Office market recovery underway, with 33% surge in enquirers: Colliers International

In one of the clearest signs that a CBD office market recovery could be underway, Colliers International has produced new research which revealed a 33% surge in enquiry levels in the first half of 2013.

Its figures showed 310 more enquiries were registered for an additional 273,989 square metres of office space in the 12 months to June, while deal volumes remained steady.

Despite industry concerns around business sentiment, Colliers said that then higher enquiry figures showed activity in Australia's office markets was "strong" and supported its own prediction of a "market recovery by H2 2014".

"We have heard a lot of doom and gloom about the office leasing market this year, but the facts are that there is activity in the market," said Colliers office leasing managing director, Simon Hunt.

In the Sydney CBD, more than 215,000 square metres of enquiry was recorded during the first half, while in the Melbourne CBD, enquiries hit 158 for more than 132,000 square metres of space. That compared to 140 enquiries for just over 81,000 square metres over the same period in 2012.

"Small and medium sized tenants are in the market looking to secure a good deal, and are helping to drive current levels of activity," added Mr Hunt.

The largest proportion of deals occured in the 1-999 square metre range, with 279 leases equating to 82,810 square metres taking place in the first half of 2013, the Colliers research showed.

Data from the research also showed professional services were responsible for a large proportion of the activity, driven by new leases to businesses such as AGL, BHP, Corrs Chambers, Pacific Brands, Virgin Active and IBM. There was also strong spike in the number of Information Technology and Communication companies looking to relocate, with this sector making up 20% of the enquiries.