Brisbane's fringe the place for office rental in the city
Those on the hunt for commercial real estate may want to look at Brisbane's fringe, according to a recent report from advisory firm m3property.
The Brisbane Fringe Office Market report for winter 2014 outlines how the city's fringe has become increasingly important to its office market over the preceding decade. The relative affordability of fringe areas along with the greater availability of space compared to the central city have driven tenants to prime-grade buildings over the last five years.
The effects of demand are evident in the figures coming out of the Brisbane fringe. Total office stock in the area increased by a massive 61.5 per cent over the previous 10 years, nearly double the increase seen in the CBD. That's nearly 436,000 square metres of new property.
Investors with office property in the Inner South will want to take advantage of the relatively tight vacancy rate of 4.3 per cent in the Inner South sub-locale, which has pushed rent higher than other parts of the fringe.
High profile relocations abound
A large proportion of firms on the hunt for commercial offices for lease in Brisbane have indicated the fringe as a potential location in their tenant briefs.
In fact, the last year saw firms such as Laing O'Rourke, Macquarie Bank, and Ergon Energy move their offices from the CBD over to the fringe, with more on the way. Flight Centre, Bank of Queensland and industrial software supplier Ventyx are all planning to move to the fringe during 2014 and 2016, according to the report.
If business confidence continues to remain steady, it is likely that more and more companies will seek out office space in the Brisbane fringe, whose standalone office workforce has averaged an increase of nearly 6 per cent each year in the last 10 years.
Opportunities abound in the fringe
The Brisbane fringe is the largest non-CBD office market in Australia, providing plenty of prospects for office rental. As of January 2014, the area made up 35 per cent of space in the Brisbane office market, or 1,176, 675 square metres of floor space. Nearly half of this stock is A-grade quality.
Even more significantly, this space is growing. Just over 50,000 square metres of new A-grade space made it to the fringe market during 2013, and there is currently 71,428 square metres of new supply under construction.