For most new apartment buildings, the Owners Corporation starts life with little more than a bank account and the first quarterly strata levies.

At <a href="https://www.apartments.com.au/buildings/9-gay-street-castle-hill-9-gay-street-castle-hill-nsw-2154">9 Gay Street</a> in <a href="https://www.apartments.com.au/developments/castle-hill-nsw-2154">Castle Hill</a>, it starts with around $7 million in reserve.

It's an unusual legacy of what was once one of Sydney's highest-profile apartment remediation projects. When the development, originally known as Skyview and built by disgraced developer Top Place, came under scrutiny by then NSW Building Commissioner David Chandler, an $11 million remediation bond was negotiated to ensure any building defects could be fully rectified.

The building underwent an 18-month remediation program, during which around $4 million of that bond was spent bringing the building up to the standard it should have been in from the outset.

After extensive inspections, all active rectification orders have been lifted. What's more, around $7.2 million remains secured for the Owners Corporation for the next 15 years.

In a twist few would have predicted, what began as a significant concern for purchasers has left the building with something almost unheard of in the apartment market: a multi-million-dollar financial reserve from day one.

[smartcode_project:default project_id=147685 project_image_fid=359136]

<a href="https://www.apartments.com.au/project-marketer/equitifund-group">Equitifund</a> Executive Chairman Greg Huxley said the structure offers buyers a level of certainty that is difficult to replicate.

"The $11 million bond established for the Skyview Castle Hill development represents exceptional value, providing genuine financial security for purchasers," Huxley said.

"Unlike a standard insurance policy, this bond consists of real funds held in trust for the Owners Corporation, offering a tangible layer of protection and added peace of mind."

The apartments themselves have been designed with a focus on practical, contemporary living. Interiors feature Smeg appliances, stone benchtops, tiled living areas, carpeted bedrooms, 2.7-metre ceilings, floor-to-ceiling glazing, and ducted heating and cooling throughout.

Residents also have access to a range of shared amenities, including two rooftop barbecue areas, a swimming pool, children's playgrounds, secure building access, storage cages, and visitor parking.

The location continues to be one of the project's strongest drawcards. Castle Hill Metro Station sits virtually on the doorstep, providing direct connections across Sydney's expanding Metro network, while Castle Towers offers extensive retail, dining, entertainment, and service amenities within walking distance.

[smartcode_project:default project_id=147685 project_image_fid=359127]

The building, now named after its location at 9 Gay Street, comprises a diverse mix of one-, two-, and three-bedroom apartments starting from just under $600,000.

Equitifund National Sales Director Ben Hamblett said demand in the Hills District continues to be driven by buyers seeking convenience and connectivity.

"Interest from both owner-occupiers and investors in Castle Hill remains exceptionally strong, with buyers consistently prioritising developments in close proximity to the Metro station and Castle Towers Shopping Centre," Hamblett said.

"There is a clear trend in the market, with purchasers seeking convenient access to transport and lifestyle amenities that support a seamless, low-maintenance way of living."

On top of the long-term protection afforded by the remaining $7.2 million bond, Equitifund is offering a limited-time stamp duty rebate on selected apartments.

Eligible purchasers can also secure finance options, including a 3.99 per cent two-year variable rate, loan-to-value ratios of up to 90 per cent, and interest-only lending options through EquitiCredit.

[smartcode_project_cta:default project_id=147685]

Joel Robinson

Why this Castle Hill apartment building starts with a $7 million advantage

For much of the past few years, conversations about Australia's property market have centred on the rapid growth seen in Sydney, Brisbane, Gold Coast, and Perth. <a href="https://www.apartments.com.au/developments/melbourne-vic-3004">Melbourne</a> has followed a different trajectory.

That relative underperformance is now encouraging some buyers to reassess the city, particularly those willing to look beyond short-term market movements and focus on quality property in established locations, along with the long-term growth prospects of a city expected to overtake Sydney as Australia’s most populous.

John Bekiaris, Research &amp; Market Insights at <a href="https://www.apartments.com.au/project-marketer/equitifund-group">Projects by Equitifund</a>, said Melbourne's current position is attracting increasingly sophisticated purchasers.

"Melbourne continues to present one of Australia's strongest long-term investment stories," Bekiaris says.

"While other capital cities have experienced stronger recent growth, that relative underperformance is exactly what's attracting sophisticated counter-cyclical investors."

[smartcode_project:default project_id=1979 project_image_fid=363268]

Equitifund isn't just commenting on Melbourne's property market, it's investing in it.

The Sydney-headquartered capital partner has taken over the remaining apartments at <a href="https://www.apartments.com.au/buildings/victoriana-melbourne-20-queens-road-melbourne-vic-3004">Victoriana</a>, the recently completed glass-encased development opposite Albert Park Lake in Melbourne's tightly held St Kilda Road precinct.

Designed by <a href="https://www.apartments.com.au/architects/rothelowman">Rothelowman</a> and built by <a href="https://www.apartments.com.au/builders/hickory">Hickory</a>, Victoriana places residents between one of Melbourne's most recognised parklands and the CBD, offering oversized two and three-bedroom apartments aimed at owner-occupiers seeking a genuine alternative to a traditional family home.

The development comprises 232 completed residences alongside a suite of resident amenities, including a 25-metre indoor swimming pool, gymnasium, landscaped entertaining areas, resident lounges, EV charging, secure basement parking and a concierge-style arrival experience.

[smartcode_project:default project_id=1979 project_image_fid=363229]

The apartments have been designed with owner-occupiers firmly in mind.&nbsp;Open-plan living and dining areas flow onto generous balconies framing views across Albert Park Lake, Fawkner Park, the Royal Botanic Gardens and the Melbourne skyline.

Kitchens feature Gaggenau appliances, stone benchtops and generous preparation space. Bedrooms include built-in robes, while bathrooms feature full-height textured tiling. Hardwood flooring and ducted air conditioning complete residences designed for long-term living.

Rothelowman's architecture takes its cues from the landscape opposite the site. Sweeping horizontal glazing references the movement of Albert Park Lake, while generous balconies and expansive glazing strengthen the connection between the apartments and the surrounding parklands. The result is a building designed to deliver the scale and amenity expected of luxury apartment living, while offering the larger floorplans increasingly sought by owner-occupiers.

