In a sign of tough conditions in the office market, underlying tenant demand for space nationally has dropped in the three months to the end of August to less than one-fifth of the quarterly average recorded over the last decade, according to BIS Shrapnel. The firm's senior project manager, Maria Lee said that while underlying tenant demand dropped from an already low 225,00 sqm int he May period to 125,000 sqm in the August quarter, there would be an improvement in the back end of the year.
The growing property and business services industries would drive a recovery, she added. "We should see net absoprtion move back into positive territory by the end of 2014, "Ms Lee said. "We expect underlying demand to pick up in the November 2014 quarter as the weak November 2013 data drops out of the calculation. Another stated "Inquiry from financial services companies was slow but the slack was being taken up by IT and media tenants.
Source: The Australian - 30 September 2014