Office vacancy rate on Gold Coast falls lower with further drops predicted as market bounces back from spike last year

New figures reveal the office vacancy rate on the Gold Coast is falling fast for two very important reasons.

STRONG demand from expanding businesses and limited supply should see the office vacancy rate on the Gold Coast fall further this year after blowing out to 12 per cent last year.

The latest figures from the Property Council of Australia for the six months to January show the vacancy rate dropping to 11.6 per cent with the Glitter Strip leading the way with 1.5 per cent shaved off the amount of vacant office space.

In the six months to July last year it increased from 10.6 per cent to 12 per cent — breaking a positive run of nine years of net absorption.

That increase in the vacancy rate was due to 6000sq m of new space coming to the market in Robina.

In contrast, the PCA expects just 2832sq m of space to come online this year.

New office space at the Oasis Shopping Centre in Broadbeach has pushed up the vacancy rate.

PCA Queensland executive director Chris Mountford said the market has shown strong signs of growth in the wake of the Commonwealth Games last year, which saw a drop off in activity in the lead up and aftermath.

“Figures from the 2019 report show a healthy office market with positive tenant demand and

good level of net absorption,” he said.

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“Rather than scaling back post-Commonwealth Games, the region has defied the nay-sayers and continued its growth trajectory.”

The vacancy rates dropped in Robina/Varsity Lakes (down to 12 per cent), Southport (down to 13.6 per cent) and Surfers Paradise (down to 9.8 per cent) while it rose in Broadbeach and remained steady in Bundall.

Doug Garvie, commercial division manager at Savills Gold Coast says market sentiment is positive.

“With little new stock on the horizon for 2019, we can expect vacancy rates to tighten

throughout the year, putting the Gold Coast in a strong position going forward,” Mr

Mountford said.

Savills Gold Coast division manager Doug Garvie said market sentiment is positive with quality tenants reaching out, either for new or expanding businesses, to find space.

“Last year was a bit of a struggle but this year started positively with a lot more inquiries from people looking to go into Southport,” he said.

He said he is working on a deal to lease 500sq m of space in the CBD.

“The Federal election will slow things up in the first half but I’m expecting the second half of the year to pick up.”

CBRE Gold Coast director of office leasing Nick Selbie said he expects the vacancy rate to drop further to about 10 per cent, stimulating new construction.

“Those projects with precommitments secured or those short-listed for major and current market briefs will capitalise and will likely deliver additional space to those sites,” he said.

“The first to market will secure the tenants and research suggests that around 10,000sq m-15,000sq m could be added and absorbed in the next 12-18 months.”