Gold Coast office vacancy remains high

The Gold Coast’s office vacancy achieved a slight decrease over the six months to July 2012, but still remains the highest in the country, according to the Property Council of Australia’s latest Office Market Report.

Vacancy tightened marginally over the period, from 22.0 percent to 21.5 percent, driven by both withdrawals and absorption, Queensland Executive Director of the Property Council of Australia Kathy Mac Dermott says.

“A total of 4292sqm was added over this period, which was almost balanced out by withdrawals of 3,453sqm and absorption of 2723sqm,” Ms Mac Dermott says.

“All grades, except for B Grade, experienced slight vacancy decreases over this period.”

“With only 1723sqm due to come online in the second half of 2012, this should provide the market with further room for absorption.”

“Over the six-month period, vacancy in Broadbeach decreased to 11.1 percent from 16.8 percent, significantly lower than the 30.3 per cent vacancy rate recorded at the same time last year.”

“The Southport and Robina-Varsity Lakes markets experienced little change, with decreases of 0.7 and 1.0 percentage points, respectively.”

“Both Bundall and Surfers Paradise saw vacancy increases, with Bundall up by 0.8 percentage points to 32.1 per cent, its highest level in more than 19 years. The Surfers Paradise vacancy rate increased by 1.6 percentage points over the six months, to reach a staggering 28.5 per cent.”

“While certain markets across the Gold Coast remain depressed, Broadbeach is edging towards healthy vacancy levels. As work on major projects such as the Commonwealth Games and the Gold Coast Rapid Transit increases, this will help the market will begin its gradual recovery.”

Headline comments:

• Vacancy in the Gold Coast office sector decreased over the six months to July 2012
  
• The B Grade segment was the only grade to experience a vacancy increase
  
• All locales have vacancy of at least 11 percent
  
• There is a little space in the pipeline over the short to medium term
  

Vacancy analysis:

• Vacancy decreased from 22.0 percent to 21.5 percent over the 6 months to July 2012
  
• The vacancy decrease was due to withdrawals of 3453sqm and net absorption of 2723 sqm
  
• 4292 sqm of space was added to the market over the period
  

By grade:

• A Grade: vacancy in this segment decreased from 25.9 percent to 25.6 percent
  
• B Grade: vacancy increased from 19.9 percent to 20.7 percent due solely to net absorption of -2934 sqm
  
• C Grade: vacancy in this segment decreased from 21.1 percent to 18.8 percent due to net absorption of 1760 sqm and withdrawals of 1730 sqm
  
• D Grade: vacancy decreased from 22.4 percent to 20.7 percent over the period due solely to net absorption of 287 sqm
  

By locale:

• Broadbeach: vacancy decreased from 16.8 percent to 11.1 percent. This was due to withdrawals of 1723 sqm and net absorption of 130 sqm
  
• Bundall: vacancy increased from 31.3 percent to 32.1 percent due solely to net absorption of -719 sqm. This vacancy rate is the highest in over 19 years
  
• Southport: vacancy decreased from 17.4 percent to 16.7 percent due to withdrawals of 1730 sqm and net absorption of 1527 sqm
  
• Surfers Paradise: vacancy increased from 26.9 percent to 28.5 percent due to solely to net absorption of -1126 sqm
  
• Robina-Varsity Lakes: vacancy decreased from 19.6 percent to 18.6 percent due solely to net absorption of 2,911 sqm
  

Future supply:

• 1723 sqm of space is due to come online in the second half of 2012
  
• 7130 sqm is in the pipeline for 2013
  
• From 2014 onwards 3074 sqm of space is due to be delivered to the market
  

Key market indicators, Gold Coast (aggregate)

Key market indicators, Gold Coast (by locale)

Media Enquiries:

Kathy Mac Dermott
Property Council Queensland Executive Director
0427 243 986

For full analysis and coverage, visit the dedicated website: www.officemarketreport.com.au