As the supply for new office space decreases and continues to drive demand in the Sydney and Melbourne CBD, vacancy rates tighten to levels not seen since the late 1980s.
New research figures show that Sydney CBD recorded 71,800 sq m of net absorption over the 12 months to March 2019 and vacancy tighten to 3.7 per cent. Due to low net additions being outpaced by moderate demand and surge in office rents, researchers forecast that Sydney and Melbourne will hit 3 per cent by the end of 2019.
Sydney CBD has re-established its normal vacancy rate hierarchy with 3.3 per cent for premium vacancy, 3.9 per cent for below A Grade which is lower than the secondary grace vacancy of 3.9 per cent.
Numerous companies are expanding and the limited option for prime grade space will cause pre-commitment activity over 2019 and 2020.
Image and article source: https://theurbandeveloper.com/articles/sydney-and-melbourne-office-crunch-not-seen-since-the-80s-?utm_source=email
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