Office occupancy begins its long journey back as confidence builds in Melbourne’s CBD
Embargoed until 12.01am, Tuesday 9 February 2021
Melbourne’s office occupancy rate increased to 31 per cent in January but still lags the nation following Victoria’s extended lockdown and prolonged work from home orders throughout 2020.
The Property Council of Australia’s periodic Office Occupancy Survey shows an increase from 13 per cent in December, after reaching a low of 7 per cent in October, and reflects a renewed confidence and the Victorian Government’s safe and progressive roadmap to the reopening of offices.
Melbourne’s office occupancy levels fall behind Sydney’s, which sits at 45 per cent. All other capital cities currently enjoy occupancy levels greater than 60 per cent.
Only a small percentage of survey respondents consider that workplace safety concerns are contributing to lower occupancy levels, whereas over 20 per cent consider public transport safety and capacity concerns to be influencing occupancy and nearly 40 per cent cite changed workplace preferences.
Over 50 per cent of survey respondents think that it will take more than 3 months to see a material increase in occupancy levels.
Office occupancies are calculated on whether a tenant’s employees are occupying the space or working from home, not whether a lease is in place. The Property Council has been surveying our members who specialise in the office sector to track progress in the return to office.
This week’s Occupancy Survey release follows last week’s important Property Council of Australia Office Market Report, which showed that Melbourne’s office vacancy had reached 8.2 per cent, reflecting an influx of new office supply and an increase in subleasing activity.
In addition to the bi-annual Office Market Report, the Property Council of Australia is actively tracking office occupancy data through our periodical Office Occupancy Survey. All data collected across Australia’s capital cities, has been aggregated to provide a market-by-market consensus overview. The next edition of this survey is due to be released at the start of March.
The Property Council of Australia’s Office Market Report and Office Occupancy Survey are nation-leading, in depth analysis of Australia’s office vacancy and occupancy levels. The Property Council of Australia is actively using these data sources to advise and inform the Victorian Government’s return to office roadmap.
Quotes attributable to the Property Council of Australia’s Victorian Executive Director, Danni Hunter
“It’s pleasing to see that a consistent run of positive health results and the State Government’s loosening of restrictions that have capped the number of workers permitted to return to a workplace, has resulted in more and more Victorians returning to the office.
“We commend the Government for its safe and progressive steps to allow Victorians to reunite with their workmates since November last year. When public health advice has required it, that return has been paused, but for a reasonable and proportionate period before we’ve returned to the plan. This sensible approach has built an underlying confidence in the mindset of Victoria’s office community that they can safely return to their workplaces.
“As more and more Victorians return to the office after the summer break and the end of school holidays, we are confident that they will experience firsthand the benefits of collaboration, productivity and positive team culture and begin to fall in love with Melbourne’s CBD yet again.
“According to The Economist, for every one knowledge worker, there are five jobs which are supported by that worker’s attendance at the office. The Property Council’s Occupancy Survey results show just how important it is for the future of Melbourne’s CBD, that Victorians know that our office environments are both COVID-Safe and extremely attractive places to be.”
Matthew Kandelaars | M 0416 443 555 | E [email protected]