Brisbane’s CBD office market is benefitting from a wave of tenant activity, with tightening vacancy levels in the Near City precinct prompting occupiers to look beyond the city fringe, according to CBRE.
CBRE’s James Comino said CBD office landlords were adapting to the shift in tenant sentiment, injecting capital into building upgrades in a bid to lure tenants.
“CBD office landlords have been reinvesting into building refurbishment and upgrades to ensure these assets are as attractive as possible to the tenant community,” Mr Comino said.
“Diversified onsite amenity, such as concierge services, end of trip facilities and shared meeting facilities, has become increasingly important.”
The wave of activity comes as vacancy levels in Brisbane’s Near City market are expected to decrease to around 8%.
“With A-grade vacancy rates in the Near City market continuing to decrease, tenants seeking contiguous levels of office space in the 2,000sqm – 6,000sqm range are now looking for alternative options,” Mr Comino said.
“Occupiers are looking to the CBD for opportunities, where occupiers have significant choice of space, with A-grade vacancy currently around 14.1% - inclusive of the sublease market.”
Mr Comino said a flurry of recent deals in the CBD was evidence of the area’s increasing appeal, with tenants capitalising on the high level of amenity and competitive terms on offer.
“Aside from the often superior onsite offerings of a CBD office tower, there is the added benefit of immediate access to all public transport nodes, service and food/retail options. These benefits, coupled with the strong incentives on offer at present, make for a compelling case for business to consolidate into the CBD,” Mr Comino said.
“The key factors for any new lease arrangement must consider cost control, lease term flexibility and an improvement in building quality and location from where the business is locating from.”
Recent tenant movements into the CBD include; Australia Energy Market Operator – 1,800sqm; Australian Bureau of Statistics – 2,400sqm; IFAA Administrators & Advisers – 3,600sqm; SAP Australia – 4,000sqm and Tatts Group – 18,000sqm.
Mr Comino said there was also a number of active requirements that could underpin more movement into the CBD – including Arcadis – 1,600sqm; Expedia – 2,000sqm, Cardno – 6,000sqm and Origin Energy – 15,000sqm.