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Demand for CBD offices space booms across Australia

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Demand for office space is springing back to life across the country as lockdown begins to feel like a distant memory.

National data from Colliers shows the need for more space has driven an increase in demand for larger sized offices following the past two years of remote and hybrid work arrangements.

While periods of lockdown saw businesses downsize their office footprint as employees worked from home, the end of Covid restrictions has seen many workers return to the office once again.

Business men working in office during pandemic

There has been a significant increase in demand for office space.

It comes alongside surging demand for inner city residential rentals as treechangers and overseas migrants move back to metropolitan areas.

The Colliers Office Demand Index showed there was an increase in the number of inquiries for office space exceeding 3,000sq m in the first half of this year compared to the first half of 2021, nationwide.

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Interest in other office size segments also increased, with a four per cent boost in inquiries for space under 1,000sq m and a 22 per cent increase for office space between 1,000-2,999sq m.

Working from home

The increase in demand follows two years of work-from-home disruption.

The total number of square metres inquired about surpassed 1,622,000 – an additional 61,000sq m from the same time last year.

The past three months alone saw 925,000sq m inquired about, which was close to breaching the quarterly record.

Colliers managing director office leasing Simon Hunt said the increase in demand was a positive sign.

More workers are returning to the office.

“We have witnessed a record amount of demand for office space in the first half of 2022,” Mr Hunt said.

“It’s promising to see businesses continuing to engage with the market across all office space sizes.”

National director office leasing, Sydney CBD, Cameron Williams said preferences had shifted among commercial tenants.

“Tenants are looking to trade up on quality and location, which is why we have seen a record half year for the Sydney market in terms of demand,” Mr Williams said.

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