Smart technology will be the catalyst for change in Adelaide’s office landscape, taking the same focus that sustainability and end of trip facilities did a decade ago.
CBRE Head of Advisory and Transaction Services Andrew Bahr said office landlords were looking beyond the traditional suite of offerings, to provide a more innovative and efficient experience for occupiers.
“With technology becoming more sophisticated and ever-changing, landlords need to look beyond the physicality of buildings, to how they can help drive greater efficiencies and a better customer experience for tenants,” Mr Bahr said.
“With sustainability and end of trip facilities now commonplace features in the office sector, the focus is now on how smart technology is the gateway for the next generation of buildings.”
Mr Bahr said although there was not a substantial pipeline of new buildings being developed in Adelaide, smart technology would be a trend that plays out in the existing market as well.
“Given Adelaide’s ageing stock profile, landlords in fact need to work even harder to remain competitive, best future-proof assets in lower market cycles and ultimately add value and drive efficiencies for occupants,” Mr Bahr said.
"In secondary buildings, smart technology can help uplift certain areas – whether this be building and lift access through smartphones or heat mapping, enabling a customer to better manage their office space.
“Office environments that offer a better user experience and allow for future innovation will ultimately win tenants over, therefore, landlords need to embrace the technology that facilitates this to really differentiate their product in what is a challenging market in Adelaide at the present. This is where demand is going – that is not changing.”
Speaking about investment in South Australia, CBRE Head of Research for Australia Stephen McNabb said capital injection in Adelaide would increase over the next two years as yield compression reaches its peak in Sydney and Melbourne, and investors now focus more on relative income yield as the main motivation for investment.
“South Australia’s improved economy, which has been gaining momentum over the past 12 months, is making Adelaide look more attractive – particularly given the yield spread over bonds in prime assets is nearly 400bp, nearly 200bp wider than Sydney,” Mr McNabb said.
The presentation also referenced CBRE’s latest Investors Intentions Survey – highlighting 30% of Asian investors list Australia as their preferred APAC destination for investment.
“Investors are looking for higher yield spreads which will push them to new locations - markets like Adelaide will come into the radar,” Mr McNabb said.
