Blog - TGC News
TGCONNECT | JUNE 2016
FINANCIAL YEAR WRAP UP AND TGC RESULTS
TAKE A LOOK AT SOME OF OUR LATEST RESULTS HERE.
The past financial year has seen tenant demand heat up considerably due to an improving labour market. We have also seen a number of older buildings being withdrawn from the market for alternative uses (such as hospitality or residential uses), redevelopment or acquisition for the new Sydney Metro project. The reduction in available commercial space for lease has had a big impact on vacancy rates, which is at a low 4.5% and creating tight competition for tenants looking to lease.
The active office market for those looking to sell or buy can be attributed to Sydney’s positioning as a gateway investment city, NSW’s improved economy and investors taking advantage of low borrowing costs. Demand for commercial investment property is strong!
CITY FRINGE UPDATE
The city fringe leasing market continues to perform strongly, with the main features being lack of quality stock. In sales, the dearth of new projects brings strong competition whenever a quality listing comes on the market. A new strata commercial project on the city fringe would be very well received.
TGC Q2 HIGHLIGHTS
We’ve had a busy 12 months and have secured some outstanding deals for our clients. Notably, Sales & Leasing Agent, William Shen, convincingly sold Suite 1308, 97-99 Bathurst Street in Q2. The 53 sqm office space sold for $614,000 with a net investment of $11,604 per sqm a record for the building!
VIEW OUR LATEST RESULTS HERE.
2016/2017 FINANCIAL YEAR OUTLOOK
We will see a generation of new investment opportunities due to the changing shape of the Sydney CBD and the creation of new urban precincts, due to Sydney’s light rail and Barangaroo developments. Secondly, we will see new types of property that will aim to meet the needs and demands of the new urban consumer. For example, we will see an increase in urban logistics directly accredited to the surge of e-commerce. We forecast that there will be even more limited stock in 2017 due to NSW businesses expanding headcount, which means there will be above-trend rental growth in the next coming year. This will all have a direct impact on leasing incentives which will ease as a result of reduced office space supply.