parker Architects, the project's modern design is highlighted by innovative north-facing, break-out decks overlooking the surrounding northern parklands and sporting fields. This provides excellent amenity for staff to meet in a relaxed, open-air environment.

The launch of ICB Central follows the success of Devine's first office project at 333 Ann Street in the Brisbane CBD.

The $120 million A-grade office tower, which has been acquired by Domaine Property Trust and is scheduled for completion in June 2008, is already 80% preleased or under negotiation and is expected to be fully leased over the next two months.

Devine has a current national pipeline of land developments and projects which, when completed and sold, will have an end value exceeding $3 billion.

On 29 August Devine announced an after tax profit of $21.367 million for the 2006- 07 year, 13.2 per cent up on the previous year's result.

Released by: David Devine, Managing Director, Devine Limited on (07) 3233 1402
Contacts:Kathy Mac Dermott, Rowland on (07) 3229 4499 or 0448 844 508

Prepared by:Sarah Martin, Rowland on (07) 3229 4499 or 0418 748 892