[smartcode_project:default project_id=1979 project_image_fid=363284]

The location is one of Victoriana's defining characteristics. Positioned on Queens Road, residents are directly opposite Albert Park Lake and within easy reach of Fawkner Park, the Royal Botanic Gardens, South Melbourne, St Kilda Road and the CBD. With few comparable development opportunities remaining in the precinct, buyers are increasingly placing value on outlooks that are unlikely to be interrupted by future construction.

Greg Huxley, Founder of Equitifund, believes those qualities become even more valuable over time.

"Premium real estate has always rewarded buyers who take a long-term view," Huxley said.

"Victoriana represents the kind of asset that's increasingly difficult to recreate today, particularly in an established location like Queens Road."

He said rising construction costs are also changing the way buyers assess completed developments.

"When you combine an irreplaceable location with thoughtful architecture and premium finishes, you create something that becomes increasingly difficult to reproduce as construction costs continue to rise."

[smartcode_project:default project_id=1979 project_image_fid=363228]

According to National Sales Director Ben Hamblett, enquiry has been driven largely by Melbourne downsizers and buyers upgrading from smaller apartments.

"Interest in Victoriana continues to build, with strong buyer focus on the larger owner-occupier residences within the development," Hamblett says.

"Enquiry is increasingly driven by local buyers who recognise the rarity of what's on offer: park-facing apartments in an established neighbourhood where new development opportunities are becoming increasingly scarce. At Victoriana, the view is not just a feature; it's an appreciating asset in its own right."

He said interstate enquiry has also strengthened as buyers reassess Melbourne's position within the national property cycle.

"Melbourne currently stands as the most compelling entry point of any major Australian capital, and discerning buyers are beginning to recognise what those who move early always understand: the best opportunities are taken before the price rise confirms them."

[smartcode_project_cta:default project_id=1979]

Why now is the time to buy in Melbourne's premium apartment market

Developers and apartment buyers have a narrowing window of opportunity before Brisbane's Olympic infrastructure pipeline begins competing directly with residential construction, pushing up costs, tightening labour supply and making new projects increasingly difficult to deliver.

While Brisbane's apartment market continues to benefit from strong population growth and limited housing supply, industry research suggests the years leading up to 2027 could prove to be the most important period for developers looking to secure builders and buyers hoping to purchase before the next wave of price increases.

A new Colliers report, Brisbane 2032 Olympic and Paralympic Games: Creating Solutions, highlights the scale of the challenge. While thousands of new homes are planned across South East Queensland, the Brisbane Olympic Athletes Village alone will deliver more than 10,500 beds during the Games before being converted into around 1,750 to 2,000 apartments. Equivalent to almost two years of typical inner-city apartment supply, the project will also absorb a significant share of the construction workforce and building materials.

The broader construction pipeline paints an even clearer picture.

Construction Skills Queensland's Horizon 2032 report forecasts Queensland's annual construction pipeline will average $69 billion over the coming years before peaking at $75 billion in 2027-28. Demand for construction workers is expected to increase by 17 per cent to almost 150,000 people, with the industry facing an annual shortfall of around 19,000 workers that could blow out to as many as 35,000 during the peak construction period.

The Olympic venues, athletes village and supporting infrastructure will account for billions of dollars worth of work across South East Queensland through to 2032, creating intense competition for labour at a time when Australia's residential construction sector is already under pressure.

[smartcode_project:default project_id=150489 project_image_fid=373834]

Colliers Queensland Residential Director Andrew Scriven said the convergence of these projects is creating a clear window of opportunity for both developers and buyers.

"From 2027 onwards, the market will shift dramatically," Scriven said.

"Labour will increasingly be locked into government-led infrastructure and Olympic projects, which means private residential developments will face higher costs and tighter margins. The developers who move now are the ones most likely to get projects off the ground."

Scriven said the same dynamic would also affect buyers, with fewer apartment projects expected to launch once construction capacity tightens.

"If you're looking to change your lifestyle over the next five years, now is your window of opportunity to buy."

[smartcode_project:default project_id=150713 project_image_fid=373827]

Developers are already positioning themselves ahead of that window.

Following the success of Monarch at Toowong, Consolidated Properties is preparing to launch two new Brisbane apartment projects in the second half of 2026. They include <a href="https://www.apartments.com.au/new-apartments/gloriette-30-bedivere-street-yeerongpilly-qld-4105">Gloriette</a> at Yeerongpilly Green, a 25-storey tower within one of Brisbane's key Olympic precincts, and <a href="https://www.apartments.com.au/new-apartments/castile-47-skyring-terrace-newstead-qld-4006">Castile</a>, a recently approved 25-storey riverfront development at 47 Skyring Terrace in Newstead.

Hutchinson Builders will deliver both projects, with early works already underway at Yeerongpilly and Newstead expected to commence later this year.

The timing comes as Brisbane's fundamentals continue to strengthen, with strong interstate migration, population growth and vacancy rates remaining below 1.5 per cent.

Colliers Queensland researcher Pragya Sharma said Greater Brisbane is forecast to require around 40,000 new apartments between 2021 and 2031.

"There's a real mismatch emerging between when housing is needed and when it will be feasible to build," Sharma said.

"As a result, the period leading up to 2027 presents a key window of opportunity for developers to secure approvals, funding and construction capacity, while buyers will have greater choice before supply constraints intensify."

Colliers research outlines a critical pre-2027 window to start residential projects before labour squeeze: now is the time to buy

Developers, buyers on watch in South East Queensland ahead of construction crunch: Colliers

It's taken less than nine months for developer Sherpa Property Group to sell out all 51 apartments in its <a href="https://www.apartments.com.au/new-apartments/flourish-oasis-palm-beach-7-9-sixth-avenue-palm-beach-qld-4221">Flourish Oasis</a> development in <a href="https://www.apartments.com.au/developments/palm-beach-qld-4221">Palm Beach</a>, over a year before its anticipated completion.

&nbsp;

Located at 7-9 Sixth Avenue, the $67 million development has resonated strongly with both local owner-occupiers and downsizers seeking high-quality apartments within walking distance of the beach, dining precincts and everyday amenities.

