Advanced Search

Share Coverage



Category: Urban Development and Planning / Business, Economics and Finance

Tenants win as Perth CBD commercial vacancies soar

Monday, 21 Nov 2016 12:43:03 | Emma Wynne

After a shortage of office space during the boom, for lease signs now dominate Perth commercial districts. (ABC: Glyn Jones)

"If you sign a 10-year lease today, most likely you are getting five years rent free."

So competitive is the state of Perth's office space market, building owners are offering exceptional terms — including years of free rent — to entice new tenants, property analyst Damian Stone from Y Research told 720 ABC Perth.

Rents have tumbled to as low as $250 per square metre in West Perth; five years ago office rents in the Perth CBD averaged almost $1,000 per square metre as companies outbid each other for space.

"It's a competitive world and there just aren't the number of businesses that were around five years ago," Mr Stone said.

In addition to discounting, landlords are also going to "extraordinary lengths" to make their buildings more appealing.

"If you go into some of these buildings, it's like the Tour de France with the number bikes and bike lockers and showers and gyms," Mr Stone said.

"Now we are also seeing building concierges — you can call down to the front desk and ask them to make you a restaurant reservation."

The changing face of the CBD

While it is bad news for building owners, the change in the market has created opportunities for businesses that could not afford boom-time rents to move back into the city.

"Compared to resources cities across the world, we have some of the highest vacancies outside of Brazil," Mr Stone said.

"What that creates is a once-in-25-years chance for businesses to grow into the city.

"It's a lot more affordable for schools, non-profits, technology companies to come into the city, and that is how the city is changing after the resources boom."

Students eating lunch outside their new high rise school in the Perth CBD Photo: School and university students may become more common in Perth's CBD as educational institutions move in. (Supplied: St George's Anglican Grammar School)

The biggest growth tenant in the city in the past three years has been the education sector.

In 2015, a private high school opened in a former office building, while Queensland's CQ University has announced plans to open a four-storey campus in a refurbished office block in 2017.

"There are also plans for a primary school and another high school in some of the older buildings," Mr Stone said.

"Shared workspaces, education and medical research make up 6.5 per cent of the city.

"These [sectors] will grow in the next few years."

AustraliaPlus


 

Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend