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Perth Office Market
In the six months to July 2010, both the Perth CBD and the West Perth office markets posted big gains in net absorption, the primary indicator of office demand. Net absorption for Perth CBD was 36,555 sqm, five times the 20-year historical average; whilst the West Perth office market posted a net absorption of 6056 sqm, more than twice the historical average.
Despite strong demand, Perth CBD vacancy increased over the period from 8.2 percent in January 2010, to 9.9 percent in the six months to July 2010, primarily driven by a large amount of new supply, the second-highest on record. A total of 71,574sq m of new space was added during the six months to July 2010, the highest increase in supply since January 1992.
The six months to July 2010 have seen an increase in quality in the Perth CBD office market, with the Premium and A Grade segments posting a combined absorption of 62,899 sqm.
There is still a further 175,054 sqm of space, forecast to enter the Perth CBD during the current construction cycle (to 2012), with 70 percent already pre-committed. Upon completion, these projects will increase the size of the Perth CBD office market by 12 percent.
Major projects still to be completed are:
- City Square (71,000 sq m) developer Brookfield Multiplex. BHP Billiton has pre-committed to 60,000 sq m.
- Raine Square (42,500 sq m) developer Saracen Properties. Building is fully pre-committed to BankWest.
- Dynons Plaza (13,178 sq m) developer Stamford Group. Building is fully pre-committed to Chevron.
- Westralia Plaza (9,819 sq m) developer Insurance Commission of WA.
In Perth’s other main commercial office market, West Perth, the vacancy rate increased slightly, from 6.1 percent in January 2010, to 6.8 percent in the 6 months to July. As in the Perth CBD, the increase in the vacancy rate was due to supply additions, of 11,536 sqm. Additionally, the West Perth market has seen a great deal of tenant movement in the six months to July 2010.
A further 10,396 sq m of stock is scheduled to come on-line in West Perth in the current construction cycle (to 2012).
Please contact the Economic Development Unit via email to ecodev@cityofperth.wa.gov.au or on +61 8 9461 3198, for any further information.