Welcome to Corporate Property Matters Markets.
Throughout the year we will review various real estate markets, the trends within them, and how these may affect your corporate property decisions. Economists we are not, however as the global economy and markets (non-real estate) have a direct bearing on sentiment and finance, it is important to keep up to date and get varying views on where the world economy is heading.
To get the year started, The Property Council of Australia released its national office market figures last week (4 February). The office markets across Australia have been split into two camps since the mining slowdown. Sydney, and to a lesser extent Melbourne, have enjoyed a healthy run of demand and future supply keeping vacancy at reasonable levels in both capitals. However Brisbane, Perth, Canberra and Adelaide, have experienced falls in activity and increases in vacancy in varying degrees.
In Sydney technology companies were the most prominent contributors to the jump in demand. Withdrawals continued at a similar rate to the previous two half-yearly periods helping to keep vacancy from rising, and supply in 2016 will grow. As one pundit noted, the addition of an extra 100,000 m2 of un-committed office space will have an interesting effect on the market during the year.
With the volatility in global markets, the major global corporates continue to be cautious. 2016 shall still see a reasonable amount of activity in the office markets but perhaps not to the extent that some have predicted.