Over-the-counter commercial properties despite office occupancy levels
Although office occupancy rates in Sydney and Melbourne have fallen below 10% due to the closures, a number of homeowners continue to invest in state capitals during one of the sales seasons. the most important ones that the two cities have known for years.
Homeowners with large portfolios are looking beyond the pandemic, with international investors such as Singapore-based CapitaLand snatching up commercial properties that have been put up for sale in the recent past. Dexus and Investa both own a number of buildings that are expected to hit the market in the coming weeks, with Alfasi joining the influx, selling half a state in his new $ 250 million tower in Melbourne.
While many businesses are adopting hybrid home-office work models, owners believe there is still a desire for office space. This is supported by the number of properties picked up in recent sales. Melbourne’s Deague Group recently sold a property on the outskirts of the Garden City to Centuria Capital for $ 205 million, while buying an office building in Adelaide for $ 63 million.
Property Council of Australia chief executive Ken Morrison said he expects occupancy rates to increase dramatically in the CBD when heavy restrictions are enacted.
“Our CBDs support millions of jobs and generate hundreds of billions of dollars in economic activity,” he said in an interview with the Daily Telegraph.
“We know the blockages are having a big impact on our CBDs, but it’s encouraging to see that once the blockages are lifted, workers are coming back at a faster rate than what we saw in 2020.”
Morrison goes on to say that the Delta variant has launched a number of unique curved balls in state capitals.
“The recent delta epidemics have not affected all cities equally and have created two distinct challenges in our inner cities,” he said.
“For the capitals that have been less affected, we need to find a way to encourage workers to increase their number of days in the office. “
“Once we overcome the immediate threats to public health, it is essential that building owners and employers work with all levels of government to get our CBDs working at full capacity again. “
A recent occupancy survey conducted by the Council indicates that Sydney’s CBD occupancy rate currently stands at 4% from pre-Covid levels, with Melbourne reporting a total of 7%. Canberra’s occupancy rates fell exponentially in the space of a month, from 73% to 8% of pre-Covid levels. The Brisbane and Adelaide CBDs are currently 60 and 65% occupied. CBD office occupancy rates are not expected to return to higher levels in Sydney, Melbourne and Canberra for at least three months.