[smartcode_project:default project_id=151449 project_image_fid=357458]

Christie Leet, Founder of <a href="https://www.apartments.com.au/developers/sherpa-property-group">Sherpa Group</a>, said the sell-out reflected both the strength of the Palm Beach market and the success of Sherpa's community-first approach to development.

"The sell-out of Oasis is a fantastic outcome and reinforces the strong demand we're seeing for thoughtfully designed apartments in lifestyle locations," Leet said.

"From the outset, our vision was to create a development that genuinely enhanced the Palm Beach community while providing residents with exceptional homes and wellness-focused amenities.

"We've been incredibly encouraged by the level of local support throughout the campaign, 72.5 per cent of buyers are locals, with a significant proportion of purchasers choosing Oasis as their future home rather than an investment."

[smartcode_project:default project_id=151449 project_image_fid=357463]

Construction is now progressing following development approval, with trusted builder LPS Group delivering the project and completion anticipated in Q3 2027.

Oasis forms part of Sherpa Group's successful Flourish collection, which has become recognised for its focus on wellness, community and elevated coastal living.

[smartcode_project:default project_id=151449 project_image_fid=357469]

Residents will have private access to a rooftop amenity space featuring a pool, gym, sauna, steam room, hot and cold plunge pools, spa and barbecue facilities.

"The success of Oasis demonstrates that buyers continue to prioritise quality, location and lifestyle," Leet said.

"We are proud to have delivered a project that has resonated so strongly with the market and look forward to bringing Oasis to life for our future residents."

Sherpa recently launched <a href="https://www.apartments.com.au/new-apartments/flourish-soleira-palm-beach-1150-1160-gold-coast-highway-palm-beach-qld-4221">Flourish Soleira</a>, its third instalment of the Flourish brand in Palm Beach following Flourish Oasis and <a href="https://www.apartments.com.au/new-apartments/amargo-6-12-sixth-avenue-palm-beach-qld-4221">Flourish Amargo</a>.

[smartcode_project_cta:default project_id=151449]

Sherpa sells out Flourish Oasis in booming Palm Beach

Urban Property Group's <a href="https://www.apartments.com.au/new-apartments/la-vera-macquarie-park-94-talavera-road-macquarie-park-nsw-2113">La Vera</a> is leading the next phase of Macquarie Park's residential evolution, with the new apartment development set to become the first of several new apartment projects in the precinct to complete.

The 169-apartment building has now topped out ahead of its scheduled completion in the third quarter of 2026, as new residential investment continues to reshape one of Sydney's largest employment hubs into a true mixed-use precinct.

[smartcode_project:default project_id=134951 project_image_fid=368645]

Cox Architecture has designed La Vera to capture the best of its unique positioning on Talavera Road, orienting the building towards Lane Cove National Park.&nbsp;The building features a sculpted northern façade with flowing curves inspired by the surrounding landscape, while its city-facing elevation adopts a more structured architectural expression to maximise skyline views.

"The vision for the project was to conceive a building that adopted an organic and curvilinear form to the northern portion that faces the Lane Cove National Park," <a href="https://www.apartments.com.au/architects/cox-architecture">Cox Architecture</a> Director Felipe Miranda said.

"The residents that reside in the northern portion of the building benefit by having beautifully crafted curved balconies that speak to the natural context and heighten the relationship of their internal living spaces to the external balconies."

[smartcode_project:default project_id=134951 project_image_fid=358802]

La Vera offers a diverse mix of one, two, three, and four-bedroom configurations, with prices currently starting from $740,000. Buyers so far have been a mix of Sydney-based investors,&nbsp;metro commuters, owner-occupiers and downsizers from surrounding North Shore suburbs.

Both investors and owner-occupiers have been drawn to La Vera's proximity to Macquarie University, Macquarie University Hospital, Macquarie Centre and the Sydney Metro, infrastructure that supports both strong rental demand and a convenient lifestyle for residents.

The apartments feature full-height glazing, timber flooring throughout living areas, stone kitchen benchtops, SMEG appliances, floor-to-ceiling bathroom tiling and ducted air conditioning.

Residents will have access to a rooftop recreation level featuring a swimming pool, sauna, barbecue facilities and landscaped relaxation areas, complemented by additional communal space at ground level. Many apartments enjoy uninterrupted views across Lane Cove National Park, reinforcing the project's connection to its natural setting.

[smartcode_project:default project_id=134951 project_image_fid=364551]

<a href="https://www.apartments.com.au/developers/urban-property-group">Urban Property Group</a>, a family-owned developer and builder with nearly four decades of experience, holds a 4.5-star iCIRT rating and was Australia's first developer to introduce 10-Year Latent Defects Insurance (LDI). La Vera is the first apartment development in <a href="https://www.apartments.com.au/developments/macquarie-park-nsw-2113">Macquarie Park</a> approved to offer the additional insurance protection, alongside a five-year warranty on SMEG appliances.

Urban Property Group CEO Patrick Elias said the additional protection reflects changing buyer expectations in the off the plan market.

"Consumers are a lot more weary and a lot more concerned in buying off the plan than they ever have been. Having LDI is a tool to portray the confidence that we have in our product, and a confidence we want buyers to share," Elias said.

Following completion of the building later this year, buyers will move into their apartments well before Christmas.

[smartcode_project_cta:default project_id=134951]

La Vera closes in on completion as Macquarie Park continues residential transformation

