Canberra recorded the third highest office vacancy rate among the country's capital cities, behind Darwin and Perth. Photo: Alex Ellinghausen Commercial operators in Canberra have less office space available to them with the capital’s vacancy rate dipping to 12.6 per cent in January, according to the Property Council of Australia’s latest statistics.
The Office Market Report released on Thursday shows Canberra’s office vacancy rate has taken a small dive from the 13 per cent recorded six months ago, thanks to the withdrawal of 32,616 square metres of space.
It represents a drop of one percentage point over the past year.
Property Council of Australia ACT executive director Adina Cirson said the decrease wass largely a result of withdrawal of stock rather than positive demand for space.
Canberra’s result, together with Brisbane, represented the second-largest drop in vacant office space among Australia’s capital cities over the six-month period, behind Melbourne.
Ms Cirson said the ACT’s 12.6 per cent rate of empty space was reasonable compared to other cities, with Sydney at just 6.2 per cent and Perth and Darwin at 22.5 per cent.
However, she said more incentives were needed to enliven tired office space so increasing demand for premium space was met.
The availability of high-grade office space, or A and B-grade space, was more than half that of lower-grade stock as of January, at 9.8 per cent (A) and 8.7 per cent (B).
In contrast, the vacancy rate of C and D-grade office space sits at 18.7 per cent and 23.1 per cent respectively.
“This is particularly critical with no new supply in the pipeline beyond 2019,” Ms Cirson said.
“Canberra is really starting to boom, and with the investments being made across the city – both by the private sector and government – I believe we will see an increase in demand, but it will be for premium product.”
The rate of empty commercial space available in the CBD alone has also fallen, from 10.3 per cent in July 2016 to 9.4 per cent.
Across the territory, the net absorption of office stock came in at 16,342 square metres over the six months to January, with 3304 square metres of space added.
Looking forward, the council expects an extra 22,988 square metres of office space to hit the commercial market in 2017, and an extra 1235 square metres in 2018.