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It makes sense – Qantas is looking to consolidate its many corporate locations to cut overheads, so it may have to move some of its aviation facilities. But where will it go?

The answer may depend on which state makes itself most inviting. The airline is open to offers. It has included an expression of interest process for state governments in its current location review.

Qantas’ home for more than 20 years has been in Sydney’s Mascot, while budget subsidiary Jetstar is based in Victoria’s Collingwood. Aviation facilities are spread around, including heavy maintenance facilities in Brisbane.

The Qantas Group has confirmed it’s reviewing the location of its key facilities as part of its recovery plan – “which may result in bringing together several facilities, currently spread across Australia, in one state”.

Despite being established in Queensland as the Queensland and Northern Territory Aerial Service in 1920, the airline has called Sydney home since 1938.

Qantas has already put two buildings at its headquarters near Sydney Airport up for lease as a result of the economy drive, according to the Sydney Morning Herald. The paper reported that the standalone commercial buildings in Mascot – with between 2200 square metres and 20,000 square metres of corporate space – are being offered for immediate occupation as part of a sublease.

Other smaller offices in the Melbourne CBD and Hobart have also been earmarked for subleasing.

The Qantas review will focus chiefly on non-aviation facilities – including the national carrier’s leased 49,000 square metre head office in Mascot (Sydney) and Jetstar’s leased head office in Collingwood (Melbourne).

Qantas has confirmed: “Some aviation facilities will be considered for possible relocation, such as flight simulator centres currently in Sydney and Melbourne as well as Qantas’ heavy maintenance facilities in Brisbane – particularly if there is an opportunity to bring some or all of these facilities together elsewhere within Australia.

Will Qantas consolidate in Sydney? Here’s the airline’s uniform in the late 1960s. Source: Qantas

“There are no intentions to offshore facilities as a result of this review and it is not expected to have any impact on customers. Rather, the review flows from job losses already announced, (about 25% of which were corporate and head office employees) the need for more efficiencies and setting the Group up for the future.”

Chief financial officer for the Qantas Group, Vanessa Hudson, said: “Like most airlines, the ongoing impact of Covid means we’ll be a much smaller company for a while. We’re looking right across the organisation for efficiencies, including our $40 million annual spend on leased office space.

“As well as simply rightsizing the amount of space we have, there are opportunities to consolidate some facilities and unlock economies of scale. For instance, we could co-locate the Qantas and Jetstar head offices in a single place rather than splitting them across Sydney and Melbourne.

“Most of our activities and facilities are anchored to the airports we fly to, but anything that can reasonably move without impacting our operations or customers is on the table as part of this review. We’ll also be making the new Western Sydney Airport part of our thinking, given the opportunity this greenfield project represents.

“This is about setting the Qantas Group up for the long term as well as recovering from the Covid crisis. And we’re open minded about the outcome. It’s possible that our HQ stays where it is but becomes a lot smaller, and other facilities consolidate elsewhere. Or we could wind up with a single, all-purpose campus that brings together many different parts of the Group. These are all options we need to consider as we look to the future.

Qantas domestic B737-800. Source: Qantas

“The Qantas Group will remain one of the country’s largest employers and a major generator of economic activity, so we’re keen to engage with state governments on any potential incentives as part of our decision making,” Hudson added.

To assist with the first phase of consolidation, Colliers International has been appointed to sublease about 25,000 square metres of surplus office space across Mascot, Melbourne CBD and Hobart.  A lease on a 230-square-metre Sydney CBD office that is due to expire in October will not be renewed.

The review is expected to take three months to determine preferred options. Any relocations are likely to be staggered over time (potentially years) dependent on what options are taken up.

Qantas has moved about throughout its long history.

Qantas has been moved bases throughout its illustrious history. Above: Qantas pioneers in Queensland.

 

A SHORT HISTORY OF QANTAS’ HEAD OFFICE MOVES

1920 – Winton, Queensland

1921 – Longreach, Queensland

1930 – Brisbane, Queensland (various locations including the Wool Exchange Building)

1938 – Sydney CBD (Shell House, near Wynyard Station, which became part of the Menzies Hotel)

1957 – Sydney CBD (Qantas House, 1 Chifley Square)

1982 – Sydney CBD (Qantas International Centre, now Suncorp Place, on Grosvenor and Lang Streets)

1990s – Gradual shift over several years to current offices at Mascot, Sydney. This included relocation of Australian Airlines from Melbourne to Sydney after the merger with Qantas in 1993.

2004 – Jetstar relocates from Sydney to Melbourne

Edited by Peter Needham