Perth Office Sublease Space Drops to Five-Year Low

Sublease space in Perth’s office market has reached its lowest level in almost five years after dropping for the seventh consecutive quarter.

Perth's volume of sublease space decreased by 27 per cent during the third quarter of 2017, with just 42,383 square metres currently left available in the CBD market.

According to research conducted by CBRE, the reduction of 15,288 square metres was the largest single square metre quarterly reduction since 2012.

Sublease space in Perth’s CBD office market peaked at 98,304 square metre in December 2015.

CBRE’s Andrew Denny said an upturn in the state’s mining sector helped support business expansion in the Perth market.

“The major driver has been withdrawal of sublease space by the state’s resources sector, which has now reversed direction in regards to its office space utilisation,” Denny said.

“This is the seventh consecutive quarter of reduction in sublease space, with availability nearly back to what it was in September 2012 when the market first saw a change in direction.

Overall, Perth CBD office vacancy fell for the first time in nearly five years during the first half of 2017, from 22.5 per cent to 21.1 per cent.

“The latest figures are another key indication that the tide has turned in Perth’s office market. In particular, the scale and speed of the reduction in sublease availability is surprising, and points to a faster market recovery than expected,” Denny said.