Office Space


Sydney continues to offer lower rental rates for prime office space than many other Asia Pacific business centres. Despite the strong appreciation of the Australian dollar in 2007, annual rental costs for Grade A office space in the Sydney CBD are about a third of those in Tokyo, and half of those in Hong Kong and Mumbai.

Sydney's office infrastructure is of the highest quality. Prime office space offers flexible layouts and large floor plates, multi-zoned air conditioning, security access, car parking, short waiting intervals for lifts and pleasant views.

An improving New South Wales economy, coupled with growing employment and an expanding finance and insurance sector, has created greater demand for office space in the Sydney CBD. Jones Lang LaSalle anticipates that the city should be comfortable in this position for the next couple of years and solid investor conditions will see a stronger supply pipeline.


Rental and Capital Values of Office Space (1) - Asia Pacific Cities, 2007 (A$ per sq. metre)

City Annual gross
face rent (2)    
Capital
value (3)
Tokyo - Central Five Wards 2,187 78,125
Hong Kong - Core Central 1,110 24,682
Singapore 1,236 28,633
Mumbai - CBD 1,467 9,786
Taipei 294 7.365
Beijing - CBD 400 5,716
 
Sydney:
CBD 609 8,904
North Sydney 528 6,490
Crows Nest/St Leonards 485 4,706
Chatswood 478 3,957
Parramatta 399 4,311
North Ryde 362 4,059


Footnotes:

1: Grade A properties.
2: Annual total indicative rent paid over the initial lease term including outgoings and government taxes, i.e. total occupancy costs.
3: Capital value is based on the indicative gross face rent and indicative initial yield.

Source: CB Richard Ellis Global Research and Consulting, September Quarter 2007.