Nicholas Building rent hike forces artists to consider new canvas

Nicholas Jones

For 90 years, the Nicholas Building on Swanston Street has been a hub for some of Melbourne’s best creative talents.

But rent increases in the order of 30 per cent may force a number of tenants to leave the building – and the city centre.

Sculptor Nicholas Jones, who makes his art from discarded books, said an increase of $100 a month – from $840 to $940 per month – means he will need to divide his space and find another tenant to make ends meet.

“If the rent increases continue, the small creative businesses which are crucial to the character of this city will move out and the city will lose out financially as well as creatively,” he said.

More than 100 artists who rent space in the Nicholas Building have been served with rent increase notices, with those with the best views on the southern side facing the steepest rises. Rents have more than doubled over the past decade, nothwithstanding major renovations and improvements to the building.

One long-term tenant, who asked not to be named, paid $725 a month in 1994. From August 1, he faces a monthly bill of $2222, up from $1679.

Stephen Giblett, a painter who has been in the Nicholas Building for 10 years, said he is left with no option but to move out, as his rent has more than doubled in the past decade.

“I will be forced to downsize at a time in my career when I would hope to expand. I do not know exactly where I will be going after this,” he said.

“I was notified in a letter that rent was being adjusted to suit the market value of the property. I do not accept their recent increase as fair, as I would hope that it would happen more gradually.”

The heritage-listed Nicholas Building was designed by architect Harry Norris and completed in 1926. It was modelled on US commercial buildings of the period, drawing influence from Renaissance palazzo form and Greek revival styling. It is noted for its hybrid structure that includes a glazed leadlight barrel vaulted arcade at ground level that makes up the Cathedral Arcade, linking Swanston Street and Flinders Lane.

The building’s well-known lift attendant, Joan McQueen, retired after 35 years in 2012. Since then, there have been significant renovations including replacing the ageing elevators, improving security and completely renovating the bathrooms.

Some of its famous tenants have included the late Vali Myers and author Gregory David Roberts, who wrote Shantaram there.

Melbourne City councillor Rohan Leppert said the council would like to see the building retain its position as a “supportive and affordable space for artists” but said the council cannot compel private landlords to cap rents.

Some tenants have accepted the rent increases as “reasonable”. Stephen McLaughlan, who has had his eponymous gallery in the building for 20 years, said the Nicholas Building was pretty empty when he moved in and rent was “cheap”.

“It is now virtually full and rent is closer to market levels. Recently the lifts and toilets have undergone major, necessary upgrades. Security and technology issues have been addressed. All have been done in accord with UNESCO heritage conventions and with architectural flair – I have been impressed.”

He said the best way to ensure its future as an arts hub was for Melburnians to support the artists who work there.

“If Melbourne [residents want] their galleries, bookshops, milliners and the like to survive and prosper – be our customers so we can pay our overheads.”

Article first published in Saturday Age

One thought on “Nicholas Building rent hike forces artists to consider new canvas

  1. Hi James

    In response to your article on the Nicholas Building (the Age 12/ 7/2014 ) I would like to make a couple of points. As a tenant in the Nicholas Building I have written to both the Melbourne City Council and the estate agent at the Nicholas Building to express concern at the recent rent increase. While I have had responses to both these letters there are a number of omissions and points to be made in relation to this issue which have only partially been addressed in the letters of response and in your article.

    Most of the tenants in the Nicholas Building are there because of historically affordable studio rental price points. The Nicholas Building is unique in that it has a long and I think valued history as an organic creative community located directly in the Melbourne CBD which you point out in your Age article.

    Artists have increasingly been forced out of the city centre due either to redevelopment or steadily increasing rental values. However it is the size and seeming frequency of big jumps in rent without much notification or consultation that are becoming a real concern for the tenants of the Nicholas building. The tenants are operating on relatively small margins based on what has historically been considered an affordable rental cost. Such increases are basically untenable for artists and creative people in the long term regardless of the validity of an assessment of ‘market value’ which probably has no realistic limit or ‘improvements’ e.g. essential repairs to the building. While upgrades to security have been increased some exhibition spaces have had to hire lift attendants at there own cost because of shortened hours of operation.

    Tenants are on month to month license agreements with many established tenants now renting on these agreements for extended periods, in some cases up to 20 years. As I have pointed out to council and the Nicholas Building management the license agreement does not represent any security of tenure or protection for the artists, designers, galleries and craftspeople in the Nicholas building.

    The license agreement was potentially an arrangement that worked in the past when rents remained relatively low or were at least stable and linked to a percentage rise. But when the rents are increased to ‘market rates’ at very short notice then it becomes apparent that there is no security or protection from large increases at any time and no mechanism in place within which to discuss or negotiate such changes. Understandably such a situation has an adverse effect on any small cottage industry, artist-run space, artist , craftsperson , designer etc (which makes up the the Nicholas Building tenancies) on a tight margin or budget. It affects the ability to clearly plan ahead, to budget and program for projects or exhibitions as the case may be. Increased audience or public support through sales may affect some tenants bottom line as Stephen Mclaughlan suggests but his gallery model is based on charging artists a fee to exhibit, so costs can again get passed back to the artist. It does not change the fundamental issue of the inequity of short term contracts, the lack of security of big jumps in rent and a clear short to longer term stability in planning for the tenants in the Nicholas Building. The size of the rental increase in this context is neither fair or reasonable.

    This is a major issue that is not being addressed and is of concern to many tenants. In response to a letter to the Melbourne City Council to raise these concerns it has been suggested that I look at other rental options such as the City Council Creative Spaces. Notwithstanding the waiting lists for these spaces, they have been designed from the outset as temporary studios (also with one month license agreements) which are to be redeveloped. They are also part of a collaborative financial arrangement between the City of Melbourne, developer and owner. The Nicholas Building is similar in that it is privately owned but I would argue that it too deserves to be considered as worthy of a potential partnership arrangement. It is in many ways a prototype of the model of the ‘creative space’ that the Melbourne City Council consistently claims to support in its arts strategy.

    The Nicholas building has a rich and organic history. It is the last centrally located buildings in the city centre that houses artists, designers and craftspeople in an arrangement that allows for a natural interaction with the public and between artists. It is a unique part of the city of Melbourne’s creative culture. The continued application of market forces to such a community will ensure its eventual decline and loss of diversity. Business and other industry sectors receive many millions of dollars in subsidies from the state of Victoria. As the City of Melbourne benefits from the Nicholas Building, using it in promotions, claiming it as an example of the city’s investment in art and culture and encouraging artists into the city centre it should be seriously considered as a resource and a potential partnership opportunity within which to further develop and invest in Melbourne’s cultural capital.

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