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
OfficeMon 27 Nov 17

Sydney and Melbourne Lead the World in Office Rental Growth

sydneyhome

Sydney and Melbourne have again taken out the top two spots globally for office rental performance, leading the list for annual prime office rental growth in the 2017 third quarter.

JLL’s Q3 Global Office Index shows Sydney way out in front globally in the number one spot for annual growth over the last year. Sydney recorded 30.1 per cent annual growth in prime rents. Melbourne recorded 17.3 per cent year-on-year growth for the same period, pushing it to number two global.

US cities came in next, with San Francisco Peninsula in third at 12.9 per cent annual rental growth, New Jersey at 12.2 per cent and Portland in fifth spot at 10.4 per cent.

“Sydney has consistently featured in the Top 10 Global performers rankings for the past five years and Melbourne for the past two years," JLL Australia's head of office leasing Tim O’Connor said.

“Two years ago, Sydney ranked number one, while Melbourne was ranked fifth. While the Sydney story has continued on the back of centralisation, stock withdrawals and growth from the technology sector in particular, Melbourne is now following hot on the heels.

“The sharp reduction in vacancy that precipitated the upward pressure in Sydney and Melbourne rents has been amplified by the lack of available new supply coming on line in the short term. The number of options for larger space users in existing stock now means demand will be expressed through additional pre-commitment activity,” O’Connor said.

[Related reading: Melbourne Office Market a National Standout]

The index shows that rental growth for prime offices across the 125 major markets covered by the JLL Global Office Index continued to pick up pace in Q3 2017, rising by 2.7 per cent year-on-year.

This was significantly above the 10-year average growth of 1.6 per cent.

Momentum is expected to continue with above-average increases in 2018, with a projected uplift of 3 per cent for the full year 2017 and 2.3 per cent globally next year.

"Sydney and Melbourne effective rental growth was in double digit territory over 2016 and 2017. We expect that effective rental growth will ease back from this rate in 2018," JLL Australia's head of research Andrew Ballantyne said.

“Nevertheless, Sydney and Melbourne effective rental growth is projected to remain above 7 per cent in 2018 with the potential to be even higher if the competition for space exerts further downward pressure on leasing incentives."



JLL's November 2017, Global Market Perspective Office Index can be found here.

OfficeAustraliaInternationalMelbourneSector
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 >
South Melbourne social housing precinct
Affordable & Social Housing

South Melbourne Housing Precinct Revamp Takes Next Step

Leon Della Bosca
Stockland bumps up its apartment pipeline in melbourne and sydney
Exclusive

Stockland Re-Enters Density in $5bn Apartment Play

Renee McKeown
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
The two towers, of 35 and 34 storeys, help cement the SA capital’s growing status as the best place in Australia for the…
LATEST
South Melbourne social housing precinct
Affordable & Social Housing

South Melbourne Housing Precinct Revamp Takes Next Step

Leon Della Bosca
2 Min
Stockland bumps up its apartment pipeline in melbourne and sydney
Exclusive

Stockland Re-Enters Density in $5bn Apartment Play

Renee McKeown
4 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
JQZ Parramatta EDM
Residential

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

Clare Burnett
3 Min
View All >
ADVERTISEMENT
Article originally posted at: https://www.theurbandeveloper.com/articles/sydney-melbourne-office-rents-jll