Helping shape Australia's cities for competitiveness and as desirable places to work and live

Shaping our urban future

We take an active role in shaping the cities in which we operate through creating connected liveable and resilient communities. Our approach towards leading cities involves:

  • Developing world-class office buildings that deliver customer-focused, sustainable workplaces and which enhance the amenity and vibrancy of CBDs
  • Contributing to sustainable cities by integrating sustainable outcomes into our developments
  • Building symbiotic city partnerships through collaboration with leading city think tanks and industry associations
  • Conducting ongoing research to be able to anticipate future trends in our key CBD markets

With Australian cities just one third of their way through a 100-year cycle of urbanisation, we are adapting to evolving cities by progressing mixed-use developments, in turn benefitting the wider community.

In addition to progressing office developments within our existing pipeline (refer the next page for more detail), this year we enhanced leading cities with the announcement of new city shaping concept project proposals.

In Brisbane, the Queensland Government endorsed Dexus’s Waterfront Precinct proposal to progress to the next stage under the Market-Led-Proposal Program.

The plan is to revitalise Brisbane’s premier dining hub and create a traffic-free precinct that delivers a global-standard business address and tourist destination in the heart of the CBD.

Continuing this momentum, we progressed plans for major city shaping precinct developments in Sydney at 201 Elizabeth Street and Henry Deane Plaza, Central.

At 201 Elizabeth Street, the City of Sydney has approved removal of the existing office building and redevelopment into a 50-storey mixed-use hotel, retail and residential building overlooking Hyde Park. Clever site planning will achieve a 50% reduction of the building’s shadow cast on Hyde Park. There is also an opportunity to enhance the vibrancy of the precinct through new retail amenity.

The NSW Government has provided approval to progress a proposal by Dexus and Frasers Property Australia to redevelop the Henry Deane Plaza at Lee Street, Central to the next stage under the Unsolicited Proposals process. The proposal is for a large scale mixed-use development integrating a transport and pedestrian access solution.

This mixed-use development opportunity offers the potential for superior urban, transport and connectivity outcomes, and presents a unique opportunity to integrate Transport for NSW’s plans to revitalise Central Station, complementing the State Government’s vision for a new technology and innovation precinct.

Delivering FY18 leading cities commitments

 = Achieved   = Not Achieved   = Underway

Commitment Status FY18 achievements
Improve the vibrancy of nine CBD spaces through the redevelopment of nine city retail spaces, providing customers and the surrounding community with reasons to engage, over a three-year period 2015-2018 Completed the redevelopment of five city retail spaces, and progressed a further four, providing customers and the surrounding community greater engagement and vibrancy.
Collaborate with stakeholders to invest in the cities of the future by unlocking potential value and enabling sustainable urbanisation through the activation of six sites within the existing portfolio by 2022 Activated developments at four sites and identified two further opportunities to unlock potential value and enable sustainable urbanisation

Transforming our future cities

Our cities are undergoing a transformation driven by various megatrends, underpinned by continued population growth and a record level of infrastructure investment.

This transformation supports Dexus’s strategic focus on CBDs as centres of value creation and the development of vibrant mixed-used precincts to cater for the needs of our customers.

Positioning Dexus as an investor in cities rather than buildings and evolving Dexus’s mixed-used capability will improve our ability to capitalise on the highest and best use of real estate and align us with the aspirations of our customers and metropolitan planners.

To this extent we are broadening our thinking beyond individual assets and adopting a precinct and city shaping vision.

Vibrant, experience-driven precincts will attract people and high-growth businesses for the following reasons:

  • People want to live-work-play in the one place, especially younger, high-skilled workers 
  • Landmark development projects
  • Creative/innovative firms and workers crave proximity seamlessly to enable the seamless exchange of ideas and knowledge
  • CBDs are seen as locations that attract talent

Key projects in the Dexus portfolio that respond to this vision include Waterfront Place, Brisbane, 180 Flinders Street Melbourne and Henry Deane Plaza, Central and 201 Elizabeth Street in Sydney.

