Quarter Time National Office Q3/2018

Transcription

1 Savills Research Australia Quarter Time National Office CBD Averages A Grade National Office N.F. Rent N.E. Rent Market Yield IRR Cap. Value Sydney CBD 1,065 (8.7%) 845 (7.6%) 4.75 (-40bps) 6.65 (-25bps) 20,300 (6.8%) Melbourne CBD 580 (6.4%) 430 (8.9%) 5.20 (-20bps) 6.75 (-15bps) 10,000 (5.3%) Brisbane CBD 540 (-) 290 (-) 6.00 (-65bps) 7.00 (-100bps) 9,800 (8.9%) Perth CBD 565 (-) 290 (-1.7%) 7.00 (-50bps) 7.50 (-50bps) 8,000 (1.3%) Adelaide CBD 370 (-) 210 (-19.2%) 7.25 (-25bps) 8.25 (-) 5,000 (-) Canberra Civic 370 (-) 290 (-) 6.25 (-15bps) 7.90 (-25bps) 7,300 (7.4%) Note: 12 month change shown in brackets Trends Detailed Sales Activity: $16.223bn 183 Sales ($10m+) Leasing Activity 989,222 sq m 261 Leases (1,000sq m+) Employment 12.52m 2.5% growth savills.com.au/research

2 Report Contents National Indicator Summary 3 Office Economic Drivers 5 National Sales Activity 6 National Leasing Activity 7 State Indicators and Major Activity New South Wales 8 Victoria 11 Queensland 14 Western Australia 17 South Australia 20 Australian Capital Territory 23 Client Data & Information Portal 25 Key State Contacts 26 National Head Capital Strategy & Research Chris Freeman cfreeman@savills.com.au Associate Director Capital Strategy & Research Shrabastee Mallik smallik@savills.com.au For our latest national reports, visit savills.com.au/research To join Savills Research mailing list, please research@savills.com.au National CBD Average Yield and IRR vs 10yr Bond Rate Source: RBA, Savills Research National CBD A Grade - Average Yield Spread over 10yr Bond Rate and IRR Multiple Source: RBA, Savills Research savills.com.au/research 2

3 Fringe Market Averages A Grade National Office N.F. Rent N.E. Rent Market Yield IRR Cap. Value North Sydney 840 (7.0%) 650 (14.0%) 5.25 (-50bps) 6.80 (-45bps) 15,300 (27.5%) Macquarie Park 370 (2.8%) 270 (5.9%) 5.75 (-50bps) 7.00 (-40bps) 7,000 (16.7%) Parramatta 545 (18.5%) 450 (21.6%) 5.50 (-65bps) 6.90 (-35bps) 10,300 (37.3%) St Kilda 435 (11.5%) 355 (16.4%) 5.90 (-35bps) 6.90 (-35bps) 6,800 (15.3%) Brisbane Fringe 445 (-) 230 (-4.2%) 6.25 (-65bps) 7.65 (-50bps) 8,500 (1.2%) Sunshine Coast 330 (-) 260 (-) 7.65 (-100bps) 9.75 (-) 4,000 (-7.0%) Gold Coast 350 (7.7%) 245 (4.3%) 8.15 (-35bps) 9.50 (-) 4,800 (11.6%) West Perth 325 (-) 180 (-5.3%) 7.50 (-50bps) 8.00 (-40bps) 4,100 (-) Adelaide Fringe 345 (-) 260 (-) 7.50 (-25bps) 8.65 (-) 4,400 (-) Canberra Non-Civic 335 (-8.2%) 250 (-16.7%) 7.00 (-) 8.40 (-10bps) 6,300 (-) Note: 12 month change shown in brackets National Face Rents, Effective Rents and Incentive Comparison A Grade Average 12 Month Net Effective Rental & Capital Growth A Grade Average savills.com.au/research 3

4 Yield and IRR Spread to Bond Rates A Grade Average Typical Capital Value Range ($/sq m) A Grade Average Capital Value CAGRs by Period A Grade Average (Historic) Effective Rental CAGRs by Period A Grade Average (Historic) 20% 1yr 3yr CAGR 5yr CAGR 10yr CAGR 25% 1yr 3yr CAGR 5yr CAGR 10yr CAGR 20% 15% 15% 10% 10% 5% 0% 5% -5% -10% 0% -15% -20% -5% Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic -25% Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Civic Note: CAGR = Compound Annual Growth Rate savills.com.au/research 4

