Brief | Evolving Workforces

Sydney CBD Sublease Barometer December 2023

February 6, 2024 5 Minute Read

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  • Sydney CBD sublease availabilities ended 2023 at 129,753 sqm, declining by 10,000 sqm over the fourth quarter. This brought the CBD sublease vacancy rate to 2.5% as of year-end.
  • It appears as though rightsizing by larger corporate occupiers is slowing. Sublease volumes for blocks of space greater than 1,000 sqm declined by 11% over Q4 2023.
  • The Banking & Finance sector continued to account for the greatest share of sublease availabilities in Q4 2023, at 32% of the CBD total. The next largest contributor to sublease volumes was the Tech & IT sector, at 15% of the CBD total. The amount of sublease space being listed by each of these groups declined over the fourth quarter.
  • Much of the sublease leasing activity over Q4 2023 occurred in Premium assets in the Core and Walsh Bay precincts. The volume of sublease space in Premium assets fell by 20% from Q3 2023 to Q4 2023 and the volumes of sublease availability in the Core and Walsh Bay precincts fell by 9% and 33%, respectively, over this same period.
  • The ongoing recovery in office re-occupancy rates and the continued flight-to-quality by tenants is now leading to optimism that CBD sublease levels will continue to decline over the first half of 2024.