Property Australia

Restarting our cities’ hearts

Karen Jamal Karen Jamal September 14, 2021

The Property Council’s latest office occupancy survey lays bare the impact of ongoing lockdowns on CBDs, with Sydney’s centre at just four per cent and Melbourne’s at seven per cent.

 

  Three key takeaways:

  • 15% of Australian jobs were generated in the CBDs of our four biggest cities prior to COVID-19, according to the Grattan Institute
  • The majority of respondents said they do not expect to see a material increase in CBD office occupancy levels within the next three months
  • “As Australia moves through the phases of recovery, we are going to need to rely on bustling and productive city centres to drive economic growth,” says Property Council chief executive Ken Morrison.

 

Cities emerging from recent lockdowns recorded strong recoveries in the number of workers returning to their offices, the Property Council survey reveals.

Brisbane and Adelaide CBDs achieved 60 per cent and 65 per cent of pre-COVID occupancy, respectively.

On the other hand, Canberra’s lockdown is the most dramatic decline in occupancy across the country. Occupancy in the nation’s capital fell from 73 per cent to just eight per cent in August.

 

Table 1: Office occupancy as a percentage of pre-COVID levels by CBD

NOTE: The data is presented as a percentage of the pre-COVID rate of office occupancy, which is estimated at 90%. If a CBD achieves the same level of occupancy as the pre-COVID norm this is presented as “100%”.

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Morrison says the numbers underscore the challenge ahead for policymakers.

“Our CBDs support millions of jobs and generate hundreds of billions of dollars in economic activity. We know that lockdowns are having a big impact on our CBDs, but it is encouraging to see that, once lockdowns are lifted, workers are returning at faster rates than we recorded in 2020.”

CBD workers “now know the drill when it comes to lockdowns,” Morrison notes, adding that a “concerted effort from policymakers” will be required to accelerate CBD recovery as Australia moves through the stages of the national COVID recovery plan.

The survey found a significant 26 per cent variance in workers at the office between weekly peak days and days in unrestricted CBDs.

 

Figure 1: Peak and low day level of occupancy in office buildings

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“The recent delta outbreaks have not impacted all cities equally and have created two distinct challenges across our city centres,” Morrison observes.

“For the capitals that have been less affected, we need to find a way of enticing workers to increase their number of days in the office.

“Once we’ve overcome the immediate threats to public health, it is critical that building owners and employers work together with all levels of government to get our CBDs firing on all cylinders once again.”

The Property Council surveyed members that own or manage CBD office buildings to understand occupancy from 25 to 31 August 2021.

Tags: CITIES