"National Australia Bank releases commercial property index, confirming WA No.1"

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PERTH'S nation-leading commercial property market will continue to boom in the coming years, despite previously unidentified suburban office vacancies coming to light.   

National Australia Bank (NAB) today released its commercial property index, which conf
irmed WA’s No.1 position.

Nationally, the index remained in negative territory at minus 6 points, but it was a slight improvement from a previous low of minus 13 points.

NAB counts the office, retail, hotels and industrial sectors in its commercial property index.
The bank said today that conditions were currently strongest in Australia’s CBD hotels and offices, however WA led the charge for the entire commercial property sector including office, retail and industrial segments.

NAB highlighted that WA had remained the strongest state in terms of commercial property and would continue to reign supreme over the next two years.

NAB said conditions were strongest in WA but a big turnaround is expected in Queensland while South Australia remained volatile.

With regard to retail, NAB said Victoria – which was identified as the best-performing state in a very weak retail property market - will be overtaken by WA.

However WA’s position atop the industrial property sector will be lost to Queensland by the end of next year.

Meanwhile, according to the new Western Australian Suburban Office Report produced by Y Research, there were vacancies in 20 per cent of the state’s 2243 suburban office buildings.
This, Y Research suggested, meant that WA’s office space shortage may not be as severe as previously reported.

Y Research claims it provides independent research and analysis on WA’s commercial office, retail and industrial property markets.

It today identified 1.51 million square metres (sqm) of office space across 151 of Perth’s suburbs, double the highest previous industry estimate.

Subiaco was the largest suburban office market, at 151,157 sqm, followed by Northbridge, Herdsman and East Perth.

“Importantly for growing West Australian businesses, the Report shows there is 176,965 sqm of office space vacant in 524 buildings across Perth’s suburbs.,” the report stated.

“This represents a vacancy rate of 11.7 per cent, with vacancies in 1 in 5 of Western Australia’s 2,243 suburban office buildings.”

Y Research chief problem solver, Damian Stone said the report gives some hope for Perth CBD and West Perth tenants facing a looming office shortage in existing office markets.

“With less than 100,000 sqm available office supply in the Perth CBD and West Perth, tenants looking for expansion space were expected to have limited options in the coming 24 months,” he said.

“This report shows that there is existing and new suburban office space that will ease, not solve, the coming space shortage in the CBD and West Perth.

“The Perth CBD and West Perth are home to major international/national companies while the suburbs cater to a range of local companies and Government.

“As CBD options decrease, suburban office markets should boom in the coming year, similar to the last space crisis in 2007/8 where over 400,000 sq m of suburban development was proposed.”

Late last year Jones Lang LaSalle suggesting WA's capital had cracked the top five office markets worldwide.

Just prior to Christmas, property group Stockland cashed in on the booming Perth office market, selling its half stake in Perth's Exchange Plaza for $157.7 million.

This information was Gathered from:
http://www.perthnow.com.au/business/national-australia-bank-releases-commercial-property-index-confirming-wa-no1/story-e6frg2ru-1226272027202

DEB BRADY
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