Sydney surges into second half as office leasing deals spike

Office leasing levels nationally have increased 13% when compared to the same time last year with overall square meter space up 22%.

Demand for office space is highest in New South Wales with 112,937 sqm leased so far this year, up from 64,629 sqm recorded in the first half of 2014. 

Figures from Colliers International show interest in office space sized between 1,000sqm and 3,000sqm around Australia increased 31% from Q2 2004 to Q2 2015, with demand up 25% from Q1 2005 to Q2 2015.

Colliers International national director of office leasing, Cameron Williams, said larger firms are driving demand for office accommodation in 2015 compared to 2014. when smaller space was in strong demand.

“Core premium remains the most challenged market however, as we had anticipated, a flight to quality is occurring that will result in significant commitment within the core premium market during the second half of 2015," Mr Williams said.

“In 2014, we saw the government sector dominating as they put large requirements into the market. However, as we move into the second half of 2015 we are seeing business services, communications and finance catching up and dominating both in enquiry levels and leasing deals being negotiated.

 “At the smaller end of the market there has been a lot of activity from Asian investment companies that have a preference to be located in Sydney’s midtown. This growth is naturally having a positive impact on net absorption and lessors are becoming more confident."