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
print
Print
OtherStaff WriterTue 31 Jan 17

Office Market Gets 2017 Predictions

iStock_73545109_SMALL_620x380

The CBRE Q4 Office Market View report, which revealed Sydney delivered a rental growth of 5% at the end of 2016, continued with its analysis of the nation and provided a forecast for Australia's office markets in 2017.

[Related article:

One City To Lead Them All In Office Market Stats]CBRE Associate Research Director Felice Spark said national office vacancy peaked at 10.9% at the end of 2016, and provided the state-by-state analysis before offering some predictions for the coming year.
Melbourne
The CBD vacancy is forecast to have declined to 6.3% at the end of December 2016, with further declines expected this year given the modest supply outlook (with just 8,000 square metres of space anticipated to come on line as part of the Rialto regeneration).

However, supply is expected to pick up again in 2018 with the completion of 664 Collins and One Melbourne Quarter. During Q4 the Melbourne CBD recorded its fourth consecutive quarter of positive growth in net effective rents, with year over year growth being 7.2%
Brisbane
Ms Spark said economic improvement and limited supply over the medium term would drive the first green shoots of recovery.

"Despite this, CBRE’s forecasts are for CBD vacancy to remain elevated in the short term, with only a gradual recovery in underlying tenant demand and at least two further major tenant relocations to the near city."
Perth
Perth is expected to reach its cyclical bottom during 2017, with leasing activity having picked up and the pace of rental decline having eased over the course of 2016.

Ms Spark said Q42016 was the first quarter of no rental rate softening following 14 consecutive quarters of decline.

"Lower rental rates and record high incentives have been driving tenant migration from suburban markets to the CBD in a flight to quality and this has seen the level of CBD leasing activity rise."
Canberra
After three years of declining white collar employment, Ms Spark said the market appeared to have entered into a strong growth phase, with sustained job growth likely to translate into positive demand for space.

"With Tuggeranong Office Park the only development underway, CBRE is forecasting the Canberra vacancy will decline to 7.8% by 2020.

"Tightening vacancy in the Civic precinct and the lower vacancy outlook is expected to lead to 5.5% compound annual growth in effective rents over the next three years," she said.
Adelaide
Leasing activity, which has been slow over the past 12 months, is expected to see an upturn over the next two years, with a higher volume of leases coming up for expiry.

"The increase in vacancy over the past four years, to an estimated 16.2% in December 20167, has caused landlords to drop rents and increase incentives, enabling tenants to affordably move from lower to higher quality accommodation," Ms Spark said.

"This has resulted in the prime market outperforming the secondary office market."
Sydney
CBRE data highlights that Sydney CBD net effective rents grew 25.5% in 2016, outpacing other metropolitan markets and also recording Sydney’s highest net effective rental growth in more than 20 years. This rapid growth had broadly made up for the effective rental declines recorded between 2013 and 2015, with further increases forecast this year.

OtherOfficeAustraliaReal EstateSector
AUTHOR
Staff Writer
"TheUrbanDeveloper.com is committed to delivering the latest news, reviews, opinions and insights into the best of urban development from Australia and around the world. "
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 >
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
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
JQZ Parramatta EDM
Residential

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

Clare Burnett
The Sydney developer is pushing ahead with a project it picked up following the collapse of Dyldam in 2020....
LATEST
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
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
JQZ Parramatta EDM
Residential

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

Clare Burnett
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
View All >
ADVERTISEMENT
Article originally posted at: https://www.theurbandeveloper.com/articles/office-market-gets-2017-predictions