In a historic move, listed plumbing supplies firm the Reece Group will shift its headquarters from the suburbs to Zig Inge’s new building on the historic Rosella complex in Cremorne.
Reece moved to its Burwood headquarters in 1986 and has been in the suburbs since its founder sold plumbing supplies from the back of a truck in 1920.
The 98-year-old company will move to its new seven-level Cremorne digs at 57 Balmain Street in 2020, its centenary anniversary.
Cremorne, south of Swan Street to the Yarra River in Richmond, is one of the fastest growing office areas in the country. MYOB recently signed a deal to occupy an 8800-square-metre office building developed by Joe Russo’s Caydon Property.
The REA Group, Carsales, Uber and a host of other tech-related companies and co-working spaces dominate the area which has been dubbed “silicon Richmond”.
Reece’s workplace transportation lead Lizzy Geremia said the decision to leave the suburbs was motivated by a need to retain staff and “future-proof” the company.
Reece occupies 4400 square metres at 118 Burwood Highway in Burwood on a large site it shares with a large Reece showroom and warehouse, Ms Geremia said.
“What came up again and again was the current support centre in Burwood was not going to future-proof the organisation,” she said.
“Our people wanted an amenity-rich neighbourhood and Burwood isn’t amenity-rich. People are very car dependant out here and they wanted to be closer to public transport. So we had to change.”
“We have a national network but our roots are here in Melbourne. We wanted somewhere granular and real and Cremorne kept coming up,” she said.
“We wanted to be a sole occupier so we could customise the building and a minimum 10-year lease so we could realise commercial benefits,” she said.
Zig Inge paid $12.5 million for the old Rosella site in 2016. It won a permit to build on top of the historic red brick building in January.
While the proposed 7500-square-metre building is on the railway line, close to stations and trams, it is also near the Monash Freeway entrance and will have three levels of basement car parking to service the Reece salespeople.
Cremorne’s transformation into a specialised commercial precinct is moving quickly. A-grade rents are fetching more than $500 a square metre and capital values have more than doubled in five years.
Observers are keenly watching the newest potential development site on the market. Two buildings on 1750 square metres nearby at 116-124 Balmain Street are expected to fetch about $20 million. On two titles, the properties cost a combined $6.4 million between 12 and 15 years ago.
CostaFox recently purchased an 1180-square-metre site at 1-11 Gordon Street for $12 million on which it expects to construct a new office building.