The Sydney CBD remains in the midst of a harsh property cycle, which is reshaping the city as we know it.
Difficult conditions for landlords and commercial investors mean lower valuations and decreased tenancy. However, Dexus chief executive Darren Steinberg believes this is simply part of a normal 24-month cycle. He also claims that there are another 12 months to go before valuations reset to relatively normal levels.
While many believe that the commercial sector is weathering the storm, so to speak, there is no doubt that a number of landlords are struggling. This is a wonderful opportunity for commercial tenants to obtain office space at a more reasonable price, or to re-negotiate their existing contract for better terms.
What will the CBD look like at the end of the ‘cycle’?
This cycle is expected to end in 12 months, according to the aforementioned property experts. However, this is not guaranteed. In fact, the CBD could be in for permanent change. Some investors, landlords, and government officials have even floated the idea of turning empty office space into apartments for rent. This may well help to solve the current housing crisis.
Alternatively, a range of businesses may elect to take advantage and secure office space at a more affordable price. This would-be rush of tenants is expected to include businesses that would formerly have required say four floors of space. But now, with more employees operating at home, they may only require two, or three floors. The end result may be more businesses in each office tower.
Niche Advisory is here to help
We offer Comprehensive Corporate Real Estate (CRE) Services for tenants of all sizes.
Enlightened CRE decisions are reliant on the contributions of property, design, and project management skills – all of which we have invested in and offer in-house for our clients. Our full-service offering is what we believe every client is entitled to and deserves. Coupled with the opportunities of the current market, we’re here to find the perfect workspace for you.
Niche Advisory enables organisations to unlock and leverage the opportunities that arise from the market itself, and the creation of a new workplace solution – from optimising processes to lifting productivity levels, improving corporate culture, and future-proofing the business.
Book a call with Niche Advisory today.
