Demand leads to decrease in Brisbane office vacancy

The Property Council of Australia’s latest Office Market Report has reinforced the Brisbane office market’s resilience, with both the Brisbane CBD and the Brisbane Fringe markets’ vacancy decreasing in the six months to July 2021.

Released today, the Office Market Report recorded Brisbane’s CBD vacancy rate decreasing marginally, from 13.6 per cent in January 2021 to 13.5 per cent in July 2021, and the vacancy in Brisbane’s Fringe market decreasing from 16.6 per cent to 16.1 per cent over the same period.

Jen Williams, Queensland Executive Director of the Property Council, said, “The figures show Brisbane’s office markets have fared remarkably well during these trying times.”

“Last quarter’s ANZ/Property Council Survey results showed an uptick in the property industry’s confidence, from 144 to 147 index points. This decrease in Brisbane office vacancy- despite the ongoing challenges COVID-19 presents- is yet another indication of the positive sentiment in the Queensland market,” she said.

“The above historical average demand for small to medium enterprise office spaces in the Brisbane Fringe markets are driving this positive market sentiment.

“Securing the rights to host the 2032 Olympics means that Brisbane’s golden decade of opportunity has begun, and as a result, we can expect this interest in office space to continue. This is our city’s chance to attract new businesses, which will bring along with them new talent and new investment in our commercial assets.

“While Brisbane office vacancy rates have decreased slightly and the future looks bright, in the immediate term, it’s not all smooth sailing for the CBD. Many retailers and hospitality venues are still hurting, as we once again find ourselves in lockdown, and employees are increasingly choosing greater flexibility in how they and where they work.

“To secure our city’s future and make the most of the opportunities ahead, it is essential that the retailers, hospitality and entertainment venues not only survive the lead up to the Olympics but thrive, so they can come out the other side and give people a reason to visit and stay.

“With the ongoing threat of lockdowns and impact of social restrictions, measures to support CBD revitalisation are more needed than ever.

“Following the overwhelming success of the Fridays in the City campaign (run in Brisbane CBD from 21 May- 25 June), over the coming weeks the Property Council will be seeking out further partnerships with landlords, Brisbane City Council and the State Government, to help attract workers back into the CBD and drive much-needed foot traffic in our retail assets,” Ms Williams said.

ENDS.

NOTE- Office vacancies are calculated on whether a lease is in place for office space, not whether the tenant’s employees are occupying the space or working from home.

ATTACHED: Brisbane, Brisbane Fringe office market analysis

Media contact: Jen Williams |  M  0448 432 936  |   E  [email protected]  

Office Market Report July 2021

Analysis – Brisbane CBD market

Headline comments:                                

  • Brisbane CBD vacancy decreased marginally in the six months to July 2021
  • This was due to positive demand
  • The positive demand is concentrated in the B Grade segment
  • There is some space projected to be added to the market over the next 18 months

 

Vacancy analysis:

  • Brisbane CBD’s vacancy rate decreased marginally from 13.6 percent to 13.5 percent
  • This was due to 1,411sqm of net absorption

 

Future supply:

  • 44,000sqm of space is due to come online in the second half of 2021
  • This will be followed by 58,449sqm in 2022
  • There is no future supply projected for 2023 onwards
  • 467,920sqm of space is mooted

 

Key market indicators, Brisbane CBD (aggregate)

Grade

Vacancy,

Jul 21 (%)

Vacancy,

Jan 21 (%)

Net absorption, 6 months to

Jul 21 (sqm)

Net absorption, 12 months to

Jul 21 (sqm)

Premium

8.1

6.8

-4,436

-10,153

A

13.2

13.2

131

968

B

14.8

16.0

8,872

4,687

C

17.5

15.7

-4,436

-7,072

D

22.8

27.1

1,190

555

Total

13.5

13.6

1,411

-11,015

 

 

 

Office Market Report July 2021

Analysis – Brisbane Fringe market

Headline comments:

  • The Brisbane Fringe market’s vacancy decreased over the period
  • This was due to positive demand
  • The positive demand was concentrated in the A Grade segment
  • All grades have vacancy above 12 per cent
  • More than twice the supply additions’ historic average is projected to be added to the market over the next 6 months

 

Vacancy analysis:

  • Brisbane Fringe’s vacancy decreased from 16.6 per cent to 16.1 per cent
  • This was mainly due to net absorption of 14,010sqm, above the historical average of 8,249sqm
  • Supply additions totalled 9,300sqm over the period

 

Future supply:

  • 35,966sqm of space is due to come online in the second half of 2021
  • This will be followed by 24,000sqm in 2022
  • 44,794sqm is due to come online from 2023 onwards
  • 144,438sqm is mooted

 

Key market indicators, Brisbane Fringe (aggregate)

Grade

Vacancy,

Jul 21 (%)

Vacancy,

Jan 21 (%)

Net absorption, 6 months to

Jul 21 (sqm)

Net absorption, 12 months to

Jul 21 (sqm)

A

12.2

13.4

15,499

3,390

B

20.9

20.5

-2,130

-29,486

C

16.1

16.8

1,171

3,493

D

43.7

37.0

-530

-236

Total

16.1

16.6

14,010

-22,839