Melbourne CBD office vacancy rate stable at 16.2% in Q3 – Medical Marijuana Program Connection

The city recorded negative net absorption of -9,800 during the quarter.

The Melbourne CBD office market recorded a weak quarterly net absorption, totalling -9,800 sqm, data from JLL revealed. This was predominantly driven by consolidation activity in the financial services sector and new tranches of sublease being brought to market. Headline vacancy remained stable at 16.2%. 

Here’s more from JLL:

The Melbourne Fringe market recorded a strong demand result of 32,900 sqm, whilst the S.E.S recorded a softening of -900 sqm over the quarter. Headline vacancy remained relatively stable across both the Fringe and S.E.S markets, both recording a 0.1 percentage point (ppt) increase to 15.3% and 11.7%, respectively. 

Two projects reach completion in The Fringe

No projects reached practical completion in the CBD market. The Fringe market recorded two projects totalling 42,400 sqm whilst the S.E.S recorded no completions. The largest delivery was CSL’s new 35,000 sqm headquarters at 645-699 Elizabeth Street, Carlton. 

We are currently tracking 11 new projects under construction in the Melbourne CBD (297,000 sqm), with a further 23 in the Fringe (185,900 sqm) and four in the S.E.S (66,600 sqm).

Incentives continue to soften rental performance

CBD prime net effective rents (PNER) fell 1.9% over the quarter to now average AUD 343 per sqm per year (-3.4% y-o-y). Fringe PNER fell 1.2% to AUD 313 per sqm per year (-2.8% y-o-y) as the S.E.S recorded a further…