market overviews

record low vacancy rates

 

 

Perth

The Perth CBD office market is effectively full with vacancy continuing to remain below 1%. There has been no additions of stock to the market so far and refurbished stock that is expected to be delivered towards the end of 2008 is 100% pre-committed.

According to Ian Campbell, Director of Office Leasing, “CBD rental growth rates continue to be strong as market rent reviews are determining new benchmarks rather than new leasing deals. With minimal options being presented for tenants, the acceptance of new lease agreements with highly inflated rental terms is occurring frequently, however there are signs of this slowly abating. Signed leasing deals in 2008 have resulted in 'A Grade' rents reaching $850/m2 net.”

There is approximately 365,000m2 of new supply in the pipeline to be completed between 2009 and 2012 with 63.8% of this space pre-committed. In the current tight CBD market it is only these pre-commitment deals that are offering incentives to prospective tenants. Incentives have been absent from the Perth market for the past 12-18 months.

“Going forward, vacancies for the Perth CBD are expected to remain at low levels for the next 12 months with limited new supply forecasted,” said Mr Campbell.

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