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Bosses show confidence in a return to the office but city workers hold out

Business

Brisbane companies are snapping up premium office space in a sign that the CBD may be coming back to life, according to a Property Council survey.

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The survey shows that the leasing of office space has improved, which could be an indicator that businesses have the confidence that the workers will go back to their desks.

The survey found office vacancy rates in the CBD were down to 14 per cent in June, a slight fall from 15.4 in January.

However, Google mobility data, which aggregates data from the tracking of mobile devices, shows that workers in the south east remain reluctant to return to the office.

The Property Council found a similar result.

“While demand for office space is increasing and the long-term outlook for Brisbane is positive, the actual number of office workers in our city centres remains below pre-pandemic levels,” the council’s Queensland executive director Jen Williams said.

According to the Google data, while statewide visits to the workplace were above the pre-Covid baseline, in Brisbane, it was still down 14 per cent. The Gold Coast, Noosa and the Sunshine Coast were also areas where workers were holding back.

Public transport still appears to be something of a no-go zone. It remains 30 per cent below the pre-Covid baseline.

Meanwhile, there has been a big surge back to workplaces in Cairns, Ipswich, Gympie, Logan, Mackay and Bundaberg.

Williams said the vacancy data showed Brisbane was thriving.

“Historically, Brisbane’s office market experiences demand of around 9000 square metres of new space every six months. However, since January this year, we have seen over 44,000 sq/m of absorption, more than four times the historical average,” Williams said.

“In the global war for talent, employers are seeing the physical office as an important feature in attracting and retaining staff.”

She said the demand was focussed on premium office space where demand was 39,600 sq/m, representing about 90 per cent of overall demand.

The Brisbane fringe market also saw a drop in vacancies.

Significantly, a supply gap was emerging with no new office space coming on line until 2024.

 

 

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