Office Market

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Melbourne, which was perched at approaching the peak of the office market in valuation firm Herron Todd White's April update, continues to have the second lowest vacancy rate amongst all of Australia’s CBDs.
According to the Property Council of Australia’s Office Market Report, Melbourne CBD’s office overall vacancy rate has improved from 7% to 6.4% over the six months to January 2017.
A net absorption of 109,612 square metres in the CBD was recorded in the six months to January 2017 and a total of 40,246 square metres of new stock is due to enter the market in 2017. 
The decline in vacancy rate is mainly due to the second highest net demand figure on record (excess of three times the historical average) with positive demand particularly concentrated in the A grade segment. Eastern Core, Docklands and Flagstaff precincts have the lowest vacancy rates at 3.1%, 3.3% and 3.7% respectively while negative demand was concentrated in the Civic and North Eastern precincts where vacancy rates both rose. 
With strong tenant demand and restricted supply, we are witnessing improving effective rents with CBD incentives beginning to shift down in certain sub markets. However, leasing incentives continue to be relatively high with 25 percent to 30 percent net incentives being offered for longer lease terms across larger tenancies. 
Due to the statutory valuation in 2016, the 2017 Land Tax Assessments have come as a shock for many CBD and city fringe landlords. A large number of 2017 land tax assessments have increased substantially compared to 2016 which could have a significant impact on value, particularly when the tenancy profile is on a gross rent basis or when tenancies are subject to the Retail Leases Act, in which case land tax is non-recoverable. 
“We have witnessed land tax for some CBD sites more than double or even triple last year’s land tax,” say HTW in their report. 
The increases in land tax have significantly impacted landlords’ projected cash flow, especially if properties are tied up with long-term gross or retail leases. The effect of this increase is only now being felt as 2017 assessments were only released in January. There are very few transactions in 2017 and in any case, buyers may be going off 2016 assessments. 
For the St Kilda Road precinct, there have been significant withdrawals of office accommodation over the past couple of years as many developers are buying existing older style office buildings with the view to converting or redeveloping them for residential purposes. This reduction in stock and displacement of tenants has given a slightly false take on the market, as tenant demand is still way off historically high levels pre-GFC.
The market has also seen a flight to quality, with A grade buildings performing better than their B grade counterparts. Owners investing in the building services and end of trip facilities are being rewarded by a reduction in the letting up periods and stronger rents. In the past 12 months, incentives peaked at 32 percent, however, are now moving back down.
Due to the Melbourne Metro rail project, traffic along St Kilda Road will be severely restricted for the coming two to three years. Discussions with local leasing agents reveal that some existing tenants are attempting to take advantage of this situation by using it as a lever for better deals on renewals, particularly around negotiating shorter lease terms.
St Kilda Road will potentially always be a strong market for smaller tenants, but for the larger tenants (1,000 square metres plus) the market may be more challenging and must remain a cost effective option to overcome the threat of the CBD, Docklands and Southbank markets. This may put a ceiling on rental growth for the foreseeable future and at least for the duration of the major tunnel works. 
On the buy side, strong demand is continuing for good quality office properties within the Melbourne CBD, Metro and St Kilda Road office markets. This is primarily due to the lack of suitable stock and sheer weight of capital seeking limited investment opportunities in this segment of the market.
Assets in the $10 million to $40 million price point are expected to continue to appeal to a broad range of private investors, syndicates and self-managed super funds. Institutional buyers typically start at circa $50 million.
The CBD office market was off for a hot start in 2017 with the record breaking sale of Bourke House, 179-183 Bourke Street, which was sold to a mainland Chinese investment corporation for $33 million in March, representing a low yield of 4.3 percent and a capital value rate of approximately $20,000 per square metre. The sale also reflects a 287 percent capital gain since its last sale of $11.53 million in 2014. 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/04/21/BourkeHouse.jpg" alt="">
Deep pocket buyers are less focused on leasing risk, WALES and capex risk because they are more focused on location and securing assets in a limited opportunity market. Leasing risk and capex risk are considered transient risks which can be mitigated. 
On the other hand, demand is very strong for strata office floors in the CBD. This is seen as a way to gain a foothold in the CBD as some buyers struggle to afford freehold CBD properties. 
“We are also witnessing some buyers are accumulating multiple floors within the same building. “
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jonathanchancellor-7SQnKwU6yx

Melbourne has second-lowest vacancy rate among Australia’s CBDs: HTW

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The office property market in April has none at the peak of market, implying the top of the commercial property clock by valuation firm Herron Todd White is empty.
But several regions/cities are approaching the peak of the market, namely Coffs Harbour (above), Gold Coast, NSW Far North Coast and Newcastle, which joined Melbourne at the position.
Apart from that, there wasn’t much movement in the rest of the property clock, according to HTW’s latest update. Sydney remains a rising market, while Perth is approaching the bottom.
While the top of market is empty, there are quite a few places at the bottom of market position, including three capital cities — Adelaide, Darwin and Hobart.  The new entrant to the list of 9 is Wide Bay.
<a href="https://www.propertyobserver.com.au/images/2017/04/21/HTWCommercialApril17.jpg" target="_blank">Click to enlarge</a>
 <img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/04/21/HTWCommercialApril17.jpg" alt="">
<a href="https://www.propertyobserver.com.au/images/2017/04/26/HTWOfficeVer2-3-2.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/04/26/HTWOfficeVer2-3-2.jpg" alt="">
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No region at peak of office market, but several approaching the top: HTW April clock 

