Sublease space across Perth’s CBD offices increased during the first quarter of 2021, but has had minimal impact on the overall market, according to CBRE’s latest report.
Sublease space across Perth’s CBD offices increased during the first quarter of 2021, but has had minimal impact on the overall market, according to CBRE’s latest report.
CBRE’s quarterly Sublease Barometer report found new sublease additions had begun to level out from previous peaks across all Australian markets.
Adelaide recorded the largest fall in sublease availability (down 24 per cent), followed by Sydney (down 6.5 per cent).
Meanwhile, sublease space increased in Brisbane, Melbourne and Perth.
Sublease availability in the Perth CBD increased by 3.4 per cent, up from 29,900 square metres at the beginning of the year to 40,800sqm.
Melbourne recorded the largest amount of sublease availability (177,499sqm) for Q1, with Sydney next in line with 158,631sqm of sublease space - nearly four times Perth’s sublease availability.
CBRE senior director office leasing WA Andrew Denny said that space represented just 2.3 per cent of the Perth CBD’s total office market.
“With overall vacancy at 20 per cent, sublease availability does not have a significant impact on the market,” Mr Denny said.
“During the mining induced post-2012 downturn, sublease availability peaked at 100,000sqm by the end of 2015. This had an impact.”
CBRE’s report found rental metrics remained unchanged, with face rents and incentives holding steady.
The report forecasted improving leasing volumes, off the back of 12-month renewal periods from early 2020.
CBRE’s head of office occupier research Joyce Tiong said contraction remained the primary driver for sublease across all of Australia’s CBD markets.
Construction, administration and support services, as well as utilities service businesses recorded the largest percentage falls (53 per cent, 41 per cent and 22 per cent respectively).
By office footprint nationwide, CBRE’s report found offices of less than 500sqm contributed to the bulk of available sublease by the number of tenancies.
The 1,000 to 2,000sqm segment continued to expand and increased by 23 per cent across 58 tenancies (compared to 49 tenancies in December).
Interestingly, the over 2,000sqm bracket recorded a 9 per cent fall across 51 tenancies (compared to 55 tenancies in December).
