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.
According to the recent Property Council of Australia’s Office Market report, total vacancies have grown to 15.0% which is below the 20% which most of the market anticipated. While this is an encouraging result the full effect of these new premises is most evident in the A grade market, given its increase in size, vacancies now have increased from just 3.6% in 2017 to 20.0%. This is likely to result in some discounting and growing incentives across the prime market to attract both new business to the Sunny Coast and existing tenants to upgrade their current accommodation. B grade stock has recorded its third consecutive year of vacancy reduction to just 9.0%, while C grade has increased from 5.8% last year to 11.8% the very small D grade market now recording a zero vacancy factor.
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 4.6% in both markets despite the volatility in supply in both markets. 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 10.6%. 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.