Gold Coast office to grow by 20%: Vacancy stable

The Gold Coast office market has maintained a healthy vacancy rate of 6.3%, up from 5.0% in July 2007, despite substantial additions of new stock.

According to the Property Council of Australia’s January 2008 Office Market Report, the Gold Coast office market grew by 3.8% over the past six months, with 21,160 sqm of new space coming online in the Southport (9,160sqm), Broadbeach (2,000sqm) and Robina (10,000sqm) centres.

Queensland Executive Director, Steve Greenwood said the market would continue to grow by almost 20% over the next two years.

“We’ve seen record levels of stock come online in the Southport area during the past six months, with equally strong growth in Robina. Despite this, net absorption of space has still been high.” Mr Greenwood said.

“On top of this growth, there’s another 46,976sqm of space due to come online in 2008, followed by 28,200sqm in 2009.

“That’s a 20% increase on current levels of stock – which shows that the Gold Coast market is keeping up with increased demand from businesses establishing themselves on the Coast.

“The Gold Coast office market is evolving. If it continues to maintain this healthy outlook, it will offer a real alternative to traditional capital city-based business.”

Analysis & commentary, Gold Coast, January 2008

Vacancy analysis:

• Vacancy increased from 5.0 percent to 6.3 percent over the 6 months to January 2008. This was partially due to a substantial addition of 21,160sqm of space
• Net absorption was 8,446sqm, while withdrawals totaled 7,033sqm

By locale:

• Broadbeach – vacancy decreased from 16.4 percent to 15.0 percent. The small size of this sublocale make it susceptible to vacancy movement
• Bundall – vacancy increased marginally from 3.4 percent to 3.7 percent due solely to net absorption of -219sqm
• Southport – vacancy increased from 4.0 percent to 5.9 percent. This was due to 9,160sqm of supply additions, the highest on record for this locale. Net absorption was still a healthy 6,437sqm
• Surfers Paradise – vacancy decreased from 6.6 percent to 3.9 percent due solely to withdrawals totaling 3,988sq m. Net absorption was -1,877sqm
• Robina – vacancy increased from 4.0 percent to 9.0 due to the addition of 10,000sqm of space. Net absorption was 2,128sqm

Snapshot – Gold Coast by grade:

• All grades except for A Grade are below the national Non-CBD vacancy benchmarks
• A Grade vacancy of 11.0 percent was much higher than the national Non-CBD vacancy of 5.5 percent
• B, C and D Grade are at 5.2 percent, 4.8 percent and 6.8 percent vacancy respectively

Future supply:

• 46,976sqm of space is due to come online in 2008, with a further 28,200sqm due to be added to the Gold Coast market in 2009
• A total of 1,196sqm is planned for 2010+ with 17,700sqm mooted
• The space in the pipeline over the next two years will make the size of the market grow by almost 20 percent

Key market indicators, Gold Coast & national markets, January 2008

Key market indicators, Gold Coast (by locale)

Key market indicators, by grade, as at January 2008

Media contact:
Nicole Bisson, Manager Planning and Infrastructure, 07 3225 3004
Nbisson@propertyoz.com.au