Defence Department eyes a Canberra property market stimulus

The Defence Department is positioned to inject a massive stimulus into Canberra's property market as it considers a move into new offices.

Real estate agents have described the major ACT employer's hunt for up to 65,000 square metres in office space as the largest commercial leasing opportunity in many years.

Defence's $238.7 million lease will be up in 2022 at the privately-owned Campbell Park and other buildings around town, prompting a search for offices starting on Thursday. 

The department, Canberra's largest public service employer, wants either one or two buildings and will lease them for 15 years in a multimillion dollar prospect for developers and landlords.

Campbell Park Offices on Northcott Drive. The Defence Department could clear out after decades in the buildings.

Campbell Park Offices on Northcott Drive. The Defence Department could clear out after decades in the buildings.

Defence's needs, which include staying within a stone's throw of its offices in Canberra, could mean a new building to host its public servants.

Its appetite for floorspace - it wants a minimum of 30,000 square metres - also narrows its options among Canberra's existing building stock. The largest office building in the national capital outside Parliament House, the Sirius building in Woden hosting the Health Department, has 50,000 square metres. 

Defence's request for expressions of interest could signal the beginning of the end for its time at the ageing Campbell Park offices, purpose-built for the department before the 1980s and known to many Canberrans flying out of the city looking down at Mount Ainslie's south-eastern foot.

As leases expire in Australia's two largest cities, the department is also looking for up to 20,000 square metres of office space on a 10-year lease in Melbourne's city centre, and another 20,000 square metres either solely in Sydney's CBD or shared with Parramatta.

However the department said while it was approaching the property market for offices, it had not decided to relocate from its existing leased buildings. 

Even if Defence left its longstanding digs at Campbell Park, housing 2,200 staff including naval technical bureau personnel, the move might not be bad news for its owners Cromwell Corporation.

Colliers International director of government services office leasing, Michael Ceacis, said it was an opportunity for the landlord to refurbish the property and put it on the market.

The unused land at Campbell Park was prime real estate and could be used for new homes or mixed use buildings.

Defence's leases were scattered around Canberra and the expiry of some gave it the chance to consolidate and save money, Mr Ceacis said.

Professionals Australia's Dale Beasley, representing Defence engineers, scientists, ICT and technical professionals, said the union was concerned about a possible move from Campbell Park.

"Given the national security implications, these workplaces require sophisticated ICT and telecommunications so that our members can work collegiately, in situations where the people they work closest with may be two states away," he said.

"The engineers, scientists and technical professionals who'll be impacted by these office relocations are already under a lot of pressure.

"Relocating workplaces can be extremely stressful and time consuming at the best of times, let alone when you're under incredible pressure as part of a reducing workforce.

"If office relocations go ahead, Defence must get them right the first time, they cannot afford to have the Defence capability that our members underpin put on standby while they shuffle boxes on the moving trucks."

Campbell Park is a centre for office and administration workers, but the site has previously hosted a weapons range once used for Defence training. The site also had four underground storage tanks storing heating oil, and diesel.