The July 2018 Office Market Report, released by the Property Council of Australia, reveals Australia’s largest office markets are tightening. Australian CBD office vacancy rate decreased over the six months to July 2018, from 9.8 to 9.2 per cent, with all CBD markets recording a decline in their vacancy rates during this period. A market-by-market wrap is below:
Sydney CBD
The Sydney CBD office market continues to be one of the tightest CBD markets in Australia and has the lowest vacancy rate in over ten years with the vacancy rate dropping from 4.8 to 4.6 per cent in the six months to July 2018.
Melbourne CBD
Office market vacancy rate in Melbourne’s CBD has reached a 10-year low and is now the lowest of any Australian CBD. The vacancy rate dropped from 4.5 to 3.6 per cent over the six months to July 2018.
Brisbane CBD
The results for Brisbane CBD show a welcome return in market activity with vacancy across the CBD dropping from 16.1 to 14.6 per cent over the last six months. The fall in vacancy can be largely attributed to increased tenant demand, while there has also been withdrawals at the lower end of the market.
Adelaide CBD
Adelaide’s CBD office vacancy rate has dropped for the third consecutive period falling from 15.7 to 14.7 per cent over the six months to July 2018. There has been a strong flight to quality in the Adelaide CBD with premium vacancy dropping to 2.8 per cent, the lowest vacancy level since July 2012.
Perth CBD
Perth CBD has passed its peak vacancy, recording a decline in vacancy to 19.4 per cent. However, Perth still has the highest vacancy rate of any capital city and is significantly higher than the national average of 9.1 per cent.
Canberra
Canberra’s overall vacancy rate decreased slightly from 13.2 per cent to 12.5 per cent over the six months to July 2018. The vacancy decrease was due to 65,368sqm of withdrawals and -25,755sqm net absorption.
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