The rise in vacant offices for sublease in Sydney’s CBD has hit a near five-year high, cuing worries on softening business conditions and emerging economic headwinds.
Research has found that over the last quarter, the available office space to sublease in the inner city is more than doubled from 28,700 sqm to 70,250 sqm. This is a result of various companies moving to different locations.
The relocation to new premises and contracting and subleasing excess space are the top two reasons for this increase in the vacancy rate which accounts for about 70% of sublease space on the market according to research.
On the other hand, David Cannington, an economist and head of research and strategy at Investa gives a warning that it is too soon to tell how significant the recent increase in sublease space was.
“The interesting point with the emergence of subleasing activity is how long it is sustained for given that Sydney is in a supply constrained market at the moment,'' he added.
Image and article source: https://www.afr.com/property/commercial/rise-in-vacant-offices-for-sub-lease-a-sign-of-things-to-come-20190823-p52k6n
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