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HS Brisbane Property
0419 782 133
+61 (0) 7 3254 0888
sales@hsbrisbaneproperty.com.au
PO Box 15301
Brisbane City East
Queensland 4002
Australia

Investment In Brisbane CBD Office Market Up $1 Billion YOY

A recent Knight Frank report on CBD office activity shows the market is going from strength to strength, reports propertyobserver.com.au.

 

The Brisbane CBD Office Market Overview report, conducted by Knight Frank Partner Research and Consulting Queensland, found in the year to September, investment volumes were at $2.86 billion, which is an increase of around $1 billion from the corresponding period one year earlier. 

 

Overseas buyers drove the market in 2018, accounting for 73% of sales in 2018, dropping to 17% this calendar year. 

 

Oxford Economics reports that Brisbane will be a standout region for employment growth this year, with office-based industry positions accounting for 25,000 new jobs. The next five years will see an average of 10,500 office jobs added to the jobs market each year. 

 

More office workers means more office space needed! The findings from Knight Frank show that the strong tenant demand has dropped vacancy levels to the lowest in seven years, decreasing to 11.9% vacancy down from 14.6% the previous year. 

 

Vacancy rates are expected to increase slightly later in the year and early next year, but will tighten again as next year progresses.

Some key tenancy agreements over this year and last such as Suncorp’s pre-commitment to 80 Ann Street helped to see the finance and insurance industry tenant activity account for 26% of the market, followed by government and public administration at 22%, and resources and energy at 10%. 

 

Knight Frank partner and Head of Queensland Ben McGrath says yields have tighten. 

 

“Compressing by 23 basis points over the past year, Brisbane CBD yields are starting to move more in line with the Sydney and Melbourne CBDs.” 

 

“This comes after a period of accelerated yield compression as Brisbane was re-rated by investors," said Mr McGrath.

 

When the CBD office market is thriving, residential accommodation in premium locations becomes sought-after investment and owner-occupier stock. The ‘Felix’ building is in a prime location in the ‘Golden Triangle’ on the corner of Mary and Edward, and opposite Waterfront Place. The apartment complex is perfectly positioned for CBD workers, where buyers can purchase a two bedroom, two bathroom apartment for under $550,000.

 

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