Activating precincts

We take an active approach in creating leading cities through the activation of public areas of our CBD office properties, connecting properties within inspiring precincts, and attracting visitors through retail and dining experiences.

We progressed the development of 100 Mount Street, North Sydney, incorporating more than 15 smart technologies. In Perth, a redevelopment of 240 St Georges Terrace is underway to create a new street entry, enhanced amenity and an improved retail offering.

Development of 105 Phillip Street, Parramatta is complete and positively contributing to the growing Parramatta office market.

In Melbourne, we activated a development at 180 Flinders Street for a new office tower to be built over an existing carpark, delivering 20,100 square metres of new office space and retail and customer amenity.

The development will include a new A-Grade office space over the existing public carpark and the restoration of two existing buildings.

In Brisbane, we commenced the construction of a new office building, known as 12 Creek Street – The Annex. The building’s innovative design supports an exciting community atmosphere where occupant wellbeing is at the forefront.

Connectivity is enhanced through a lively public space connecting neighbouring buildings, laneways and streets.

The Annex aligns with Brisbane City’s 2033 vision for a new world city – creating buildings that breathe and bring a range of social and economic benefits to the community.

During the year we also completed city retail developments at Australia Square, Sydney and the Galleria at 385 Bourke Street, Melbourne.

 Waterfront Place precinct, Brisbane
Proposal for a mixed-use precinct including office, residential, hotel and public open space.
The Annex - 12 Creek Street,  Brisbane
Boutique office tower within Brisbane's
Golden Triangle
201 Elizabeth Street, Sydney
Mixed-use development including residential,
hotel and retail.
180 Flinders Street, Melbourne
High-quality office space, new retail and refurbishment of the historic buildings at 189 Flinders Lane and 180 Flinders Street.

Monitoring the pulse of our cities

Sound investment decisions require an in-depth understanding of real estate markets. To that end our in-house research team is an integral part of the decision-making process. Dexus Research actively monitors our key investment markets to track emerging trends, customer preferences and economic conditions to effectively manage market volatility.

Megatrends influencing sustainable cities

Dexus, our customers and the cities in which we operate are experiencing a climate of rapid change. Megatrends are changes occurring in the world which lead to large scale, long term shifts in patterns of growth, and create both disruption and opportunity. Megatrends will have significant implications for owners of real estate.

Dexus Research tracks emerging megatrends facing Dexus over the short, medium and long-term, in line with our Sustainability Approach themes of connectivity, liveability and resilience. Drawing on a wide range of local, regional and national datasets, we identify and assess the impacts of such trends.

Key megatrends and how Dexus manages and monitors them are outlined below.

Megatrend How Dexus is equipped to manage and monitor megatrends


The integration of capital, goods and services across national borders is driving increased connectivity between countries and cities, blending global cultures and business practices. As a result, businesses are seeking more flexibility in their working environments.

Dexus is responding to the growing demand from customers who seek workspaces that are flexible, collaborative and engaging through the launch of various initiatives including:

  • Dexus Place
  • Suite X, a new type of flexible workspace
  • Expanded suite offerings
  • Dexus simple and easy lease
  • Smart buildings connected to leading technologies

Shifting demographics and societal expectations

The ageing of the population, drift of people to coastal urban areas, increasing diversity in the workforce and influence of the millennial generation is impacting the way people work.

Dexus keeps abreast of the latest workspace trends and is responding to increasing preferences for ‘plug and play’ or ‘work anywhere’ environments.

Dexus’s smart building blueprint provides technology solutions that promote both connectivity across different spaces and flexibility in workplace locations.

Wellplace caters for the growing wellbeing trend in the workplace, providing a suite of health and wellbeing services and amenities.

For Dexus’s own workforce, the adoption of a flexible working policy allows our employees to work anywhere, anytime, supporting personal wellbeing and productivity.

