Parramatta retains number one position with lowest office vacancy in NSW

Parramatta continues to be one of Australia’s strongest emerging commercial office markets, according to the Property Council of Australia’s Office Market Report released today.

The office vacancy rate in Parramatta stands at 3.2 per cent, a 0.4 per cent change from the last report published in July 2019, with Parramatta’s performance ahead of all other commercial office centres in the state.

Key market indicators, Parramatta (aggregate)

Grade

Vacancy,

Jan 20 (%)

Vacancy,

Jul 19 (%)

Net absorption, 6 months to

Jan 20 (sqm)

A

0.4

0.5

62,301

B

3.4

2.3

-11,076

C

9.0

7.1

-3,907

D

4.4

4.5

-117

Total

3.2

2.8

47,201

 

“Paramatta is performing well as a destination for new office space, with new construction projects bringing additional office space online and businesses moving in as soon as the ribbon is cut,” said Property Council of Australia’s Western Sydney Regional Director Ross Grove.

“Parramatta recorded the strongest net demand for office space over the six months to January 2020 - over eight times its historic average. This is mainly due to Walker Corporation’s Parramatta Square 4 tower coming online late last year.

“Demand from Government tenants and professional services construction is ensuring vacancies are tight and the improved connectivity will ensure there is a strong pipeline of demand into the future to support a number of office developments already underway.

“New infrastructure projects such as Parramatta Light Rail and the Sydney Metro West as well as the growth of Westmead means the area is well placed for further commercial office investment into the future.”

 

Office Market Report January 2020

Analysis – Parramatta market

 

Headline comments:

  • Total vacancy in the Parramatta office market marginally increased over the six months to January 2020
  • This was due to substantial supply additions
  • Demand was still positive and concentrated in the A Grade segment
  • There is steady stream of space in the pipeline over the short to medium term

 

Vacancy analysis:

  • Vacancy increased from 2.8 percent to 3.2 percent
  • This was due to 62,174sqm of supply additions
  • Demand was still positive with 47,201sqm of net absorption recorded
  • 10,528sqm sqm of space was withdrawn over the period

 

By grade:

  • A Grade – vacancy decreased from 0.5 percent to 0.4 percent due to 62,301sqm of net absorption
  • B Grade – vacancy increased from 2.3 percent to 3.4 percent
  • C Grade – vacancy increased from 7.1 percent to 9.0 percent due to -3,907sqm of net absorption
  • D Grade – vacancy marginally decreased from 4.5 percent to 4.4 percent

 

Future supply:

  • 73,513sqm of space is due to come online in 2020
  • This will be followed by 28,000sqm in 2021
  • 45,700sqm is due to come online from 2022 onwards
  • 157,643sqm of stock is mooted

 

Media contact: Ross Grove | M 0412 897 130 | E rgrove@propertycouncil.com.au