Staff move unhealthy for market

THE Property Council is opposed to a single building housing Department of Health staff, saying it will further damage the already fragile office market in the Darwin CBD.

In a letter to Corporate and Information Services Minister Lauren Moss obtained by the NT News, Northern Territory Property Council executive director Ruth Palmer wants existing properties refurbished arguing it will stimulate the economy into a “win-win scenario” for everyone.

“The easy solution for the NTG would be to simply consolidate the Health staff into a new office building and ignore the economic consequences of such a decision,” she said.

“However, we are certain that with sufficient industry consultation and collaboration, a solution can be found that accommodates the department’s requirements, improves business conditions in our capital city, and does not further deteriorate an already fragile office market.”

Driving the concern is what impact a single building will have on office vacancy rates in the Top End which are at record highs. Vacancy rates in the CBD are at 22.5 per cent compared to the Sydney CBD which is less than 6 per cent and the Melbourne CBD which is less than 8 per cent.

“The short to medium term outlook for office vacancy rates are very poor. The property sector is predicting that vacancy rates will increase further, even if no new office space is constructed for the Health Department,” Ms Palmer said.

The Property Council has pressed their case in person to Ms Moss, whose department manages agency leases.

“We’re aware that commercial vacancies in the CBD are very high at the moment,” Ms Moss said.

“We understand the Property Council’s concerns. It’s key that we keep as many Government workers in the CBD as possible.

“The Government announced late last year that it would co-locate the Department of Health’s administrative staff in the Darwin CBD as part of plans to revitalise the CBD.

“Health staff are currently located across multiple sites and there is a need to bring them together to create muchneeded efficiencies and provide staff with suitable accommodation.”

Ms Palmer said the Property Council accepted consolidating the Health Department staff into existing refurbished buildings may create some challenges. But said: “Once this existing office stock is refurbished, the result will be improved market conditions that will likely spur additional construction activity in the long term. Currently, market conditions do not support additional commercial construction activity.”