Technological change

Technology and connectivity is driving mobility and collaboration in workplaces. Artificial Intelligence, automation and robotics is replacing repetitive tasks, together with a greater focus on the value of big data and analytics.

Technological advancement brings opportunities to further support our customers, and Dexus is implementing innovative technologies in new developments to deliver a better customer experience and optimise workforce productivity.

To support our employees, we are investing in systems and processes that will define how we operate as a business and create a foundation for operational excellence. This includes a new enterprise platform designed to enhance the efficiency of our day to day operations and reduce the operational demands on our people, enabling them to focus more on our customers.

Urban density

Population growth and increasing urban density in Australia’s major cities creating challenges for social equity, the environment, transport systems and city planning.

Dexus’s property portfolio is concentrated in the key CBDs of cities around Australia where our customers want to be, a circumstance that sees Dexus’s value and the future of our cities closely interrelated.

Dexus is creating vibrant hubs with spaces that offer a sense of community and high amenity which are well-connected through technology and transport.

We are conscious of the impact of our operations on the environment and we are embracing new technologies and new energy sources to provide energy efficient workspaces.


As the world becomes more urbanised, demand for energy, food and water will rise, putting pressure on supply of resources, waste management and the wellbeing of people.

Over the past decade, we have focused on energy efficiency as well as reducing the group’s greenhouse gas emissions and environmental footprint.

As Australia continues its search for secure, affordable, and environmentally conscious energy, Dexus has made progress on the transition to a low carbon future. Our New energy, New opportunities strategy sets a pathway for Dexus to achieve net zero emissions by 2030 through improving energy efficiency and increasing renewables.

Dexus Research publications are available at

Empowering customers through knowledge-sharing

In May 2017 Dexus launched Prism, an online hub providing insights and information as a resource for Dexus customers. Customers are encouraged to use this information resource on a regular basis and invited to subscribe to updates. Refer to our website at

Prism has enjoyed a successful first year with almost 1,000 subscribers and 82 articles published on topics such as workspace insights, megatrends, sustainability as well as market updates from Dexus Research.

Celebrating our cities and communities

Dexus participates in city and regional events and festivals and activates its precincts and lobby spaces for customers and the broader community.

Once again, Dexus collaborated with Destination NSW to celebrate the 2018 Sydney Vivid festival of light. Grosvenor Place featured prominently in this year’s event with a light show held in the building’s Piazza.

Each night during the festival, Grosvenor Place was dressed in vibrant colour to join the Sydney Harbour Bridge and other Sydney landmarks in the creation of Iain Reed’s Skylark artwork.

In October 2017, Australia Square showcased the best that Sydney in Spring has to offer, hosting night markets across two evenings of live music, food stalls and cocktails. Visitors were treated to pop-up stalls selling an eclectic selection of sweet, savoury and spicy dishes from all around the world, along with live Latin and Flamenco guitar beneath glowing festoons strung up in the plaza.

We also hosted visitors at 480 Queen Street, in conjunction with Brisbane Open House, opening the building’s doors to display its award-winning architectural design and unique in-building public park.

Grosvenor Place transformed for the Sydney Vivid festival of light   Interior at 480 Queen Street, Brisbane
Enhancing the Perth CBD through shopping centre repositioning 5 Martin Place, Sydney recognised 

Dexus is repositioning Carillon City into a vibrant retail, dining and entertainment destination in the Perth CBD, enhancing amenity for the local community and visitors alike. 

Carillon City, Perth was acquired by DWPF in October 2016, providing a value-add opportunity. In June 2018, Dexus secured development approval for the refurbishment of Carillion City, including approximately 14,000 square metres of retail space to include:            

  • a mix of destination and unique brands
  • an array of quality casual dining experiences

The HOYTS Group was secured to provide a new nine-screen cinema complex offering the latest technology and premium experience.

