Empty Sydney CBD: 916 empty commercial, retail spaces revealed

Shocking new figures have revealed just how bad things have become in Sydney’s CBD, as workers continue to work from home.

Employees working from home are slacking off at the end of the week – taking long lunches and hosting virtual meetings at the driving range — as Sydney’s CBD is “flatlining” with close to 1000 office and retail spaces lying empty.

New data from McCrindle Research has found employees across Greater Sydney aren’t punishing themselves by working hard on a Friday, and instead loading up their productivity in the office on Tuesday, Wednesday, and Thursday.

Mark McCrindle said mundane domestic tasks, once slogged out at home on a Saturday morning, out of the way on a Friday so they can “focus on fun”.

“People are spreading their work to other parts of the week so that more domestic work and leisure-based activities can be done on a work-from-home day on a Friday.”

Mr McCrindle said employees are “self-reporting that Fridays are now an extension of the weekend”.

But the social demographer said it comes at a cost to the viability of Sydney’s CBD.

“The lack of CBD-based work is not only impacting commercial landlords but also the city’s economy,” he said.

Thornleigh Golf Centre manager Tristan Morey said the northern Sydney driving range is experiencing a major uptick in weekday bookings, as avid golfers “take long lunches during their work-from-home days or even host virtual meetings from the clubhouse before they tee-off”.

The latest commercial property vacancies for the Harbour city reveal 916 retail, hospitality, and office sites sit empty – waiting to be sold or leased – in the Sydney CBD, according to REA Group results.

An increasing number of empty chairs and tables are evident across Sydney's CBD during weekday lunchtimes. Photo: Tom Parrish

Economists are calling for more housing in the CBD to replace commercial floor space in an effort to close the gap on vacancy rates. Photo: Tom Parrish

The mass listing of vacant commercial properties in the CBD comes as research from the Property Council of Australia shows the CBD commercial vacancy rate remains at its highest level in a decade at 12.2 per cent.

Economist Dr Andy Marks said the Sydney CBD was “flatlining” with “no chance of recovery without a plan for reform”.

“Vacancy rates slipping to 12.2 per cent means Sydney’s gone too far,” Dr Marks said. “It would be difficult, nearly impossible, to pull the city back from the brink without converting commercial floor space in the heart of the city into residential.”

Economist Dr Andy Marks. Picture: NCA NewsWire/ Monique Harmer

Dr Marks said a mass conversion of vacant commercial space to meet the state’s dire housing crisis, “is the only way to bring life back to the city”.

“The best cities in the world are lived in, they aren’t visited from 9am to 5pm four days a week,” he said. “New York, Tokyo, Mumbai and London have far higher proportions of residential dwellings than the Sydney CBD.”

Dr Marks said Sydney needed to introduce more housing, like New York City. Photo - iStock

View of Tokyo skyline at sunset in Japan. Photo - iStock

Dr Marks said the lacklustre vacancy rates meant the CBD was losing its status as the “economic centre of gravity” to its neighbours in the west.

Meanwhile, Tenant CS data analyst Liam Drosinos sounded the alarm that commercial vacancy rates could get even worse this year, as more than 150,000sq m of additional office space comes online.

Data provided by Transport for NSW data shows fewer workers were travelling through city circle stations on Fridays in June this year than in June 2023.

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