Sydney CBD Office Figures Q3 2024

Key Points: 

• Leasing demand has remained steady across the Sydney CBD in 2024, although at lower levels than 2023.
• While no new office supply was delivered to the Sydney CBD over H1 2024, the second half will see the completion of over 187,000 sqm of new stock.
• The overall CBD vacancy rate ended the first half at 11.6%. This marked a decline of -60 bps from year-end 2023. Sydney CBD Prime and Secondary vacancy rates both declined in H1 2024, ending the period at 11.9% and 11.1%, respectively.
• Despite continued growth in face rental rates, increases to incentives in vacancy challenged precincts resulted in the CBD average net effective rental rate figures declining in Q3 2024.
• The Sydney CBD saw investment volumes reach AUD 924.2 million over the third quarter. This marked the second largest quarter of investment activity in the last two years. Cap rates increased marginally in Q3 2024, although yields now appear to be nearing their peak.