Australian Office Tenant Trends September 2024

Key Points:

• CBRE Research has analysed approximately 880 leasing decisions across Australia since the start of 2021 to understand what office tenants are doing with their footprints.
• There remains a discrepancy between the size of tenant, with smaller occupiers typically expanding.
• Larger tenants are contracting, but at a decreasing frequency, indicating that the “right-sizing” phase may be coming to an end.
• With hybrid working, the correlation between occupied office stock and white collar employment has been broken. This is largely due to tenants reducing the space per employee required.
• There is a limit on how dense a workplace can get with early signs that we are at that limit. This means that occupied stock should start to grow with headcount growth again.
• Tenants continue to upgrade their office accommodation at about the same level as last year.