Darwin office vacancy rate doubles: PCA
Darwin was the clear underperformer across all capital cities in Australia, according to the latest Office Market Report by the Property Council of Australia, with the vacancy rate nearly doubling over last year.
This was the result of an economic convergence of increasing supply and lower demand. The city reported the highest supply rate increase in Australia at the same time as it was experiencing the lowest demand growth, says the PCA.
The vacancy rate rose to 20.7 per cent from 10.9 per cent last year.
“Darwin city has recorded the highest supply rate increase and the lowest demand growth in the nation,” said PCA Northern Territory director Ruth Palmer said.
“A significant amount of supply has been brought onto the market over the last 24 months. This has occurred despite demand weakening during the same period.”
The report shows that negative demand was concentrated in the lower grades.
“Darwin’s vacancy rate has jumped 9.8 per cent and this was largely due to -18,727sqm of net absorption and 16,286sqm of supply additions.
All grades of space recorded vacancies of about 15 per cent.
“In order for us to see a long-term improvement in the office market, we need further investment in the City Centre, in particular the implementation of the Darwin City Centre Master Plan projects,” added Palmer.
“Furthermore, it's critical that we receive a commitment from the Northern Territory Government to increase employment levels in the City Centre.
“Not only do we need to increase employment levels and investment in the city, we need to encourage further residential development to allow for additional population growth in our City Centre.
