Perth's increasingly tight office market is likely to result in gross rents exceeding $1,000 per square metre per annum next year, Jones Lang LaSalle has predicted.
Perth’s official vacancy rate is currently at a very low 3.2 per cent, however Jones Lang LaSalle head of tenant representation WA Andrew Campbell said the Perth CBD A-Grade and Premium sector is effectively already at zero per cent vacancy.
“As a consequence existing Premium grade stocks coming on line next year will achieve net rent is excess of $900 per square metre per annum and gross rents in excess of $1,000 per square metre per annum,” he said.
“The biggest challenge facing occupiers seeking office accommodation of reasonable size with an efficient floor plate is the lead time to have the space built.
“In order to devise the required strategy, staging through the next 24-36 months is crucial.”
Mr Campbell said the mining boom in WA was behind the demand for office space.
“Relate this demand issue against an existing zero office supply and a future pipeline which will not produce any supply until 2014, and we begin to understand the challenge,” he said.
“The result is that major occupiers in the Perth market need to adapt of in fact change their approach methodology to securing office accommodation and consider more strategic alternative options, such as joint venture or similar, to ensure their office needs are met.”