5 Office Sector Economic Drivers Net Absorption vs. Growth in Prof. Job Advertisements Annual Growth in Professional Job Advertisements - % (to Aug-18) 500, ,000 Sydney CBD Melbourne CBD Brisbane CBD Perth CBD Adelaide CBD Canberra Prof. Job Ads 30% 20% WA VIC 11.0% 16.0% 300, , ,000 10% 0% (10%) NT AUS 10.0% 8.2% - (20%) QLD 8.0% (100,000) (30%) TAS 6.4% (200,000) (300,000) (40%) (50%) NSW ACT 5.8% 5.8% Note: Net Absorption to Dec-17, Job Adverts to Aug-18 SA 1.7% Annual Growth in Employment 500,000 F/T Employed P/T Employed 400, , , ,000 - (100,000) (200,000) Annual Growth in Employment by State - % (to Aug-18) NSW NT 3.0% VIC 2.5% AUS 2.5% QLD 2.3% SA 1.8% TAS 1.1% WA 1.0% 3.6% ACT 0.9% Note: CAGR = Compound Annual Growth Rate Summary of State Economic Indicators Key State Indicators (%) Latest NSW VIC QLD WA SA ACT AUS SFD / GDP Growth Jun (3.0) 3.7 (1.8) 1.3 (1.8) 4.0 (2.0) 4.4 (2.6) 5.0 (3.0) 2.9 (2.6) Population Growth Mar (2.1) 1.7 (1.8) 0.8 (1.9) 0.7 (0.9) 2.1 (1.9) 2.2 (2.1) 1.6 (1.6) Employment Growth Aug (2.2) 2.3 (1.3) 1.0 (1.4) 1.8 (0.7) 0.9 (1.3) 2.5 (2.2) 2.5 (1.6) Unemployment Rate Aug (5.7) 6.1 (5.8) 6.1 (5.1) 5.8 (6.1) 3.8 (3.9) 5.3 (5.7) 5.4 (5.5) CPI (Inflation) Jun (2.2) 1.7 (2.2) 1.1 (1.8) 2.7 (2.1) 2.8 (2.0) 2.5 (2.2) 2.1 (2.1) Job Adverts (Total) Aug (-3.4) 8.0 (-7.4) 16.0 (-6.4) 1.7 (-7.3) 5.8 (1.3) 11.0 (-3.4) 8.2 (-4.7) Job Adverts (Prof) Aug (-2.2) 11.3 (-6.3) 18.0 (-6.9) 15.2 (-4.9) 6.5 (1.9) 12.7 (-2.2) 11.6 (-4.1) Source: ABS / DOE / Savills Note: Annual change shown, 10yr compound average in brackets; Note: Economic growth numbers are on a rolling annual basis; Employment growth is on trend terms savills.com.au/research 5

