PERTH’S metropolitan office market appears to have moved past peak vacancy, as the current supply wave comes to an end and demand from an increasingly diverse tenant base continues to grow.
According to Y Research, the current vacancy rate across metropolitan Perth office markets is 20.9%. Suburban A-grade buildings boast the lowest vacancy at 11.9%, while secondary grade buildings in the Perth CBD and West Perth recorded vacancy rates of up to 36.4%.
Y Research principal and chief problem solver, Damian Stone said that future occupancy gains, in the CBD and suburban markets, will need to be underpinned by the expansion of tenants rather than the shuffling of the deck of tenants which has occurred in recent years.
“The lack of new supply until 2021 in the suburbs, and 2023 in the CBD, will allow metropolitan Perth office markets time to consolidate and grow their existing tenants’ bases.”
The question that remains unanswered for 2019 is that aside from resources, which other sectors will underpin growth, and are the local economic conditions strong enough to facilitate the required growth of local companies.
Source: Australian Property Jounral