The Urban Developer
AdvertiseEventsWebinarsUrbanity
Industry Excellence
Urban Leader
Sign In
Membership
Latest
Menu
Location
Sector
Category
Content
Type
Newsletters
Urban Leader Awards Logos RGB White
NOMINATIONS CLOSE SEPTEMBER 12 RECOGNISING THE INDIVIDUALS BEHIND THE PROJECTS
NOMINATIONS CLOSING SEPTEMBER 12 URBAN LEADER AWARDS
LEARN MOREDETAILS
TheUrbanDeveloper
Follow
About
About Us
Membership
Awards
Events
Webinars
Listings
Resources
Terms & Conditions
Commenting Policy
Privacy Policy
Republishing Guidelines
Editorial Charter
Complaints Handling Policy
Contact
General Enquiries
Advertise
Contribution Enquiry
Project Submission
Membership Enquiry
Newsletter
Stay up to date and with the latest news, projects, deals and features.
Subscribe
ADVERTISEMENT
SHARE
13
print
Print
OtherTaryn ParisTue 29 Jun 21

Office Deals Double in Melbourne CBD Market

0599b158-04dd-4d0b-8b7b-93fb9e3eb41a

Melbourne’s office market is back in business, according to JLL’s preliminary results for this quarter showing almost $1 billion in sales, double the previous quarter’s transactions.

JLL recorded $985.9 million for the second quarter of 2021, almost double the previous quarter’s $412.5 million, in a sign the market had become buoyant.

The research shows this has been the strongest quarter for the Victorian commercial office sector transactions since 2019, before the Covid-19 pandemic sent the state into a series of lockdowns.

JLL senior director of capital markets Josh Rutman said they had appointed three new commercial sales agents to meet demand in the sector.

“The Victorian commercial property market has become increasingly buoyant as demonstrated by recent transaction volumes,” he said.

Despite strong investor sentiment in Victoria’s commercial sector, research from Cushman & Wakefield indicates CBD office rents are at their lowest ebb, but the decline has started to slow.

The Cushman & Wakefield’s Office MarketBeat for the second quarter shows that Melbourne’s CBD prime net effective rents had declined marginally to $382 per sq m, a year-on-year decrease of 11.6 per cent.

Average net incentives also continued to move upward, from 39 per cent to 41 per cent, the slowest growth rate since 2019, and placing downward pressure on net effective rents.

Prime net effective rent

YearQuarterMelbourneSydneyBrisbane
20201455875330
20202430775325
20203420735325
20204410710325
20211395685295
20212380665295

^Source: Cushman & Wakefield

Cushman & Wakefield head of research John Sears said incentives in the Sydney and Melbourne CBD office markets were “starting to settle”.

“While the pandemic is currently causing a temporary disruption in the gradual return of workers to the CBD, we continue to see healthy levels of leasing activity across the Eastern seaboard CBD and metro markets,” Sears said.

“We are seeing record business conditions, falling unemployment and rising investment intentions… [if] this cyclical upswing continues, we expect to see an overall increase in office demand in 2021.”

Southbank recorded a 9.3 per cent year-on-year decrease to $362 per sq m, while St Kilda Road dropped 14 per cent during the same period to $284 per square metre.

But Sears said research indicated a growing trend for workers heading back to the office.

Transport and pedestrian count data showed Canberra was the most advanced in its return to the office with usage in April of about 85 per cent of pre-Covid-19 levels, while Sydney, Melbourne and Brisbane CBDs were between 50 and 60 per cent of the 2019 average usage.

“Usage dipped in April due to the Easter break and a three-day lockdown in Brisbane, and the current Sydney restrictions will certainly have an impact, but otherwise there is a clear trend towards people returning to the CBD,” Sears said.

OtherOfficeAustraliaMelbourneSector
AUTHOR
Taryn Paris
More articles by this author
ADVERTISEMENT
TOP STORIES
Stockland bumps up its apartment pipeline in melbourne and sydney
Exclusive

Stockland Re-Enters Density in $5bn Apartment Play

Renee McKeown
4 Min
Woolloongabba Precinct Vulture St
Exclusive

Brisbane Developer in Cross River Rail Compensation Tussle

Clare Burnett
4 Min
The Mondrian Gold Coast hotel's food and beverage is driving profits
Exclusive

Touch, Taste, Theatre: What’s Driving Mondrian’s Success

Renee McKeown
6 Min
Fortis’ display suites are designed as brand environments first, with tactile details and curated design to build buyer confidence before project specifics.
Exclusive

Relevant or Redundant: Will Tech Kill Display Suites?

Vanessa Croll
7 Min
Exclusive

Missing Heart: Why The Gold Coast Needs a CBD

Phil Bartsch
7 Min
View All >
JQZ Parramatta EDM
Residential

JQZ Plots 10-Storey Addition to Parramatta ‘Auto Alley’ Plans

Clare Burnett
The Adelaide purpose built student accommodation market is about to increase by 1058 beds with the State Commission Assessment Panel supporting two towers in the making.
Student Housing

Highrise Approvals Add 1000-Plus PBSA Beds in Adelaide

Renee McKeown
Stockland bumps up its apartment pipeline in melbourne and sydney
Exclusive

Stockland Re-Enters Density in $5bn Apartment Play

Renee McKeown
The property giant’s strategic shift to higher density is in full flight as details of two landmark projects are made pu…
LATEST
JQZ Parramatta EDM
Residential

JQZ Plots 10-Storey Addition to Parramatta ‘Auto Alley’ Plans

Clare Burnett
3 Min
The Adelaide purpose built student accommodation market is about to increase by 1058 beds with the State Commission Assessment Panel supporting two towers in the making.
Student Housing

Highrise Approvals Add 1000-Plus PBSA Beds in Adelaide

Renee McKeown
3 Min
Stockland bumps up its apartment pipeline in melbourne and sydney
Exclusive

Stockland Re-Enters Density in $5bn Apartment Play

Renee McKeown
4 Min
Aerial view of Caboolture and Bruce highway to Brisbane with Bribie Island Road crossing, Queensland, Australia
Policy

Queensland’s $2bn Push Opens New Housing Front

Vanessa Croll
2 Min
View All >
ADVERTISEMENT
Article originally posted at: https://www.theurbandeveloper.com/articles/melbournes-office-market-back-in-business