DEXUS Barometer records solid take-up of office space

DEXUS Barometer records solid take-up of office spaceThe DEXUS Office Demand Barometer is up slightly for the March 2015 quarter, indicating a positive outlook for tenant demand in Sydney over the next six months. DEXUS’s Barometer, which indicates conditions for future demand for Sydney CBD office space, was up slightly to 1.6 per cent in June compared to 1.5 per cent recorded for the March 2015 quarter.The Barometer includes five variables selected for their high correlation with Sydney CBD office demand. These include the S&P/ASX 200 Index, NAB Business Confidence Index, ANZ job advertisement series, US ISM Manufacturing Index and short-term business travel departures.”A lift in Australian business confidence over the past few months is a positive indicator for office demand,” explains Peter Studley, DEXUS’s general manager of research.”Job advertisements also continued to rise, reflecting a firmer labour market and a willingness by service sector firms to hire.”Another positive sign was the increase in overseas business departures.DEXUS says the Barometer was “somewhat constrained” by a fall in the Australian share market as a result of uncertainty around Greece’s future in the Eurozone, as well as from falls in China’s share markets.The report finds that the Sydney CBD office market is “well into recovery phase” as actual demand continues to firm.”It is pleasing to see solid leasing demand for prime office buildings in Sydney. According to JLL Research, take up of prime space in Sydney CBD totalled 158,000 sqm in the last financial year, the highest level in eight years,” Studley says.Also indicating improving demand, DEXUS recorded an increase in leasing enquiry across its Sydney office portfolio in the June 2015 quarter compared to the March 2015 quarter.