Assisted Newmont Mining to renew one floor and surrender unrequired space at the Colonnade in Subiaco
Newmont Mining had a lease commitment over two floors in the Colonnade in Subiaco, with lease terms that were a relic of a previous Landlord favoured real estate market. Throughout the course of their initial lease, Newmont no longer required one of the two floors, and had subleased this to another resources company, adding another layer of complexity to their lease situation. With a full make good obligation meaning they would need to completely refurbish their current premises if they vacated, Newmont were unsure whether renewal or relocation would be most cost effective.
CBRE were appointed to provide an initial Strategic Accommodation Review for Newmont. Through this process, CBRE identified and explained Newmont’s lease obligations, completed a market search of relocation options, and provided a net present value cash flow for a renewal and relocation scenario to give Newmont a clear picture of their real estate options, with indicative costs and strategic recommendations. Following this, CBRE were appointed to implement their recommendation for Newmont Mining to renew one level in their existing premises. The end result of CBRE’s representation built significant advantage for Newmont including surrender of the floor no longer required, 20% rent reduction, over $1.6 million in incentive and reduced rent increases. Additional benefits were also incorporated into the new lease such as $150,000 worth of bathroom refurbishment, lease protection for services failure, first rights over expansion space, as well as a no make good provision which will save Newmont hundreds of thousands down the track. To put icing on the cake for Newmont, CBRE’s fees were fully reimbursed by the Landlord, so there was no out of pocket cost to Newmont for CBRE’s services.