Perth Office Market Report
The Property Council Western Australia held its first 2011 Office Market Report Breakfast on Thursday 3 February, with the presentation made by Greg McAlpine, National Director – Office Leasing, Knight Frank Australia.
Summarised from the presentation are the Report’s findings, as released by The Property Council of Australia on 3 February 2011:
Perth’s CBD office market vacancy rate dropped from 9.9 percent to 9.5 percent in the six months to January 2011, according to the Property Council’s latest Office Market Report.
CBD vacancies dropped despite significant supply additions of 30,115sqm over the period.
According to the report, demand for office space in the Perth CBD continues to exceed the long term annual average, with the market recording net absorption of 30,115sqm in the second half of 2011.
The Office Market Report shows the Perth market will continue to receive new supplies of office space in the next two years, with some 68,000sqm due to come on-line in 2011 and 88,000sqm in 2012.
Perth’s other main office market, West Perth, tightened significantly over the period, with vacancy dropping from 6.8 percent to 5.2 percent.
Some 2,700sqm of new office stock was added to the West Perth market in the six months to January, however net demand for office accommodation over the same period was 7,948 sqm.
Property Council Western Australian Executive Director, Joe Lenzo, says the Perth office market is well placed to absorb the new supply.
“Most of the new stock in the CBD is already pre-committed, and in West Perth demand for office accommodation is exceeding new supply by three to one,” Mr Lenzo says.
“Perth’s office market has reached a comfortable equilibrium. It is a healthy market that has something to offer new tenants and investors.”
“Over the longer term, however, there is growing concern of possible shortages in office stock in the face of consistently strong levels of demand.”
“No major new office project is planned in Perth beyond the completion of projects currently under construction.”
“The Perth market is also likely to experience higher than usual levels of temporary withdrawls of office stock in the near future as property owners refurbish older buildings that are of a similar age. This will put more pressure on available office supplies.”
The Property Council’s six-monthly Office Market Report has been the industry’s most respected independent office market research series for more than 20 years. The Property Council’s Office Market Report presentation by Greg McAlpine can be found here.
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