The Property Council of Australia’s Office Market Report recently released has shed some light on the changing profile of the CBD and non-CBD office markets across Australia. The post-COVID-19 economy has been particularly challenging for some office locations, with many staff continuing to work from home. This shift has changed the nature of new take up of space and movement across regions.
The two largest areas hit by this change are Sydney and Melbourne’s CBDs, which have recorded negative net absorption and increased vacancy rates to 11.3% and 13.8% respectively. On the other hand, cities that were not subjected to stringent lockdown measures, such as Brisbane and Perth’s CBDs, remain positive with regards to space take up thus resulting in an improved occupancy rate.
Additionally, people are increasingly moving out of city centres into growing employment hubs that follow population growth trends, indicating a wider pattern across Australia’s property industry. Here’s what the report found for local markets.
The high population growth in Queensland is having a positive impact on the office market across the State. Brisbane Fringe recorded the second highest net absorption of all Australian office markets with 63,625m², making it the largest non-CBD office market in the country at over 1.3 million m² in stock. The region is improving due to people’s changing preference for parking and affordable, quality accommodation options.
Meanwhile, Brisbane’s CBD – the fourth largest one in the whole country – has recorded the greatest take up rate within the last 12 months with current vacancies sitting at 12.9% (lower than its 10 year average of 14.3%). This can be attributed to an increasing employment demand from population growth as well as businesses looking to expand or fill existing stock.
The Sunshine Coast and Gold Coast are also two strong performers that have both seen their vacancy rates falling to record lows due to population growth and new business starts. The Sunshine Coast vacancy rate currently sits at 4.0% while Gold Coast vacancy is down to 6.0% (the lowest since 2008). A-grade assets continue to be highly sought after due to limited new stock being added over recent years.
The evolving dynamics of the office market across Australia present both challenges and opportunities for investors and tenants alike. Whether you are looking to capitalise on the positive growth trends in Brisbane and its fringes, secure a prime location in a growing employment hub like the Sunshine Coast or Gold Coast, or need guidance on navigating the shifting landscape of Sydney and Melbourne’s CBDs, McGees Property is here to assist you.
For Investors: The post-COVID-19 environment is reshaping the commercial property market, with certain regions experiencing robust growth and others facing challenges. Now is the time to review your portfolio, identify strategic opportunities, and make informed decisions that will yield long-term benefits. Our experienced team at McGees Property can provide you with comprehensive market insights, property valuation services, and tailored advice to help you maximise your investment returns.
For Tenants: Finding the right office space that aligns with your business needs is more critical than ever. Whether you are expanding, relocating, or seeking better terms, McGees Property offers expert leasing advice and can help you secure a location that supports your business goals. With vacancy rates dropping in key areas, now is the time to act.
Contact Us Today: Let McGees Property guide you through your next investment or leasing decision. Reach out to our expert team for personalised advice on property acquisitions, disposals, financial reporting, or leasing opportunities. We are here to help you make the most of the current market conditions.
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