Australian CBD Office Overview
An overview of the leasing and investment markets in the key CBD markets of Australia
Key Leasing Market Trends
- Occupier demand has strengthened. Over the year to July, the vacancy rate declined across all CBD office markets and net absorption strengthened in most markets.
- There has been strong demand from the Professional Services and IT industries.
- A strong national pipeline of infrastructure works and major projects has boosted white-collar employment and office space demand.
- Co-working providers have continued to expand their national presence and have accounted for a large share of demand for new office space in a number of Australian markets.
Key Investment Market Trends
- Investors are paying increased attention to tenant profile, looking to avoid / re-position assets heavily leased to tenants from industries susceptible to technology-induced disruption.
- Foreign investors have continued to increase their presence in the investment market due to the stable investment environment, the favourable spread between Australian property yields and government bonds, the value of the Australian dollar and more desirable lease terms in Australia than across the remainder of the Asia Pacific.
- Yields have continued to tighten, albeit at a slower rate than seen over previous years.