Australian Office Market Q2 2023

National Office Figures Report

August 3, 2023 10 Minute Read

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Key Points:


  • The labour market has been more robust in the face of higher interest rates, with the unemployment rate remaining at 3.5% in June 2023.
  • Office demand softened in H1 2023, with -117,600 sqm of net absorption across all Australian markets. Prime absorption remained positive at 35,000 sqm for the first 6 months of the year.
  • National vacancy edged up to 14.1% in June 2023, from 13.4% in December 2022, due to a combination of negative absorption and some supply delivered to the market.
  • Rental growth has been solid with average CBD net face rents up 5.4% over the past year. However, the results are mixed depending on the market and grade.
  • National incentives were largely flat over the past 12 months, averaging 38.7%. The stronger performing leasing markets are starting to observe declines in incentives.
  • Sales volumes remained subdued during the quarter as pricing continues to correct.
  • Yield softening has continued across all markets.