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Canberra CBD : Weak demand a brake on rental growth - Q3 2014

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Canberra CBD : Weak demand a brake on rental growth - Q3 2014

The national economy decelerated over Q2 2014, with growth of 0.5% compared to 1.1% in Q1. Strong growth earlier in the year is attributed to improvements in the housing construction sector and increased retail spending. These positive results supported a rebound in consumer sentiment; however trajectory changed once again, given the softer Q2 figures.

Over the 12-months to July 2014, Canberra’s office market received stock additions of 104,288 sq m. The majority of this (71%) was completed in the second half of 2013, and was predominantly new A-grade space. The lack of demand drivers has served as a brake on future supply, with 56,829 sq m currently under construction. This is almost half of the 10-year annual average of 112,159 sq m. At this stage, none of this space has received a pre-commitment. Looking ahead, limited demand drivers from key occupiers (e.g. Government and related service providers) will continue to limit new supply.

Source : DTZ

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