Adelaide CBD Office Figures Q3 2024

Key Points:

• Office demand across Adelaide’s office market remained strong during Q3 2024 with over 90,000 sqm of enquiry recorded during the quarter, which was up 7.2% y-o-y. Net absorption recorded during H1 2024 was 29,041 sqm, the highest net absorption recorded in 15 years.
• Prime gross rental rates ended Q3 2024 at an average of $629 per sqm, increasing by 0.2% q-o-q and 7.4% y-o-y. The secondary grade market experienced minimal movement over the quarter with gross rents remaining stable at an average of $390 per sqm (+2.1% y-o-y).
• The Adelaide CBD overall vacancy rate as of H1 2024 decreased to 17.5% from 19.3% in H2 2023 driven by the strong net absorption figure.
• Having seen a record high of 78,109 sqm of net supply added to the market in 2023, Adelaide’s CBD net supply was muted in H1 2024 with only 152 sqm of net supply recorded. 
• With the sale of 121-129 King William Street in Q3 2024 for $84.25m at a c.7.6% yield, total 2024 CBD office volumes increased to $98 million.
• Average prime office yields softened by 14 bps q-o-q to 7.63%, while secondary grade yields were stable q-o-q at 9.45%.