The Sunshine Coast market has been a hive of activity over the last few years, huge investment into infrastructure has stimulated the local economy which has grown population and investment into the residential land market and is now increasingly being felt in the growing office market.
The completion of other properties this year including 50 Wises Road and the Kon-tiki towers without full office commitment will further dampen the results over the next couple of years. Ray White Commercial forecasts vacancies could increase to 24.1% by the end of the year before starting its downward momentum driven by increased white collar employment growth to 19.0% the following year. Encouragingly has been the flight to quality space during this time, as the A grade market increases its size, historically this market has performed well with vacancy of just 3.6% in January 2017 well ahead of the 11.2% for B grade stock with this trend expected to amplify given the availability of quality office stock on the market.
The office market has yielded impressive results across many of the east coast markets. High employment growth particularly in the finance, property and technology sectors improving
vacancies in Sydney CBD and Melbourne CBD to 5.9% and 6.5% respectively despite the high supply which has been added to this market. Brisbane CBD continues to be under pressure by high supply and public administration being the main growth employer over the last few years. Despite the woes of Brisbane, Gold Coast has bucked the trend falling to a ten year low vacancy of just 11.3%. Similar to the Sunshine Coast, local business demand and improved confidence in these locations has done much to stimulate interest by larger businesses and government tenants looking to expand or create new headquarters.