Sydney skyscraper numbers set to grow

Sydney skyscraper numbers set to growSydney’s skyline will include an expanding number of skyscrapers in coming years, and they look set to generate higher rental returns, according to Knight Frank’s ‘Global Cities: Skyscrapers 2015 Report’.The latest research from Knight Frank ranked Sydney seventh among a list of global cities for its high-rise buildings. The list took into account several factors, such as office rents and yields, the spread offered by investment yields compared with national bonds, the number of high-rise buildings built, and each city’s growth prospects. Hong Kong, New York and Tokyo took out the top three positions, followed by London, San Francisco and Singapore.The research indicates that cities around the world are undergoing a high-rise building boom and that skyscrapers offer the best opportunity for global cities to address the significant economic and geographic challenges facing them. The report identifies five key trends that are driving cities upwards: the emergence of new technology making skyscrapers possible and cost effective; the desire of people to live in inner-city locations close to their places of work; the propensity of companies to ‘cluster’; the desire to limit urban sprawl; and the rise of CBD areas as vibrant hubs offering shopping, eating and entertainment options beyond office hours.Sydney, the report suggests, is experiencing these trends and can soon expect to see increased office tower rents as a result. John Preece, Knight Frank’s head of Office Agency for Australia, says: “From a commercial perspective, landlords can charge higher rents for upper floors, which could support the commercial position for high-rise development. Rents in Sydney’s premium towers are also increasing.”Preece says Australia’s generous amount of land has previously allowed for urban sprawl but changing demographics are generating the need for higher-density CBDs.”Land availability is now drying up and we are seeing office buildings being withdrawn for residential development, reducing existing office space and the ability to develop more stock,” he adds. “Consequently, we will soon be left with no option but to go high.”Download Global Cities: Skyscrapers 2015 Report.