Perth’s office vacancy rate has grown to 19.9 per cent, but its net absorption was the strongest in the country, recent JLL statistics show.
Perth’s office vacancy has grown to 19.9 per cent in the March quarter and remains the highest in the country, but the city’s net absorption rate is the strongest, JLL figures show.
The real estate group’s latest office market figures represent a 0.9 per cent increase in office market vacancy since the last three months of 2022 and a 0.2 per cent lift on 12 months ago.
The 19.9 per cent office vacancy rate compares to a 14.3 per cent rate nationally, 13.7 per cent in Sydney and 15.6 per cent in Melbourne.
The figures are collated differently to Property Council of Australia’s office report, which pegged Perth’s office vacancy at 15.6 per cent in February, representing a 0.2 per cent drop over six months.
While Perth remains the highest office vacancy in the country, its net absorption, which refers to the difference between the amount of space that became occupied and space that was vacated, was the strongest of the capital cities for the March quarter.
Perth recorded positive net absorption of 27,200 square metres for the quarter and 50,500sqm for the 12 months to March 2023, JLL’s data shows.
This compares to national figures of 43,400sqm across CBD office markets in the March quarter and 124,200sqm over the year.
JLL head of office leasing Australia Tim O’Connor said that Perth had one of the most resilient office markets in the country.
“A diverse range of industry sectors are in expansion mode and contributing to positive sentiment in the Perth CBD,” he said.
“High-quality fitted space is receiving strong interest, while we estimate that one-third of Perth’s vacancy is structural and will be very challenging to lease without significant capital expenditure.”
JLL head of research Australasia, Andrew Ballantyne, said the country’s office markets had proved more resilient than other places around the world.
“Australia’s office markets have proven to be more resilient than other mature economies,” he said.
“While several organisations are operating in a more flexible manner, headcount growth has translated into positive net absorption.”
Mr Ballantyne said part of Australia’s resilience was its return to office numbers were more comparable to what we were seeing across Asia Pacific, as opposed to North America and Western Europe.
“Our cities are becoming more vibrant with a mix of visitors, residents, and workers,” he said.
