Nearly all locales across the Gold Coast region record positive demand for office space, according to the Property Council of Australia’s January 2023 Office Market Report released today.
Over the six months to January 2023, the Gold Coast’s office vacancy rate fell from 8.1 per cent in July 2022 to six per cent in January 2023 as employers continue to enter the market.
Queensland Executive Director of the Property Council Jen Williams said businesses are continuing to flock to the Gold Coast in pursuit of strong economic conditions and the enviable coastal lifestyle.
“COVID-19 driven lifestyle changes precipitated a resurgence in the Gold Coast office market and this trend shows no sign of subsiding,” Ms Williams said.
“The Gold Coast is recognised as a premiere location to live and work with a truly unique lifestyle value proposition, so these positive signs are unsurprising as this region continues to sustain strong growth.
“However, with such a spike in demand consideration must be given to identifying avenues to build more stock so the region can maximise future investment,” she said.
CBRE Senior Director Tania Moore said there has been persistent strong activity for the Gold Coast market with an above-average annual take-up over the last two-year period continuing through the second half of 2022.
“The average annual net absorption for the past two years has been around 15,000 square metres per annum and overall unoccupied space across the market has now fallen below 30,000 square metres for the first time since the early 2000s,” Ms Moore said.
“The A Grade market is especially tight at 4.4 per cent, this is due to the long-term flight to quality trend and under 4,000 square metres of A Grade stock is available.
“Currently there is less than 4,000 square metres of available A Grade stock following an annual net absorption of 5,711 square metres and with no new supply additions in this asset class for the foreseeable future,” she said.
While Ms Moore was positive about these strong figures, she cautioned that there are no new substantial supply additions to come online for the Gold Coast office submarkets in the near future.
“The low vacancy levels have created an environment for the emergence of strong rental growth which will support the feasibility of future projects,” Ms Moore added.
“Although most developers are seeking 50 per cent pre-commitment which is challenging to achieve in a market where the average tenant size is 150-250 square metres,” she said.
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.