The transformation of Carillon City will deliver a modern, connected retail and leisure experience to further complement the investment that is underway across the Perth city centre.

During the year 5 Martin Place, Sydney was awarded winner of the Office Development category for Australia at the 2018 Asia Pacific Property Awards.

This accolade continues the international recognition received by the flagship re-development, which has now won 20 awards for its preservation of the heritage structure and integration within a contemporary design, assisting to revitalise the Martin Place precinct.

Collaborating to create shared value

Building city partnerships

Dexus helps shape the cities in which we operate through active engagement with local government and business groups.

Dexus is a founding member of the Sydney-based Better Buildings Partnership (BBP) that brings together property managers to collaborate on improving environmental performance and value chain relationships.

During the year Dexus’s Head of Sustainability and Energy, continued as Chair of the BBP Leadership Group which forms the strategy for the BBP initiatives.
The BBP achieved a major milestone in FY18 achieving 52% emissions reduction and 43% energy reduction when measured against its 2006 baseline, avoiding 1.1 million tonnes of carbon emissions in the 2017 calendar year. Dexus is a key contributor towards the BBP’s goals due to our size and scale of property management in the Sydney CBD.

We continued to support BBP initiatives and collaborate on developing industry leading guidance. We are in the second year of implementing the BBP’s ‘strip out’ waste guidelines within tenancy de-fit projects. Dexus’s goal is to consistently meet an 80% waste recovery rate and has made significant progress towards this, achieving our goal across 11 of 17 projects to date.

Dexus continued to actively promote customer energy efficiency programs such as City Switch, and other programs such as the 2018 Earth Hour campaign.

Childspace wins ‘game changer of the year’

It started with an idea submitted in our innovation ideas
system, The Funnel, and developed into an industry-first
customer initiative known as Childspace.

An innovative partnership with Guardian Early Learning
to offer priority access to childcare spaces for Dexus
customers and their staff at any of Guardian's 90
centres nationally won the Game Changer of the Year
Award at the REA 2017 Excellence Awards.

Childspace is an initiative provided to our customers
through Dexus Workspace, our suite of services
designed to make customer experiences simple and
easy. Through Childspace we offer priority access to
childcare spaces to customers in Dexus buildings,
supporting an easier transition back to work.

The Dexus-Guardian partnership is a unique
agreement that is both innovative and first to market
within the commercial property sector.


Lending our voice to issues affecting our cities

Across Dexus, passionate people contribute their time to collaborate with industry groups at both national and regional levels, contributing to public policy debate on issues that impact the future prosperity, liveability, connectivity and resilience of our cities.

Dexus actively engages with the Property Council of Australia (PCA) through group initiatives and regular advocacy. Darren Steinberg, Chief Executive Officer continued his role as a member of the PCA Board, and in addition 29 Dexus team members participated in PCA committees, roundtables and working groups contributing to discussions on topics such as social and environmental sustainability, diversity, and future directions.

As an example, in May 2018, Paul Wall, Head of Group Sustainability and Energy participated in a panel discussion at the PCA’s business lunch, Powering Australia: Our Energy Landscape. Other panel members included Dr Kerry Schott AO, Independent Chair, Energy Security Board and Audrey Zibelman, Chief Executive Officer and Managing Director, Australian Energy Market Operator.

Dexus also continued to support the Green Building Council of Australia (GBCA) and during the year became a Carbon Positive partner to the GBCA’s Carbon Positive roadmap.

The roadmap clearly outlines the high-level outcomes, actions, targets and policy positions required. These are proposed alongside changes to the GBCA’s Green Star rating tool to ensure it helps lead industry through the next decade of transformation.

Stewart Hutcheon, Executive General Manager, Retail and Group Marketing represents Dexus as a Board Member for The Shopping Centre Council of Australia, which advocates on behalf of investors and managers of, shopping centres.

