Offices most transacted commerical real estate assets for 2022, according to Ray White Commercial
The value of offices in Sydney’s CBD has pushed up the figures seen at sale transactions.
Office assets have topped the list for the most transacted commercial assets over the past year, accounting for 34 per cent of all sales.
New data from Ray White Commercial has found office assets have jumped up from 27 per cent in 2021, despite the difficulties seen in regard to occupancy levels.
The low vacancy environment also saw owner occupiers seeking shelter from rising rents, with assets in the sub $2m range totalling $3.8bn.
Despite low vacancy rates as workers entered a hybrid work approach, office assets were the most transacted in 2022. Picture: NCA NewsWire / Paul Jeffers
Ray White Commercial head of research Vanessa Rader said as volumes have fallen by 30 per cent, the investor market is beginning to run out of steam as interest rates continue to grow.
“In 2022, the swing has certainly moved back to office transactions with a high number of larger institutional, REITS, and offshore buyer groups competing for major CBD holdings setting new highs in values,” Ms Rader said.
A number of offshore buyer groups and larger institutional buyers have competed for major CBD holdings.
“Many businesses have been grappling with what their future accommodation needs may be during this post-Covid economy which sees some staff working from home on a part time or full time basis.”
A number of markets saw a shift downwards during the year, with retail, development, hotel, and other asset classes accounting for under 20 per cent of commercial transactions.
A number of asset classes accounted for under 20 per cent of commercial transactions.
The ability to obtain finance resulted in buyers considering low transaction classes like retail despite the uncertainty and growing vacancies in some locations.
Interest in hotel and leisure assets rebounded off the back of strong private interest and the increased demand in travel.
Industrial assets accounted for 25 per cent of the total pool of sales.
”After a quiet 2021, the accommodation sector has grown in popularity accounting for $3.2b in sales, up from $2.3b last year.”
“The increased demand for travel this year is doing much to improve occupancy rates across the country as well as moving average daily room rates up across major tourism destinations and regional centres.”
Demand for hotel and accommodation assets spiked among high travel demand in NSW.
“The confidence of buyers in office assets highlight the long term belief in the asset class and the trophy nature of some CBD assets on the global stage.”
Industrial still remains in high demand for buyers, however the lack of stock on market has resulted in volumes falling to just $17.3b and accounting for 25.9 per cent of the total pool of sales.
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