ACT Executive Director, Adina Cirson said the Property Council of Australia's latest Office Market Report for the ACT reveals the market maintained its low vacancy rate as a result of strong positive demand in the Canberra commercial leasing sector.
Office vacancies are calculated on whether a lease is in place for office space, not whether the tenant's employees are occupying the space or working from home.
"Over the last six months to January 2021, Canberra's overall vacancy rate held steady at 10.1 per cent, down from 13.3 per cent recorded in January 2018, highlighting the continued tightening in the market. The Commonwealth employment base and long term tenancies in Canberra are no doubt helping our vacancy rates remain steady against the increasing vacancy trend seen across the country," Ms Cirson said.
"Canberra was the only capital city to not experience an increase in vacancy and the only city to record higher than average demand. This is good news for the ACT especially off the back of 2020. It is pleasing to see the Canberra market is now sitting below the average Australian office vacancy rate.
"Upper grades of stock recorded vacancy declines; A & B Grade vacancy both declined to 6.4 per cent and 11.2 per cent respectively. While C and D Grade recorded vacancy increases. Civic vacancy also increased to 12.8 per cent due to above average supply additions.
"Nationally, the CBD vacancy increased from 9.2 per cent to 11.1 per cent, the highest level since January 2015. Non-CBD markets recorded a larger increase in vacancy, increasing from 10.4 per cent to 13.4 per cent, the highest level since January 1995," Ms Cirson said
Ms Cirson also pointed out the importance of ensuring everyone, as much as possible, returns back to the office. With over 50 per cent of the ACT office market tenanted by the government, ensuring that these offices are full will be essential in supporting the broader economic recovery. This is now, more than ever, the leadership that needs to be shown.
"As our office markets adapt to a COVID-normal setting, business and government have a critical role to play in supporting the return to office workplaces and helping more people come back to office precincts. Vibrant city centres drive investment, growth and productivity and must be part of our recovery planning," Ms Cirson concluded.
