2025-09-28-莱坊-Brisbane_CBD_Office_Market_September_2025_10页_2mb

Brisbane CBD Office Market Analysis

Overview

The Brisbane CBD office market continues to show resilience, with strong demand for higher-quality space, particularly prime and premium grades. Despite recent new supply and rising vacancy, net absorption remains positive, driven by key sectors like Professional Services and government demand. Economic factors, including subdued inflation and lower interest rates, support the market, though investment activity is cautious.

Vacancy Rates

Vacancy rates are forecasted to increase from 10.2% to 10.7% in July 2025, returning to pre-crisis levels by early 2027. Prime vacancy held steady at 8.0%, while secondary vacancy rose to 14.9%. Premium vacancy tightened to 3.8%, contrasting with wider secondary vacancy due to market upgrades.

Net Absorption

Net absorption in H1 2025 reached +27,473 sqm, the highest among Australian CBDs, offsetting declines in previous periods. Prime space absorbed +41,905 sqm, while secondary saw -14,432 sqm net absorption. Annual absorption is +14,827 sqm, with supply constraints limiting further gains.

Supply and New Developments

New supply returned to the market with 205 North Quay (43,700 sqm) completed in late 2024, primarily committed to Services Australia. Additional supply includes 360 Queen St (46,700 sqm) and Waterfront North (50,000 sqm, delays possible), delivering premium and A-grade space. Net absorption may be constrained as supply enters the market.

Demand and Tenants

Demand remains strong, anchored by Professional Services (46% of leasing activity) and government sectors. Tenant behavior shows loyalty to existing spaces, with renewals outpacing relocations (16% vs. 32% in tracked requirements). Key buildings like 345 Queen St and 70 Eagle St saw strong net absorption.

Rents and Yields

Prime gross face rents increased 4.5% year-on-year to $1,048/sqm, with effective growth of 6.3%. Premium rents saw stronger gains (+2% q/q), while secondary rents are lower but accelerating. Core yields average 7.25% for prime and 8.50% for secondary markets, unchanged over the period but softer over the cycle.

Economic Factors

Economic conditions improved with GDP growth at 0.6%, supported by household consumption and population growth (around 446,000 new residents in 2024). Inflation eased to 2.1%, prompting RBA rate cuts to 3.6%. Lower interest rates facilitate lending but keep investment conservative; market growth is expected to stabilize at 1.8-2% through 2029.

Investment Activity

Investment slowed in early 2025, with sales exceeding $1 billion in 2024 but muted activity in 2025. Key transactions include 63 George St ($52m) and 53 Albert St. Sales are driven by domestic and institutional buyers, with yields ranging from 7.0% to 9.0%. Offshore interests remain, but core assets are scarce on the open market.

Future Outlook

Outlook remains positive for net absorption (+3.5% in 2025, stabilizing post-2029). Supply is expected by 2028, boosting vacancy rates further. Rents may accelerate due to limited space, with a five-year average effective growth rate of 5.6%. Market tightening will likely continue, favoring institutional investors.