6 National Sales Activity Reported Transaction Activity Sales $10m+ $20bn NSW VIC QLD WA SA ACT $18bn $16bn $14bn $12bn $10bn $8bn $6bn $4bn $2bn $0bn 100% 80% 60% 40% 20% 0% Purchasers Fund Developer Government Foreign Investor Other Vendors Trust Owner Occupier Syndicate Private Investor Top Recent 15 Sales by Value ($m) Ann St, Brisbane, QLD (50.0%) - Jul-18 - $11,353/sq m 60 Station St, Parramatta, NSW - Aug-18 - $10,818/sq m 1 Sussex St, Sydney, NSW - Jul $25,000/sq m 275 George St, Sydney, NSW - Aug-18 - $32,877/sq m 2 King St, Fortitude Valley, QLD - Sep-18 - $10,403/sq m 60 Collins St, Melbourne, VIC - Sep-18 - $11,580/sq m Franklin St, Adelaide, SA (50.0%) - Aug-18 - $7,236/sq m 383 La Trobe St, Melbourne, VIC - Sep-18 - $11,961/sq m 343 Albert St / 143 Turbot St, Brisbane, QLD - Jul Flinders St, Adelaide, SA - Aug-18 - $6,443/sq m 260 Queen St, Brisbane, QLD - Aug-18 - $7,364/sq m 277 William St, Melbourne, VIC - Jul-18 - $7,772/sq m 40 Tank St, Brisbane, QLD - Aug-18 - $14,957/sq m 60 Pitt St, Sydney, NSW - Aug $19,886/sq m 80 Mount St, North Sydney, NSW - Sep-18 - $11,444/sq m 52 Collins St, Melbourne, VIC - Sep-18 - $20,266/sq m 80 Dixon St, Sydney, NSW - Aug-18 - $24,498/sq m 105 York St, South Melbourne, VIC - Sep-18 - $9,598/sq m 60 Queen St, Brisbane, QLD - Sep-18 - $13,041/sq m Ryrie St, Geelong, VIC - Jul-18 - $4,819/sq m Top Recent 15 Sales by $/sq m 32,877 25,000 24,498 20,266 19,886 14,957 14,789 13,041 12,036 11,961 11,580 11,444 11,353 10,818 10,403 9,598 9,563 8,295 7,918 7, George St, Sydney, NSW - Aug-18 - $240.00m 1 Sussex St, Sydney, NSW - Jul $250.00m 80 Dixon St, Sydney, NSW - Aug $61.00m 52 Collins St, Melbourne, VIC - Sep-18 - $70.00m 60 Pitt St, Sydney, NSW - Aug-18 - $82.17m 40 Tank St, Brisbane, QLD - Aug $93.00m 362 Little Collins St, Melbourne, VIC - Sep-18 - $14.05m 60 Queen St, Brisbane, QLD - Sep-18 - $41.00m 2 Millennium Blvd, Carindale, QLD - Sep-18 - $28.20m 383 La Trobe St, Melbourne, VIC - Sep-18 - $122.00m 60 Collins St, Melbourne, VIC - Sep-18 - $160.00m 80 Mount St, North Sydney, NSW - Sep-18 - $71.00m 80 Ann St, Brisbane, QLD (50.0%) - Jul-18 - $418.00m 60 Station St, Parramatta, NSW - Aug-18 - $277.60m 2 King St, Fortitude Valley, QLD - Sep-18 - $170.00m 105 York St, South Melbourne, VIC - Sep-18 - $49.00m 217 George St, Brisbane, QLD - Sep-18 - $30.36m 107 Overton Rd, Williams Landing, VIC - Jul-18 - $25.93m 115 Batman St, West Melbourne, VIC - Sep William St, Melbourne, VIC - Jul-18 - $93.88m savills.com.au/research 6

7 National Leasing Activity Reported Leasing Activity by CBD Leases 1,000sq m+ 1,600,000 Sydney - CBD Melbourne - CBD Brisbane - CBD Perth - CBD 1,400,000 Adelaide - CBD Canberra 1,200,000 1,000, , , , ,000 Retail & W'Sale 55,112sqm - 5.7% IT & Comm 88,816sqm - 9.2% Mining & Util. 118,108sqm % Business Serv. 209,260sqm % Govt. 210,704sqm % Fin & Ins 258,979sqm % Leasing Composition by Type Leases 1,000sq m+ Leasing Composition by Grade Leases 1,000sq m+ Direct - 583,534sqm % Precommit - 338,725sqm % Renewal - 53,910sqm - 5.5% Sublease - 9,148sqm - 0.9% Assignment - sqm - 0.0% Premium - 159,725sqm % Grade A - 521,847sqm % Grade B - 144,213sqm % Grade C - 10,429sqm - 1.2% Grade D - 7,440sqm - 0.9% Top 20 Recent Leases 1,000sq m+ 39,600 Precom Direct & Other 13,200 9,720 9,600 9,527 9,500 9,198 8,664 7,800 7,099 6,750 6,625 6,414 5,405 5,250 4,304 4,200 3,600 3,500 3,126 Suncorp, QLD WorkSafe Victoria, VIC AMP, VIC CBus Super, VIC HDY/NRF, NSW JB Hi-Fi Group, VIC Wood Group, WA Deutsche Bank, NSW Reece Group, VIC Downer EDI, QLD Aesop, VIC DXC Technologies, QLD Department of Veterans Affairs, QLD Newcrest Mining, VIC WeWork, VIC Fair Work Ombudsman, VIC Regus, NSW Telstra Super, VIC Built, NSW State Government of Victoria, Minister of Finance, VIC savills.com.au/research 7

