Australian Office Outlook 2025
Animated publication
448,757
118,756
14.7% 5.3%*
641,239
39,228
27,681
97,408
500
FORECAST
400
200 SQM Thousands 300
Melbourne net supply peaks in 2027; no new supply until 2030.
100
0
Sydney net supply declining sharply until 2030.
-100
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD
300
FORECAST
250
50 SQM Thousands 100 150 200
0
-50
-100
-150
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD
10% 15% 20%
10% 15% 20% 25%
FORECAST
10% 15% 20% 25%
FORECAST
FORECAST
Growth accelerated from 2022, peaking in 2024.
0% 5%
0% 5%
0% 5%
Growth expected to accelerate in 2026 – 2027, driven by the core with rent growth outside of the core to be more subdued.
-20% -15% -10% -5%
-20% -15% -10% -5%
-20% -15% -10% -5%
Consistent growth forecasted until 2030.
10% 15% 20%
10% 15% 20%
FORECAST
FORECAST
0% 5%
0% 5%
-20% -15% -10% -5%
Strong growth
-20% -15% -10% -5%
Temporary correction in 2028.
forecast for 2028-2030.
25%
FORECAST
20%
15%
10%
5%
0%
2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Sydney CBD
Melbourne CBD
Brisbane CBD
Perth CBD
Adelaide CBD
MELBOURNE
5%
18%
ICT
A clear two-tiered leasing structure is emerging in Sydney and Melbourne. Top-tier institutions secure prime-grade offices, while smaller divisions and cost conscious tenants lease secondary stock, maintaining a CBD presence at a lower cost.
21%
7%
Financial And Insurance
4%
Real Estate Services
21%
23%
Professional Services
SYDNEY
3%
18%
Public Administration
3%
34%
Education
8%
Others
6%
30%
Financial And Insurance
Professional Services
Others
Public Administration
Real Estate Services
Education
ICT
-
200
400
600
800
1,000
1,200
Net Lettable Area (SQM)
Thousands
Sydney
Melbourne
1,200,000
1,000,000
800,000
600,000
400,000
200,000
Prime Office NLA (SQM)
-
5-day RTO
Hybrid
No Mandate
Melbourne CBD
Sydney CBD
No Mandate
Hybrid
5-day RTO
0% 10% 20% 30% 40% 50% 60% 70%
Sydney
Melbourne
Education
Education
Public Administration
Public Administration
Professional Services
Real Estate Services
Professional Services
Financial And Insurance
Real Estate Services
ICT
Transport
Financial And Insurance
Retail Trade
Construction
ICT
Utilities
Retail Trade
Manufacturing
-
50,000 100,000 150,000 200,000 250,000 300,000 350,000
-
100,000 200,000 300,000 400,000 500,000
5-day RTO Hybrid No Mandate
5-day RTO Hybrid No Mandate
$18
$16
$14
$12
$10
$8
$6
$4
$2
$-
Dec-18
Dec-19
Dec-20
Dec-21
Dec-22
Dec-23
Dec-24
Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD
$60
$50
$40
$30
$20
$10
$-
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Office
Industrial
Retail
Alternatives
0 1 2 3 4 5 6 7 8 9
0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9
Non-CBD
Secondary
CBD
Prime
%
%
Cash Rate
Cash Rate
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
100 125 150 175 200 225
8
7
6
CBD A-Grade
5
Office CPPI
4
CBD Premium Grade
%
3
0 25 50 75
2
1
Cash Rate
Cash Rate
0
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
Business confidence improves
Unemployment rate moves towards 4.5%
Economic growth improves due to easing consumer headwinds
CRE credit starts to thaw and flow
Decision making timeline normalises
Core inflation improves towards 3%
Book Values Stabilise
Supply pipeline thins given capital constraints and construction costs
Consumer confidence improves
Capital markets transactions momentum continues
RBA pivots and starts rate cutting cycle
10Y bonds fall to ~4.0%
Office yield compression cycle begins →
Q1 2025
Q2 2025
Q3 2025
Q4 2025
Q1 2026
Macroeconomic/Financial Indicator
CRE Fundamentals Indicator
CRE Debt Markets Indicator
CRE Capital Markets Indicator
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