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GUEST OBSERVER
Office occupiers and their employees have a wide variety of locations to choose from.
We examine 12 of the most important real estate markets in the region. Discover the performance and prospects for the big ‘Global Powerhouses’ like London and Paris, fast-growing ‘Urban Accelerators’ like Stockholm, Berlin and Dublin, through to small but high profile ‘Contenders’ like Amsterdam, Frankfurt and Warsaw.
KEY FINDINGS
European cities have many of the characteristics of highly successful world cities that make them very attractive to workers looking for ‘urban buzz’ and a high quality city lifestyle. Their authentic environments, varied cultural experience and high quality of living makes the European cities in this study attractive not only to employees but also to employers.
New digital industries disrupt working practices and are growing at a faster rate than conventional finance and business services. Companies are searching globally for the Human Resources they need to win in this environment. This means that companies’ location choices will increasingly be made by the HR rather than premises departments. The questions they will ask are “which cities will help attract human capital?” rather than “where will property costs help save financial capital?”
Europe does contain some of the world’s global powerhouses: the top ranking cities which continue to attract people as well as global investment. Often, they act as hubs to wider, dispersed city networks. They are unlikely to lose this status in the foreseeable future and are adapting well to the digital age. London, Paris and Madrid now employ more people in their information and communication sectors than in their financial and insurance sectors.
London and Paris are the two most global cities in Europe and accommodation costs in these cities reflect that success. Large workforces result in high demand for space in the city which pushes up rents and land values in old cities where space is limited.
There is a big fall-off in annual accommodation costs per worker to the next tier of European cities. Milan, Dublin, Amsterdam, Moscow and Brussels are around half the cost of London at present.
The cheapest cities in Europe in which to accommodate staff are Warsaw, Berlin. Frankfurt, Madrid and Stockholm. Warsaw is just over a quarter of the cost of London.
In some cities, this expense ranking is likely to change. Workspace rents are forecast to rise over the next year in Amsterdam, Dublin, Paris, Madrid, Milan and Stockholm. They are broadly stable in Brussels, Frankfurt, London and Warsaw, giving occupiers more certainty on real estate costs.
Where real estate costs are scrutinised, it is becoming as important to look at residential affordability as well as commercial property costs. Young creative workers are increasingly attracted to good, small cities offering cheaper accommodation as they are priced out of the big global financial centres. This is part of the reason why some very small European cities like Berlin, Dublin and Amsterdam are hugely successful and punching above their weight economically. Their worldwide fame belies their size.
Brexit has raised questions on London’s future as a financial centre and speculation is rife as to which European city might win London’s business. The evidence of this report suggests that no single city will take London’s crown but rather the EU passporting functions of many institutions will be dispersed throughout Europe to a variety of cities for different reasons.
Some small cities, especially those in which it is easy for multinationals to do business, those with favourable tax regimes and strong English language capabilities could do well in attracting global companies but few of these cities have the stock capacity to accommodate many large relocations from London – or elsewhere, especially in the short term. Some cities which larger levels of office supply may find their corporate and personal tax regimes discourage some companies.
Taking a combination of measures into account, London still stands out as the most attractive European city for the finance sector. We think it will continue to serve as a global finance centre but in partnership with some smaller European cities for passporting functions.
Overall, there are good reasons to expect further growth in both the economies and real estate markets of many European cities. Often the strength of the city will buck the trend of the country in which it sits so national comparisons are less useful than city comparisons.
The strength of occupier markets should continue to attract global investment in many European cities and to start attracting it in others. The attractiveness of these cities to investors is important for occupiers in the long run as it will determine whether they can find sufficient workspace of the right type in the right place and whether housing is affordable for their key workers.
The economic and demographic strength of most of the European cities in this report is such that both occupier and investor demand should be assured.
<a href="https://www.propertyobserver.com.au/images/2017/03/16/pages-4-5-figure11.png" target="_blank">Click to enlarge</a>
<a href="https://www.propertyobserver.com.au/images/2017/03/16/pages-4-5-figure11.png" target="_blank"><img src="https://www.urban.com.au/images/2017/03/16/pages-4-5-figure11.png" width="600" height="315"></a>
Source: Savills World Research
 
Yolande Barnes is director, World Research at Savills and can be contacted <a href="https://www.savills.com/" target="_blank">here</a>.
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jchancellor-FAypfDUnLy