8 New South Wales PCA OMR Statistics (Jun-18) Sydney CBD North Sydney Parramatta Macquarie Park AUS CBD Total Stock 5,036, , , ,034 17,907,541 Total Vacancy 232,151 50,993 22,872 47,334 1,539,867 Vacancy (%) 4.6 (7.3) 6.3 (8.7) 3.2 (7.3) 5.4 (8.9) 9.2 (9.2) Net Absorption (12m) 9,489 (27,754) -10,325 (2,851) 20,442 (9,736) 21,379 (19,635) 149,309 (170,353) Net Absorption (%) 0.2 (0.6) -1.3 (0.4) 3.0 (1.5) 2.7 (2.8) 0.9 (1.1) Stock Additions 82,627 2,148 26,136 8, ,072 Stock Withdrawals 144,817 14,214 12,849 13, ,875 Net Additions -62,190 (30,823) -12,066 (1,094) 13,287 (7,299) -4,659 (18,385) -91,750 (282,957) Net Additions (%) -1.2 (0.6) -1.5 (0.1) 1.9 (1.1) -0.5 (2.4) -0.5 (1.7) Source: PCA / Savills Research Note: 10yr Average shown in brackets Sydney CBD Key Indicators Sydney CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) 1,265 1,665 1,160 1,330 1,000 1,150 Rental Net Face ($/sq m) 1,050 1, , ,000 Incentive Level Gross Rental Net Effective ($/sq m) 800 1, Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) 990 1, , Office Capital Values ($/sq m) 22,500 30,000 18,500 22,000 13,500 20,000 savills.com.au/research 8

9 North Shore Key Indicators North Shore North Sydney A Grade North Sydney B Grade Macquarie Park A Grade Low High Low High Low High Rental Gross Face ($/sq m) 915 1, Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 13,000 17,500 11,000 12,500 6,500 7,500 Parramatta Key Indicators Parramatta A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 9,500 11,000 7,000 9,000 savills.com.au/research 9

10 Top Recent Notable Sales Property Price ($m) Date NLA (sq m) Yield Type $/sq m 275 Kent St, Sydney (50%) Jun-18 77, i 22,193 2 Market St, Sydney (50%) Mar-18 40,178 n.a n.a 14, Miller St (Northpoint Tower), North Sydney (50%) Jun-18 35, r 17, Station St, Parramatta Aug-18 25, r 10, Elizabeth St, Sydney May-18 16, e 16, Clarence St, Sydney Apr-18 14, r 17,043 1 Sussex St, Sydney Jul-18 10,000 n.a n.a 25, George St, Sydney Aug-18 7, r 32, Goulburn St, Sydney (50%) Mar-18 23, e 15, Clarence St, Sydney Jun-18 12, e 12, Thomas St, Haymarket Apr-18 23, i 6, Pacific Hwy, North Sydney May-18 9,392 n.a n.a 11,962 Piers 8/9 23 Hickson Rd, Sydney Jun-18 8, e 10, Pitt St, Sydney Aug-18 4,132 n.a n.a 19, Mount St, North Sydney Sep-18 6, i 11,444 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * Includes >$30 m in compensation beyond market value. Top Recent Notable Leases Property Tenant Date NLA (sq m) Type Rent Term 72 Christie St, St Leonards Mastercard May-18 12,000 Direct n.a Carrington St, Sydney Allianz Jul-18 10,820 Precommit n.a 10 1 Sussex St, Sydney WeWork Jul-18 10,000 Precommit n.a n.a. 60 Martin Pl, Sydney HDY/NRF Aug-18 9,527 Precommit 1,250 (G) Phillip St, Sydney Deutsche Bank Sep-18 8,664 Renewal n.a 8 60 Union St, Pyrmont The Star Entertainment Group Dec-17 6,617 Direct 864 (G) Miller St, North Sydney Flight Centre Mar-18 6,600 Direct 830 (G) 8 50 Miller St, North Sydney US Consulate General Sydney May-18 6,000 Direct n.a 12 1 Denison St, North Sydney SAP Jun-18 5,706 Precommit 750 (N) Miller St, North Sydney Allianz Australia Services Feb-18 5,654 Direct 746 (N) George St, Sydney WeWork Mar-18 5,211 Direct 965 (N) Clarence St, Sydney Built Sep-18 3,500 Precommit 1,115 (G) n.a. 220 George St, Sydney Poly Group Sep-18 2,500 Precommit 1,450 (G) 8 60 Martin Pl, Sydney Banco Chambers Aug-18 2,500 Precommit 1,400 (G) Pitt St, Sydney hipages Group Sep-17 3,788 Direct 913 (G) 6 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 10

