Slower office rental growth, but still increasing: Knight Frank's Prime Office Rental Index

Knight Frank's Asia-Pacific Prime Office Rental Index for Q3 2018 has showed slower growth, however is still on the rise.

The Q3 Index increased saw an increase of 2.3% quarter-on-quarter and 6.4% year-on-year.

The index showed slower growth, as office occupiers delayed significant real estate decisions amidst rising US-China trade tensions

Despite slower growth, 18 out of the 20 cities tracked report stable or increased rental growth.

Rental growth in Sydney and Melbourne continues to be among the strongest in the region, recording further increases during the quarter to be up 14% and 7% over the past year respectively  

Knight Frank's head of research and consulting Australia Ben Burston puts the increases down to employment growth and subdued development activity.

“Buoyant employment growth and subdued development activity continues to drive rental uplift in Sydney and Melbourne, which have recorded some of the strongest growth in the region over the past year," Burston said.

"The level of supply scheduled to deliver in 2019 simply will not redress the imbalance, and this will continue to drive rents and motivate tenants to pursue densification strategies or consider emerging fringe markets where expansion can be more easily achieved.”

Asia-Pacific Prime Office Rents

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