Locally, Dexus actively engaged across forums including local chambers of commerce, The Committee for Sydney, the Committee for Perth, and Brisbane Marketing, contributing to advocacy for initiatives that will positively shape cities and their communities.

During the year, Dexus senior leaders and subject matter experts presented or participated in panel discussions at industry events and conferences, providing views and insights on market trends and sustainability issues.

Topics included the global investment landscape, customer trends, gender equality, evolving technology in our buildings and cities, and environmental issues including climate change.

Leading Cities – Performance data

Market outlook

Broad-based economic growth is supporting positive occupier demand for space across the office and industrial sectors in Australia.

Investment climate

Economic growth experienced across Australian states over the past few years is rebalancing, with Queensland and Western Australia forecast to catch up to Victoria and New South Wales over the next couple of years. While buoyed by infrastructure investment, Victoria and New South Wales may face some headwinds in FY19 and FY20 as weakening housing construction drags on employment growth.

The cost of capital remains low, continuing to support investment demand for real estate. The maintenance of reasonably wide spreads between real estate yields and government bond yields has supported investment activity to date in a maturing pricing cycle. Over time, pricing will be sensitive to a normalisation of interest rate yields, however such rises appear to be some way off.

Industrial markets

The industrial sector is in a growth phase with demand running ahead of supply. Demand is expected to remain solid in the year ahead given population growth and infrastructure investment are supporting economic activity. Sydney, Melbourne, and to a lesser extent Brisbane, are well placed to benefit. E-commerce is emerging as a significant driver of demand as online sales expand at double digit growth rates, and online retailers and fulfilment providers seek to increase scale.

The outlook for rents is likely to remain positive, particularly in land constrained areas in Sydney and Melbourne. Conditions in Brisbane are expected to continue to improve in the short term as the economy rebounds, while Perth appears to have bottomed.

Office markets

The performance of office markets is influenced by the strength of the broader economy and business confidence, the supply and demand characteristics of particular CBD markets and the leasing characteristics of individual properties.

Office markets continue to perform well. Modest levels of supply in Sydney and Melbourne helped push vacancy rates lower to circa 4.5% and we expect further falls with vacancy expected to fall below 3.5% in Sydney in FY19. Perth continued its recovery while the overall Brisbane market showed mild improvement.

The outlook for office demand is positive in the short-term due to solid employment growth and positive business confidence. The outlook is for mild upward pressure on rents in the short term in Sydney and Melbourne, with growth declining on a two to three-year timeframe as new supply materialises.
A key theme for office markets is growth in small office users as service firms shift to more collaborative, outsourced modes of working and the IT sector continues its mini-boom built on mobile applications, big data, fintech and social media.

Sydney CBD

Sydney continues to perform strongly with prime gross effective rents increasing by more than 12% over the past year. The outlook appears favourable in the short term given solid demand and a constrained supply pipeline which will push the vacancy rate lower in the year ahead. Solid demand and low vacancy will support rents over the next 1-2 years with the majority of new supply not expected until FY22-24.

Melbourne CBD

Melbourne is benefiting from economic fundamentals, recording strong net absorption in FY18 which has pushed the vacancy rate lower to 4.6%. In line with improving vacancy, prime net effective rents have increased by more than 12% over the year. Supply is projected to increase in FY19, however, strong demand and solid levels of pre-commitment means that the market is well placed to absorb the new supply.

Brisbane CBD

The Brisbane CBD appears to be in recovery mode with another year of mild but positive net absorption in FY18. The total market vacancy rate is 14.4% and Prime Grade vacancy under 10.0%. Speculative supply will keep pressure on rents in the short term, however some mild rental growth is projected in FY19 due to improved demand.

Perth CBD

The Perth market continues to show signs of improvement with demand expanding by over 32,000 square metres in FY18. Solid demand and limited supply has supported a decline in the vacancy rate to 20.9%. Demand is expected to remain positive on improving market conditions and mild rent growth is likely in FY19.