11 Victoria PCA OMR Statistics (Jun-18) Melbourne CBD St Kilda Rd Southbank East Melbourne AUS CBD Total Stock 4,541, , , ,461 17,907,541 Total Vacancy 162,652 48,723 25,890 5,463 1,539,867 Vacancy (%) 3.6 (6.6) 7.4 (10.6) 6.1 (6.9) 3.1 (2.9) 9.2 (9.2) Net Absorption (12m) 122,144 (72,407) 13,869 (-9,958) 4,687 (2,896) 400 (-109) 149,309 (170,353) Net Absorption (%) 2.9 (1.8) 2.3 (-1.5) 1.2 (0.8) 0.2 (-0.1) 0.9 (1.1) Stock Additions 81,755 9,346 42, ,072 Stock Withdrawals 64,498 21,979 25, ,875 Net Additions 17,257 (77,351) -12,633 (-10,135) 17,188 (4,675) (-82) -91,750 (282,957) Net Additions (%) 0.4 (1.9) -1.9 (-1.4) 4.2 (1.2) 0.0 (0.0) -0.5 (1.7) Source: PCA / Savills Research Note: 10yr Average shown in brackets Melbourne CBD Key Indicators Melbourne CBD (City Core) Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) 750 1, Rental Net Face ($/sq m) Incentive Level (Net) Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 10,000 15,000 8,000 12,000 7,000 10,000 savills.com.au/research 11

12 Melbourne St Kilda Rd Key Indicators Melbourne St Kilda Rd A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level (Net) Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 5,500 8,000 5,000 6,000 Melbourne Suburban Key Indicators Melbourne Suburban A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level (Net) Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 6,100 7,600 4,500 5,500 savills.com.au/research 12

13 Top Recent Notable Sales Property Price ($m) Date NLA (sq m) Yield Type $/sq m 697 Collins St (Two Melbourne Quarter), Docklands Mar-18 46,349 n.a n.a 11, Collins St, Melbourne Sep-18 13,817 n.a n.a 11, La Trobe St, Melbourne Sep-18 10, i 11, Flinders St (World Trade Centre), Docklands Feb-18 23, r 5, Bourke St, Docklands (50.0%) Apr-18 18,644 n.a n.a 10, Harbour Esplanade, Docklands Jun-18 7, r 12,531 Cnr Sturt St & Southbank Blvd, Southbank Feb-18 11,679 n.a n.a 8, St Kilda Rd, Melbourne Apr-18 13, r 6, William St, Melbourne Jul-18 12, i 7, Bourke St, Melbourne May-18 8, r 8, Collins St, Melbourne Sep-18 3,454 n.a n.a 20, Queens Rd, Melbourne Jun-18 9, r 6, Church St, Cremorne Jun-18 5,667 n.a n.a 8, York St, South Melbourne Sep-18 5, r 9,598 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development Top Recent Notable Leases Property Tenant Date NLA (sq m) Type Rent Term 697 Collins St, Docklands Energy Australia Mar-18 22,000 Precommit n.a n.a. 1 Malop St, Geelong WorkSafe Victoria Sep-18 13,200 Direct 480 (N) Collins St, Docklands AMP Sep-18 9,720 Precommit n.a n.a. 130 Lonsdale St, Melbourne CBus Super Sep-18 9,600 Precommit n.a Southgate Ave, Southbank JB Hi-Fi Group Sep-18 9,500 Direct n.a n.a Harcourt Pde, Cremorne MYOB Mar-18 8,800 Precommit 500 (N) Balmain St, Cremorne Reece Group Sep-18 7,800 Precommit n.a n.a. 658 Church St, Cremorne Starbucks, 7-Eleven & Withers Group Jul-18 7,400 Direct n.a n.a Northumberland St, Collingwood Aesop Sep-18 6,750 Precommit n.a n.a. 2 Southbank Blvd, Southbank Carlton & United Breweries Feb-18 6,500 Direct 800 (G) Collins St, Melbourne Treasury Wine Estates Jul-18 6,000 Direct n.a n.a. 600 St Kilda Rd, Melbourne Newcrest Mining Jul-18 5,405 Renewal 355 (N) Exhibition St, Melbourne WeWork Aug-18 5,250 Direct 520 (N) La Trobe St, Melbourne Fair Work Ombudsman Jul-18 4,304 Renewal 460 (G) Glenferrie Rd, Hawthorn United Petroleum Mar-18 3,800 Direct n.a n.a. Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 13

