Melbourne CBD Office Figures Q1 2026

Key Points:

• Melbourne’s CBD has experienced its strongest period of absorption since H2 2021, with a recorded +28,029sqm. This also equates to the strongest 12-month net absorption recorded since before the pandemic, specifically 2018, when absorption exceeded 150,000sqm.
• The major office completion of 51 Flinders Lane was recorded in Q1 2026. Forward annual supply remains subdued, with only 25,000sqm of new stock expected between 2027 and 2030. The supply drought could extend beyond 2030 as feasibility pressures rise.
• Vacancy in Melbourne has risen to 19.0%, representing a 103bps increase from H1 2025. The increase in vacancy is attributed to the c.100,000sqm of net supply recorded in H2 2025.
• Prime net face rents increased by 1.1% over Q1 2026. Prime effective rents experienced similar growth, supported by stabilising incentives across most precincts.
• No major CBD transactions were recorded in Q1 2026. Yields held stable over the quarter, although we currently expect to record yield softening later this year.