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Dexus tips ‘great’ Sydney office market

The group expects solid investment and tenant demand for the city’s office in coming years, says Steinberg.

Dexus is now looking at mixed use opportunities in its pipeline.
Dexus is now looking at mixed use opportunities in its pipeline.

Australia’s largest office landlord, Dexus Property Group, says the office leasing market will be “great” in Sydney over the next few years due to limited supply, reaffirming growth of distribution per security at 2.5 to 3.5 per cent for the current financial year.

Chief executive Darren Steinberg told investors at the annual general meeting today that the company expects to see “solid investment and tenant demand to remain in most markets and to support asset values”.

“In Sydney the supply cycle is now limited which is great for the (office) leasing market over the next few years,” he said.

“One project, the Sydney metro, will result in the withdrawal of a significant amount of office space through the compulsory acquisition of properties to make way for the new station platforms.”

That will include 39 Martin Place, which Dexus owns jointly with Dexus Wholesale Property Fund. The company is currently talking to the NSW government regarding the plan for the tower.

Dexus is now looking at mixed use opportunities in its pipeline, which can be developed and sold for a profit, Mr Steinberg said.

“Our fiscal trading profit guidance of $45-50 million post tax is well progressed, having already sold two properties that will contribute to this result and we are confident that the sale of one of our four remaining priority projects will achieve this target.”

Ahead of the AGM, Dexus appointed property veteran Mark Ford as a new independent non-executive director. He will join the board in November.

Read related topics:Dexus

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Original URL: https://www.theaustralian.com.au/business/property/dexus-tips-great-sydney-office-market/news-story/da5959cccc3620ac803203662393594b