14 Queensland PCA OMR Statistics (Jun-18) Brisbane CBD Brisbane Fringe Gold Coast Sunshine Coast AUS CBD Total Stock 2,243,323 1,188, , ,383 17,907,541 Total Vacancy 328, ,436 56,520 25,686 1,539,867 Vacancy (%) 14.6 (12.3) 14.5 (11.5) 12.0 (17.5) 15.0 (12.5) 9.2 (9.2) Net Absorption (12m) -6,124 (13,231) -30,197 (14,623) -2,623 (5,075) 7,139 (4,654) 149,309 (170,353) Net Absorption (%) -0.3 (0.7) -2.9 (1.6) -0.6 (1.3) 5.2 (3.9) 0.9 (1.1) Stock Additions 18,303 24,815 3,713 22, ,072 Stock Withdrawals 54,705 55,891 2, ,875 Net Additions -36,402 (43,783) -31,076 (29,049) 913 (7,554) 22,542 (6,486) -91,750 (282,957) Net Additions (%) -1.6 (2.2) -2.5 (2.8) 0.2 (1.8) 15.1 (4.9) -0.5 (1.7) Source: PCA / Savills Research Note: 10yr Average shown in brackets Brisbane Key Indicators Brisbane CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 11,500 14,000 8,000 11,500 5,500 7,750 savills.com.au/research 14

15 Brisbane Fringe Key Indicators Brisbane Fringe A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) na na Office Capital Values ($/sq m) 6,000 11,000 3,500 7,000 Gold Coast/Sunshine Coast Key Indicators Gold Coast/Sunshine Coast Gold Coast Sunshine Coast Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Gross Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) na na Office Capital Values ($/sq m) 3,500 6,000 3,000 5,000 savills.com.au/research 15

16 Top Recent Notable Sales Property Price ($m) Date NLA (sq m) Yield Type $/sq m 80 Ann St, Brisbane (50%) Jul-18 73, i 11, Turbot St, Brisbane Dec-17 34, e 10, Albert St, Brisbane Jun-18 19, e 13,237 2 King St (Kingsgate), Fortitude Valley Sep-18 16, e 10, Creek St, Brisbane May-18 18, e 7, Albert St / 143 Turbot St, Brisbane Jul-18 19, e 5, Wickham St, Fortitude Valley Dec-17 11, i 8, Queen St, Brisbane Aug-18 12, e 7, Tank St, Brisbane Aug-18 6, e 14, Grey St, South Brisbane Oct-17 12, e 7, Musk Ave, Kelvin Grove Mar-18 14, e 5, Duncan St, Fortitude Valley Nov-17 4, i 15, Edward St, Brisbane Jul-18 7, i 8, Queen St, Brisbane Oct-17 3, i 15,288 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * Allocated Cap Rate from RCA; **Net; ***8.24% - fully leased net Top Recent Notable Leases Property Tenant Date NLA (sq m) Type Rent Term 80 Ann St, Brisbane Suncorp Jul-18 39,600 Precommit 850 (G) Ann St, Brisbane Allianz May-18 7,994 Direct 685 (G) Coronation Drv, Milton Downer EDI Aug-18 7,099 Direct 588 (G) Ann St, Brisbane State Government May-18 6,862 Direct 645 (G) Eagle St, Brisbane Westpac Jun-18 6,643 Direct 775 (G) Brookes St, Fortitude Valley DXC Technologies Aug-18 6,625 Direct 600 (G) Queen St, Brisbane Department of Veterans Affairs Jul-18 6,414 Direct 825 (G) Turbot St, Brisbane Bupa Jul-18 6,336 Renewal 659 (G) Adelaide St, Brisbane Hub Australia Apr-18 3,538 Direct 575 (G) Brookes St, Fortitude Valley Aurizon Apr-18 3,491 Direct 600 (G) Ann St, Brisbane AMP Mar-18 3,344 Direct 695 (G) Ann St, Brisbane Senex Energy Jul-18 3,000 Direct 696 (G) St Pauls Tce, Fortitude Valley SunWater Jul-18 3,000 Direct 570 (G) Gloucester St, Spring Hill Charlton Brown Mar-18 2,481 Direct 350 (N) 5 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 16