Euro cities punching above their weight economically: Yolande Barnes

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Movements across all categories of commercial property are being keenly watched as investors look to seek traditional cash flow real estate to help fill out their portfolios, says valuation firm Herron Todd White in its March Month in Review which features the property clock as well.
The latest property clock deals with retail, which hinges on tenant success, and it’s been tough to get ahead for a number of operators in this space, say HTW.
Sydney, Melbourne and Brisbane have joined the Gold Coast, Coffs Harbour and Newcastle at approaching the peak of the market cycle in the retail property clock.
Townsville and Wide Bay remain rooted to the bottom of the cycle with Gladstone the new entrant, while Adelaide has joined Perth in approaching the bottom of the market. Canberra remains at the start of a recovery cycle, along with Cairns.
SYDNEY 
The retail market in Sydney has seen substantial growth over the past 12 months as a result of increased demand for good investment assets, growth in rental income and generally lower vacancy rates. 
The next 12 months look set to follow a similar trend, say HTW. Increased demand from investors will continue to drive the market. Properties with established retail tenants will be popular this year. 
Late in 2016 we saw some strong sales which showed tight capitalisation rates for assets with strong lease covenants, including some with sub 5% capitalisation rates in the Sydney CBD. 
The demand for CBD assets remains strong as the buzz around infrastructure improvements continues. Generally rents look likely to remain stable this year although an increase in prime locations was evident in 2016 with a strong probability of this continuing in 2017.
Recent media coverage of failing fashion retail chains may have some impact on demand from tenants but food and beverage outlets seem to be going strong in most locations, with demand for these types of retail properties likely to continue. Suburban retail assets with good lease covenants have also seen growth over the past 12 months. This is likely to continue as investors look for strong performing assets with future growth potential. 
Strip retail with a history of good retail trade such as King Street, Newtown; Darling Street, Balmain; and Crown Street, Surry Hills have all seen an increase in sales activity which looks set to continue in an upward trend in 2017. Looking ahead, the outlook for retail in Sydney overall remains positive for 2017.
"We expect prime locations to continue to perform well along with properties perceived to have growth or redevelopment opportunities in the future," say HTW.
"That said we are of the opinion that the market is reaching the peak of the cycle and any tightening of monetary policy or increase in the cost of debt will result in the prevailing investment yields not being sustainable. For the time being though, all signs are that 2017 will be a good year for retail assets."
Among a few examples of recent sales was a cafe at <a href="https://www.realcommercial.com.au/property-retail-nsw-sydney-501961950" target="_blank">1/252 Sussex St, Sydney 2000</a> which went under the hammer at Colliers International auction. 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/03/22/CafeHTW.jpg" alt="">
Another was a three-level retail building at <a href="https://www.realcommercial.com.au/property-retail-nsw-haymarket-502254638" target="_blank">82-84 Dixon Street, Haymarket, NSW 2000</a> that was sold through Knight Frank.
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/03/22/Retail2HTW.jpg" alt=""> 
Melbourne 
Melbourne’s retail property market has continued its strong run over the past 12 months with supply generally limited and yields firming and reflecting pent up demand and rising prices. The steady low interest rate environment, strong Australian dollar and the ongoing perception of being a safe haven have all combined to drive strong interest from domestic and overseas retail property buyers. 
The Melbourne CBD retail property market continues to go from strength to strength. Despite approximately 50 new shops opening in the 12 months to January 2017, the vacancy rate is stable and below the five year average. 
Rents have remained stable and range from $1,500 per square metre for CBD shopping centre space to $11,000 for Bourke Street Mall frontage while yields range from 3.5 percent to 6.5 percent for CBD shopping space and 3.5 percent to 5.5 percent for the Bourke Street Mall. 
St Collins Lane, formerly Australia on Collins, at 260 Collins Street, which completed a $30 million upgrade in 2016, sold in November 2016 for $247 million on an initial yield of approximately 5 percent and a rate of $27,444 per square metre. The revitalised site offers over 9,000 square metres of retail space over four floors. With street frontage to Collins Street and Collins Lane in the heart of the Melbourne CBD, the centre comprises 60 specialty stores, including international brands such as The Kooples, Reiss, Sandro Paris, TAG Heuer and Coach plus restaurants. 
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/03/22/CollinsSt2HTW.jpg" alt="">  
The Melbourne CBD apartment construction boom and consequential growing population have been the driving force behind the strong market. With more retailers scheduled to open their doors in the Melbourne CBD, including British retailer Debenhams’ first foray into the Australian market, and more apartment completions, 2017 is shaping up to be another strong year for the retail property market in the Melbourne CBD. 
Within the suburban shopping centre market, owners may however be affected by store closures following the recent collapse of a number of retailers including Pumpkin Patch, Herringbone, Rhodes &amp; Beckett, Marcs, David Lawrence, Payless Shoes and Howards Storage World. 
Many commentators are forecasting more retail brands, particularly clothing retailers or fast fashion competitors, to fold in the face of increased competition from overseas retailers such as Uniqlo, H&amp;M, Zara and the forthcoming arrival of giants Amazon and Alibaba as well as a gradual yet inexorable move to online retailing. 
Store closures may affect suburban shopping centres in particular as it is precisely these shopping centres that the above named global players have pushed into. Local mid-market players are effectively squeezed out both in terms of retail price of clothing and also in costs with overseas players able to negotiate lower rents than their local counterparts.
While the closure of one or two stores may not have much of an immediate impact for shopping centre landlords, over the longer term shopping centre vacancies on a larger scale may combine to push sales growth and rental growth down, subsequently impacting income levels and values of shopping malls.
<h2>
Brisbane </h2>
The outlook for retail markets in Brisbane continues to be generally positive, albeit there is now an increasing perception that yields may finally have reached a low point. To put the story of recent years into perspective, we have seen retail yields generally move by between 150 and 200 basis points, which based on a starting yield of say 8%, translates to capital growth of upwards of 25 percent over a three year period. In some instances, capital growth has been upward of 35 percent. Sales activity has been moderate for the quarter. 
Major transactions include Arana Hills Kmart at $67 million, Everton Plaza at $27.5 million and Caboolture Square at $27.5 million. These showed yields of between 6 percent and 7.25 percent. 
In neighbourhood centres we have seen the first sub 6 percent yield achieved with a shopping centre at Tewantin selling at a yield of 5.9 percent. At the convenience end of the spectrum there has been less activity with only two centres selling under $10 million. Both of these were in the North Lakes region and showed yields of between 6.5% and 7 percent. 
Overall, the volume of sales activity has generally been low, primarily as a result of a shortage of stock and lack of other strong yielding investment options. With the perception however that yields will be bottoming out, we anticipate a rise in investment sales activity, particularly if interest rates start to rise and there is any suggestion of capital values starting to fall. Retail rentals continue to be reasonably restrained with ongoing difficult trading conditions in many sectors putting the brakes on rental growth.
The weakness is evident across the board as high levels of competition, flat wages, internet retailing and changing consumer shopping patterns all contribute to a very tough retail environment. Good buying opportunities in the market are limited at present as all reasonable assets are heavily scrutinised by a wide number of investors. There is potentially some more opportunity to value add with secondary centres but even these are holding their value fairly well making owners reluctant to sell.
Below are two examples from North Lakes cited by HTW.
<a href="https://www.propertyobserver.com.au/images/2017/03/22/BrisbaneNorthLakes.png" target="_blank">Click to enlarge</a>
<img src="https://www.urban.com.au/images/2017/03/22/BrisbaneNorthLakes.png" alt="">
 
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Retail property market outlook positive: HTW

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A lack of stock and urgency by private investors to source quality investments has resulted in strong results for strata office sales in the heart of Parramatta, the epicentre of Western Sydney.
Ray White Commercial noted the demand for office strata was highlighted by the $650,000 sale at auction of a 63 sqm ground floor office investment at 3/4 Charles Street, Parramatta. It was sold by Ray White Commercial NSW-Parramatta’s Joseph Assaf for a sharp 3.62 percent yield.
Mr Assaf said smaller private investors have been particularly active in the strata office market, resulting in capital values averaging $4,520 per sqm, which is affordable in comparison to the highs achieved in the Sydney CBD of $7,614 per sqm.
“However, a lack of stock and urgency to source quality investments has resulted in results such as the sale of 3/4 Charles St,” he said.
“The yield was 3.62 per cent while the capital value was $10,317 per sqm.”
Ray White Commercial NSW Director Michael Ajaka said the robust performance of the Parramatta CBD office market over the last five years has been observed by many larger institutions and both domestic and international private investors who have been instrumental in reducing investment yields.
“Currently prime investment properties have averaged yields from 5.75 percent to 6.5 percent range,” he said.
“Recent sales include 80 George St, a B grade office building which sold for $51.88 million in October, 2016, to a private Asian investor on a yield of 8.50 percent, while A grade Century Centre at 18 Smith St changed hands in September, 2016, for $84.03 million, representing a yield of 6.88 percent.”
Ray White Commercial Head of Research, Vanessa Rader, said the Parramatta CBD office market has been yielding strong results over the last few years.
“There is still more than 200,000 sqm of office stock destined to be added in the Parramatta CBD during a time of steady employment demand which is putting pressure on vacancy rates and improving rents achieved,” she said.
“New developments in office and continued residential development coupled with changes to infrastructure means Parramatta will remain a construction zone with road closures and cranes on the skyline for the next few years.”
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j.ballantyne1990-6AQqhLzZaK

