Barometer points to improving office demand

Wanting to know what’s going to happen in the Sydney office market in the next few months?

A new barometer is tipping improving demand, with increased business confidence in the finance/insurance and property industries seen as the main drivers of improving conditions.

Dexus Property Group’s new Office Demand Barometer increased from 0% to 0.6% in the quarter ending September 30.

“(This) has opened up a clear gap over actual demand numbers,” said Dexus General Manager of Research Peter Studley.

“The Barometer is now pointing to stronger leasing conditions than it was at the beginning of the year, driven by improving business confidence and a stronger share market,” Mr Studley said.

“The October NAB Business Confidence numbers were up eight points on the beginning of the year, with above average confidence in the finance, business and property sectors.”

Mr Studley said the barometer confirmed what Dexus – the largest owner and manager of Sydney’s premium and A-grade office stock – was seeing on the ground.

“Supporting the Demand Barometer, Dexus’s managed office space experienced a mild uplift in enquiry levels during the month of October 2013,” he said.

The barometer is a new, quarterly indicator aimed at monitoring the level of tenant demand for Sydney office space.

It is based on a collection of variables, including the ANZ job advertisement series, the US ISM Manufacturing Index and the volume of short-term business travel departures.