Knight Frank / House Views Report / Q3 October 2022 /
Knight Frank / House Views Report / Q3 October 2022 / 7
Office Overview.
• With a lack of transactional evidence, market feedback suggests that yields for offices have softened over the September quarter. • Despite this, assets with good growth prospects, e.g long WALE assets with secure tenures, are expected to remain steady and possibly witness capital growth over the next 12-24 months. • With a tightening labour market, employers seeking high quality candidates are trending towards offering flexible or ‘hybrid’ roles which include an element of working from home as a routine component of the employees working schedule. This shift has seen an impact space requirements for many businesses who historically have operated on occupancy ratios of 1:10sqm per employee.
Office Market (sub $10m)
Improved Rates $/m2 NLA
Investment Yields
Market Rates
Incentives Vacancy
A
B
A
B
A
B
5.25% - 6%
5.5% - 6.5%
$425 - $460
$325 - $360
$7,000 - $8,000
$4,000 - $5,000
15% - 30%
Newcastle CBD
15%
5.25% - 6%
5.5% - 6.5%
$350 - $450
$250 - $350
$6,000 - $7,000
$4,000 - $5,000
10% - 20%
Charlestown CBD
10%
The figures in the above table assume a WALE of 5 years.
SDkayrbRyePsliadzeance, 280 King Street, Newcastle NSW 352 Hunter Street, Newcastle
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