With general business confidence improving, and hybrid working arrangements being adopted by many organisations, we are expecting office leasing demand will increase over the next year. Small to medium businesses are likely to be on the move, across numerous industries, with sub 300sqm market to be the most in-demand.
We anticipate some businesses will be relocating out of the city and into fringe areas, with technology playing a big part in this allowing teams to continue to communicate remotely. Upgrading office premises is another key trend. With reducing space needs businesses are relocating funds into finding better-quality office space to attract and retain staff.
Lease renewals are likely to remain a popular option for those businesses that do not have the budget for relocation or new fit-outs. Many business owners are likely to seek new options through agents, then take those terms back to their existing landlord and use the big incentives on offer to negotiate a better deal to stay.
In the first quarter of 2022, the enquiries, inspections and deals have steadily increased whilst the vacancy has steadily declined, demonstrating a positive upward trend of commercial business returning to the CBD and City Fringe as we exit out of COVID 19 pandemic restrictions.
Business owners are more astute to their requirements as they adapt to changing working environments, particularly flexible work-from-home arrangements. This has led to either a reduction in size requirement and demand for higher quality stock or a rethink of the configuration requirements, looking for more collaboration, breakout and meeting room space versus traditional desk space.
In 2021 there was a lot of uncertainty in the Sydney office market because of extended lockdowns. Most businesses were looking to downsize due to the majority of their staff working from home. Many businesses retained their staff, but they were alternating days and hot-desking whilst in the office, so the office space was mostly underutilised.
TGC team leasing deals in 2021 included mostly commercial office space across Sydney CBD and fringe, with the average deal size being about 340sqm.
If you are looking to lease out or occupy a commercial space in Sydney, get in touch with our leasing experts via 1300 458 800 or firstname.lastname@example.org. Our team can also assist you with tailored sales and property management services.