Parramatta CBD office investment yields sharpen

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Melbourne’s well-known Bourke House, a retail and office building, has recently sold for an undisclosed sum.
Located at <a href="https://www.realcommercial.com.au/property-retail-vic-melbourne-502120018" target="_blank">179-183 Bourke Street</a>, the six-level freestanding retail and office building comprises shops on the ground floor and modern upper level office accommodation. 
The building is fully leased to a range of high profile retail and office tenants with a net passing income of $1,400,000.00 pa with fixed annual increases (nearly 60% of income derived from retail tenants).
Built in 1923, Bourke House is a heritage protected building. It last exchanged hands in 2014 for more than $11.5 million, according to Fairfax Media. 
The corner property has a floor area of 2,529 sqm with triple street frontage. It is positioned in the heart of Melbourne's CBD between the city's Retail Core and Paris End.
There is redevelopment potential with highly flexible floor plates allowing for office/retail reconfigurations, subject to council approval.
The selling agents were Josh Rutman,Mark Wizel and Lewis Tong of CBRE and Raoul Salter, Michael Gross and Jonathon McCormack of Gross Waddell.
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Melbourne's Bourke House changes hands

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Office vacancies in Canberra’s Parliamentary precinct have hit a 10-year low of 1.2 percent, owing to strong leasing activity over the past six months, according to real estate firm Colliers International.
The tightening of the A-grade office market contrasts with the slight drop in Canberra CBD vacancy, largely due to the withdrawal of a number of C and D-Grade buildings.
Michael Ceacis, director of Office Leasing at Colliers, said the uptake of A-Grade office space is due to tenants seeking quality office accommodation.
“Landlords are now offering reduced incentives. Early last year 25 percent incentives were being offered and now we are seeing 15 percent or lower. Face rents in Barton are increasing and A-Grade office space is being leased for more than $440 per square metre,” said Ceacis.
“We’re finding that tenants currently occupying C and D-Grade office space in the Parliamentary precinct are looking to stay within the area but in better quality accommodation. This year we’ve already spoken to a number of tenants with a total requirement of over 10,000sq m of office space in A-Grade buildings and there isn’t enough supply to meet this demand.” 
Tenants looking to upgrade are seeking office space with a minimum of 4.5-star NABERS Energy rating with good natural light, end-of-trip facilities, good car parking ratio and close to amenities. 
The office market is expected to tighten further with no new A-Grade stock planned in the short-term. 
According to the latest PCA data, there is 3,348 sqm of A-Grade office space available for lease in the Parliamentary precinct. 
Colliers says tenants’ flight to quality and the limited supply will lead to a further tightening of A-Grade stock, driving incentives down even further and an increase in rental rates. 
According to Colliers International research, there are only a handful of buildings that could potentially be repositioned to meet A-Grade standards in the area.
Landlords willing to spend the capital expenditure needed to upgrade their buildings are securing tenants. As an example, a refurbished office building at 44 Sydney Avenue, Barton is now fully occupied.
“In the past five years we’ve seen several key sites in Barton developed into residential and hotel accommodation, such as Little National Hotel and the Governor Place precinct,” Colliers executive Aaron Bruce said.
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Vacancy in Canberra’s Parliamentary precinct hits 10-year low: Colliers

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Building services that support indoor environmental quality, lift performance and technology are among the top factors that drive the building selection decision, according to CBRE’s latest report.
However, current satisfaction levels amongst occupiers reflect the largest gaps between what is currently being offered and occupier expectations of these fundamental base building services.
As technology continues to evolve, the way we work is changing, creating the flexibility to work how, when and where we want; this can drive greater efficiency, supporting business growth as well as individual choice and work-life balance.
The war for talent continues to be a major focus for most organisations as they seek to attract and retain the best people.
Greater awareness is now being paid to the demands of staff and increasingly we expect to organisations evaluating their offerings to their people through location and building selection as well as workplace design.
There are now four generations represented in the workplace and this is resulting in a much more diverse workforce with differing needs and desires.
The CBRE Australian Millennials Survey: Myths and Realities revealed some of the demands of the Millennial generation around the workplace, with some surprising results.
Wellness and relaxation facilities ranked as the most influential amenity Millennials would desire when considering a new job.
At the same time, this factor also represented the biggest gap between desire and current provision in the workplace.
So what does this mean? A greater need for alignment in the real estate decision-making process between corporate real estate and human resources will emerge.
While corporate real estate has traditionally placed the greatest importance on cost, the core offering and base building services, there will be a greater shift towards the appreciation of the cost and value of an organisation’s people and ensuring that their demands are met.
This will drive an increasing demand for some of the softer tenant services and building differentiators such as wellness facilities and customer experience offerings such as concierge services.
According to CBRE’s Occupier Survey, the trend for workplace design is heading towards a more agile workplace format or one which endangers higher performance amongst employees.
An increasing number of occupiers planning a near-term redesign indicated they intend to implement this style of workplace format.
Occupiers who had redesigned in the past two years and adopted a more agile workplace format reported higher success ratings in achieving a number of business objectives, particularly around the areas of achieving knowledge sharing, collaboration and effective use of space.
They also gave the highest ratings in terms of their new workplace format increasing employee productivity, helping to attract and retain staff and improving the on-boarding of new and junior staff.
A high performance workplace format should be designed to enable employees to do their jobs in the most effective and efficient manner whilst also inspiring them and supporting their comfort and wellness.
Ultimately the goal of a high-performance workplace is to increase employee productivity and thus business profitability.
The next frontier in the evolution of occupier demand will be the expectation of an enhanced customer experience offering.
There is an increasing recognition that the customer relationship is now evolving beyond that of the landlord and the representative of the tenant that signs the lease.
It is now extending to include occupants of and visitors to the building.
With more diversity in the workforce, a more flexible approach to work and an increasing focus on wellness and work-life balance.
It will be imperative for landlords and building managers to ensure they are delivering an enhanced customer service experience to gain a competitive advantage in the marketplace and strengthen the landlord/occupier relationship.
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Lift performance, technology and indoor quality top factors in choosing offices: CBRE

