Perth CBD needs new vision to combat high vacancies


The Perth CBD needs a new planning and business attraction strategy to combat high office vacancy rates and the looming competition from expanding suburban activity centres.

Property Council of Australia WA Executive Director, Lino Iacomella said the CBD needs to follow the lead of other metropolitan localities, which have upgraded their commercial and economic development strategies to attract new business.

“The news that office vacancy rates in the Perth CBD are the highest in more than 20 years is a wake-up call to everyone with a stake in the city.

“A business as usual approach will not adequately deal with the stresses caused by a contraction in demand for office space by the resources industry, an influx of new office stock and the emergence of suburban activity centres that will compete with the CBD for retail and entertainment offerings.

“The latest Property Council Office Market Report revealed that the Perth CBD office vacancy rate in August 2016 reached 21.8%, which is double the national average.  The report also found that the very high vacancies were concentrated in older commercial buildings.

“Some initiatives that need to be considered, include:

  • New state and local government policies to facilitate conversions and upgrades of old commercial buildings;
  • Planning for new CBD precincts with a focus on established and emerging industries; and
  • A marketing plan to attract new CBD office tenants.”

 

“Most major Australian cities have faced similar problems and have implemented strategies based on a vision for growing the CBD.  The Melbourne strategy was based around CBD living and education, which had the flow-on effect of attracting businesses and retail traffic.

“The risk for Perth over the longer term is that a two tier office market emerges with higher occupancy rates in new buildings and precincts, and a dark-zone of low occupancy rates in deteriorating older buildings.

“Now is the time for action with the new City of Perth Act and we are calling on the City of Perth and key state agencies to work with the industry in preparing a fresh vision for growing the CBD,” said Mr Iacomella. 

 

Media contact:  Lino Iacomella  |  M  0417 501 974   |   E  liacomella@propertycouncil.com.au