Sydney Office Update December Leasing Magazine online | Page 3
CONTENTS
02 Thought Leadership: Rent or Buy
04 HOT SPOT: Skittle Lane
05 Focus Listings
07 JHK Legal: Assigning Your Lease
08 Intermain: Set Yourself up for
Success
10 Investa: Sydney Office Market
12 Gensler: Design as an Innovation
Superpower
14 November Transactions
15 Recent Transactions
16 Tenant Rep Table
17 Find Your Perfect Space
KEY ECONOMIC
DATA:
Cash Rate: 1.5%
Australian unemployment rate: 5.5%
Vacancy rates for Sydney CBD: 5.9%
Ray White Commercial Group total
trading value Nov 2017: 283 million
A
CURVE
BALL
Christmas has thrown us
a curveball this year - the
usual pre-Christmas rush by
tenants to close out leasing
deals before the 25th just
hasn’t fired.
In the past, it’s like Christmas adds
fuel to deals that may have been
languishing. Most agents and lessors
who have been in the market for a
few years can attest to times past
when it gets to mid November
and transactions that have been
coasting suddenly get ignited and
there’s a rush to get terms agreed,
documents signed, bank guarantees
issued and trades instructed before
we break for the end of year
holidays, with spirited negotiations
firing right up until Christmas eve.
2017 has been different. And it’s
been different for a few decent
reasons. Tenant demand exhausted
itself in the first three quarters of
2017 and the expected acceleration
in the last quarter just hasn’t
happened. Yes we’ve had huge
rental growth and yes vacancy rates
are historically low, but the lack of
demand at end of year is a point
of concern for how the market will
respond in 2018.
I suspect that the limited supply
of stock, strong employment and
investment will keep rents stable
in 2018. We’re seeing incentives
increase on some deals, but in
cases where office space is offered
with quality fit outs and furniture,
transactions are being done at low
incentive levels and strong rents.
Coworking trends continue to
eat into office demand. Green
Street Advisors issued a report
in November 2017 stating there
will be about 14,000 co-working
locations worldwide by the end of
this year, compared with 600 in
2010. Now that’s growth! This is
an increasing challenge for lessors
to compete with, but it can also be
seen as a field of opportunity for
creative thinkers.
And now for some stats of our own.
We’re pleased to report our leasing
team concluded over 100 leasing
deals for the 2017 calendar year.
Our momentum has been a result
of proactive canvassing, quality
marketing, team energy and most
importantly, sensational clients and
quality properties. It makes it much
easier to do our job when we get
to work with such great people! So
we thank you.
To all our clients, customers and
colleagues, we wish you and your
family a Merry Christmas and a safe
new year. Is there better place to
work than Sydney City and I’d have
to say, it’s getting better every year.
All the best,
A NT HO NY HA R R I S
M: 0409 319 060