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The office market in 2016 witnessed more divergence between the southeast markets and the resource-based states with the trend likely to continue in 2017, according to commercial real estate firm CBRE’s latest report.
Strong economic growth in New South Wales and Victoria led to increased demand in the office sector.
Queensland and Western Australia continued to lag, although Brisbane has stabilised and will be on the road to gradual recovery in 2017, while Perth is expected to bottom.
Office markets in Sydney and Melbourne performed well in 2016. Sydney CBD, in particular, outperformed with its strongest level of net effective rental growth in over 20 years.
Net effective rents (NER) grew 25 percent in the prime grade sector.
The Sydney CBD secondary grade office market set new records in 2016: vacancy fell to record lows, NERs grew 32 percent and indicative secondary rents topped $600/sqm for the first time ever.
Stock withdrawals affected the secondary market more significantly, helping deliver these results.
The prospect of limited supply over the next three years, strengthened by high withdrawal activity, in conjunction with steady growth in the services sector will continue to keep vacancy constrained.
The Melbourne CBD office market set new records in 2016 in terms of investment metrics.
Prime and secondary yields reached new lows at 5.5 percent and 6.2 percent respectively, and the spread between the two grades narrowed to a record level.
Further, albeit minor, compression is expected in H117 before yields bottom.
VIC’s strong economic growth drove white collar employment (WCE) and thus demand for office space.
Melbourne CBD achieved the highest level of positive net absorption of all states over 2016 with 117,253 sqm.
Most of this strength was captured in the last half of 2016 and resulted in vacancy declining to 6.4 percent at year end.
This helped the Melbourne CBD market achieve NER growth after four years of declines due to rising incentives.
A combination of above-average face rental growth and slight easing of incentives saw prime and secondary NERs grow 7.2 percent and 6.3 percent respectively in 2016.
"With limited supply in 2017 and demand expected to remain healthy, we forecast further NER growth in 2017 (Figure 2),” the report said.
<a href="https://www.propertyobserver.com.au/images/2017/02/16/Figure%202.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/16/Figure%202.jpg" alt="">
The QLD economy has overcome the drag of the LNG CAPEX unwind and returned to growth in 2016.
“We expect further gradual improvements in 2017,” the report stated.
The advancement towards a possible 2017 construction start for the $21.7 billion Carmichael mine project by Adani has provided some confidence to the medium-term outlook, although the project represents only a fraction of activity sparked by the three recent LNG projects.
Brisbane CBD vacancy peaked in 2016 but then tightened to 15.3 percent by year-end due to its strongest annual absorption ever recorded (94,601sqm).
The latest supply cycle has completed and 2017-18 is expected to see low levels of supply in the CBD and Near City markets.
“We forecast a gradual fall in vacancy despite the strong absorption outcome in 2016, partly due to at least two further major tenant relocations to the Near City market,” the report said.
The Perth CBD office market appears to be approaching the bottom of the cycle: vacancy has probably peaked at 22.5 percent, leasing activity has picked up, and the rate of rental decline slowed substantially over 2016, with Q416 net face and effective rents remaining static.
The market is starting to benefit from tenant migration from fringe and suburban locations as businesses take advantage of lower rents and higher incentives by upgrading accommodation in a flight-to-quality.
This has led to an increase in the number of CBD leasing transactions.
The SA economy in 2016 was bolstered by public investment and also surprising growth in private consumption and retail trade.
These impacts will pass in 2017 and economic growth will moderate. The Adelaide office market remains steady with vacancy hovering at around 16%.
“Net absorption was weak in 2016 and we don’t expect much improvement in 2017,” concluded the report.
Limited supply (in the form of refurbishments) will help the vacancy rate tick slightly lower.
The ACT recorded the highest growth in State Final Demand of all the state and territories in the year to Q316, which supported Canberra CBD white collar employment growth of 3.4 percent over the same period, more than any other CBD market in Australia.
Limited new supply has resulted in vacancy trending downward since 2015 – a trend expected to continue over the medium term, posing a favourable outlook for the Canberra market.
Although softer tenant demand is expected in major office markets in 2017, the outlook for Australia’s office sector is favourably impacted by the lowest level of net supply additions in 20 years.
National CBD vacancy will begin to trend down and we forecast it to reach 9.8 percent by year-end 2017.
CBRE Research’s near-term view of office market return expectations (annualised 3-year NER growth plus yield as at December 2016) for each market is illustrated in Figure 3.
<a href="https://www.propertyobserver.com.au/images/2017/02/16/Figure%203.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/16/Figure%203.jpg" alt="">
“This return calculation assumes static yields so paints a clear picture of our NER growth expectations.  "We forecast that the best performing markets in Australia will be: Melbourne CBD, Macquarie Park, Parramatta, Canberra CBD and Sydney CBD,” the report concluded.
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New South Wales and Victoria economic growth leads to increased office demand: CBRE

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Demand from office occupiers is evolving, as revealed in CBRE’s 2016 Australia Occupier Survey, and CBRE expects to see further evidence of this demonstrated in leasing activity in 2017, according to CBRE’s latest report.
The survey targeted 100 large commercial occupiers throughout Australia across a broad range of industries to find out which factors are driving occupiers future real estate strategies.
People, technology and the new economic order are changing our approach to work and thus the concept of how, when and were we work.
This structural shift will increasingly impact on leasing decisions when considering location, building selection, workplace format, quality of building services and amenities, and the customer experience offering.
Occupiers identified consolidation, change of workplace format and growth as the top three real estate strategies they plan to implement in the next three years in order to drive their overall business strategy.
Cost continues to outpace other considerations as the most important factor in the real estate location/building selection decision.
Cost reductions are important to occupiers and rationalising space in a way to achieve this, with a focus on reviewing requirements beyond their current lease.
<a href="https://www.propertyobserver.com.au/images/2017/02/16/Screen%20Shot%202017-02-16%20at%205.35.33%20pm.jpg" target="_blank">Click to enlarge</a>
<img src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,q_auto:good/https://s3-ap-southeast-2.amazonaws.com/po.images/2017/02/16/Screen%20Shot%202017-02-16%20at%205.35.33%20pm.jpg" alt="">
Occupiers cited as key objectives for their future real estate strategy:
. Implementing more-flexible work practices through a new workplace format
. Reducing corporate footprint
. Increasing utilisation rates
From the survey, 57 percent of occupiers expected to increase their staff headcount by 2018 but only 22 percent plan to increase their net lettable area.
This will ultimately translate into more people in less space. The average workspace ratio is predicted to decrease by 5.5 percent as a result.
<div>
As businesses look to consolidate and change their workplace formats to achieve greater space utilisation rates, an efficient floorplate will be key in supporting these goals.
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