Brisbane Office Market
The CoreNet State of the CRE market panels across the country always bring out a little more than the normal CRE narrative. Recently Brisbane was no exception. Thank you, Danni Toshak, of ACCORP and Tom Broderick of CBRE for your time and fantastic insights.
Here are some of our takeaways from the day and the panel.
Brisbane CBD is the most optimistic capital city office market in the country.
Overall vacancy is just above 10%. Primary vacancy is slowly decreasing, and Secondary vacancy is slowly increasing, like the other capitals. Tenants are upgrading to better quality premises however this transfer is slowing due to affordability.
Future new supply is limited at the moment apart from Waterfront Brisbane. Some are predicting the next building after this could be as soon as 2030. In the interim there is still space to lease.
Absorption has been up and down over the last couple of years. This is going to be the thing to watch. It is all well and good to have supply issues, but if there is limited demand, there are limited supply issues.
Rents have increased more than 30% over the last 3 years. In some instances, they are now at the same gross effective level they were at in 2007, at the height of the last boom in Brisbane. This time there are still generous incentives just not as generous for primary stock.
A question during the panel; What do tenants do when there is little primary space to lease or the rents are too high?
They do what they have always done; move to less expensive space. It’s the accordion effect at work, and we see this occurring in Brisbane in the not too distant future. Tenants cascade up when market conditions are right. When things change, they cascade down. What goes up, comes down and vice versa.
As for the Olympics, it is too early to tell what impact it will have on the CBD office market. If the Sydney experience is any guide, the impact would be on the non-CBD markets as some are already predicting.
In all, a great event, great panel insights and great participation from the audience.
This will be a market to watch in 2026.
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