Sydney’s commercial office market has slowed down over the past couple of years, after years of unprecedented growth. Let’s take a closer look at the trends that are working in tenants’ favour.
Sydney's CBD vacancy rate has increased over the last quarter, now reported at 11.5%.
However, vacancy figures could be much higher, especially considering the number of subleases available.
With limited supply in the pipeline and approx. 42,000 sqm of space to be withdrawn for the Hunter Street Metro Station, many agencies remain upbeat about the market's recovery.
But we believe Sydney will stay a tenant's market for the foreseeable future due to:
In a bid to maintain property values, gross face rents have continued to increase quarter-on-quarter, with Premium rising from $1,645 to $1,680, A-Grade from $1,360 to $1,385 and B-Grade from $1,085 to $1,100. However, a rise in incentives has offset these increases, now averaging between 30-39%.
The Sydney CBD has seen an uptick in the amount of sublease space available, now sitting at 126,796 sqm (2.4% of stock). This comes as key industries, particularly the tech sector, rethink their property requirements. The ongoing struggle to attract staff back to the office is also a factor.
The best deals we're doing are in the sublease market, where businesses are offering their space at a heavily discounted rate to exit their lease.
Tenant CS is a commercial tenant advisory service that offers tenant representation services in Sydney. We can also cater to businesses across Australia, with a particular focus in Melbourne, Perth, Adelaide, Brisbane and Canberra.
If you’re on the hunt for tenant representation services in Sydney, get in touch with our team today!