Driven by the downsizing and relocation of companies, this trend is expected to push up the vacancy rate in cities across the country, and as incentives increase, this will eventually put pressure on value.
Charter Keck Kramer’s country director Steve Kingston said that as tenants begin to make critical decisions about the space needed, sublet vacancies in Sydney and Melbourne are likely to appear in the last quarter of this year. The sublease data reveals a broader prospect of the overall health of the office market by revealing the completely occupied space in the CBD.
As existing leases have been completed and new deals have been concluded, this data can be used as a forward indicator of weakening tenant demand. According to data from the Real Estate Council, it is expected that 100,000 square meters of new inventory will enter the Melbourne CBD in the second half of 2020, which is equivalent to more than 2% of the newly added CBD to obtain vacancies only through subletting.
https://theurbandeveloper.com/articles/-cbd-tenant-demand-sags-as-sub-leasing-surges