17 Western Australia PCA OMR Statistics (Jun-18) Perth CBD West Perth AUS CBD Total Stock 1,769, ,920 17,907,541 Total Vacancy 342,346 67,149 1,539,867 Vacancy (%) 19.4 (12.1) 15.8 (9.2) 9.2 (9.2) Net Absorption (12m) 30,759 (14,196) -3,559 (-1,459) 149,309 (170,353) Net Absorption (%) 2.2 (1.1) -1.0 (-0.4) 0.9 (1.1) Stock Additions 1,408 4, ,072 Stock Withdrawals 1,300 4, ,875 Net Additions 108 (48,056) -141 (5,256) -91,750 (282,957) Net Additions (%) 0.0 (3.2) 0.0 (1.3) -0.5 (1.7) Source: PCA / Savills Research Note: 10yr Average shown in brackets Perth CBD Key Indicators Perth CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 8,500 12,500 7,000 9,000 4,750 6,500 savills.com.au/research 17

18 West Perth Key Indicators West Perth A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 2,950 5,300 2,400 3,300 savills.com.au/research 18

19 Top Recent Notable Sales Property Price ($m) Date NLA (sq m) Yield Type $/sq m 141 St Georges Tce, Perth Oct-17 32, e 6, Pier St, Perth Jun-18 15, e 8, Wellington St, West Perth Jun-18 11, e 7, St Georges Tce, Perth Nov-17 10, e 5, St Georges Tce, Perth Feb-18 8,329 n.a n.a 5, Bennett St, Perth Jan-18 10, e 4,260 1 Havelock St, West Perth Sep-18 5, e 6, Murray St, Perth Apr-18 5, e 3, St Georges Tce, Perth Feb-18 5, e 3,897 1 Essex St, Fremantle Jul-18 3,872 n.a n.a 3, St Georges Tce, Perth Nov-17 3, e 2, Bowman St, South Perth 9.90 Nov-17 1,387 n.a n.a 7, Colin St, West Perth 8.50 Jun-18 2,746 n.a n.a 3, Murray St, Perth 8.10 May-18 6,325 n.a n.a 1, Pinjarra Rd, Pinjarra 6.80 Jan-18 1, r 4,050 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * part of a portfolio sale Top Recent Notable Leases Property Tenant Date NLA (sq m) Type Rent Term 240 St Georges Tce, Perth Wood Group Aug-18 9,198 Direct n.a n.a. 226 Adelaide Tce, Perth Dept of Human Services Aug-18 4,542 Direct n.a St Georges Tce, Perth CBH Group Apr-18 3,790 Direct n.a n.a. 77 St Georges Tce, Perth Minter Ellison Jun-18 3,440 Renewal Wellington St, Perth P&N Bank May-18 3,249 Direct n.a St Georges Tce, Perth Iluka Resources May-18 3,238 Direct n.a n.a Hay St, West Perth MSP Engineering Sep-18 2,568 Renewal n.a n.a. 556 Wellington St, Perth BG & E May-18 2,444 Direct n.a William St, Perth Virtual Gaming Worlds Feb-18 2,129 Direct n.a Adelaide Tce, Perth Minnovo Feb-18 2,033 Direct 300 (Net Stirling St, Perth Fortix Mar-18 1,983 Direct 275 (Net) 5 2 Kings Park Rd, West Perth Western Areas Mar-18 1,440 Renewal n.a 4 18 Mount St, Perth WorleyParsons May-18 1,394 Direct n.a n.a. 141 St Georges Tce, Perth Hartleys Aug-18 1,379 Renewal n.a St Georges Tce, Perth Liberty Apr-18 1,200 Direct n.a n.a. Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 19

20 South Australia PCA OMR Statistics (Jun-18) Adelaide CBD Adelaide Fringe AUS CBD Total Stock 1,424, ,212 17,907,541 Total Vacancy 210,004 23,934 1,539,867 Vacancy (%) 14.7 (11.1) 11.0 (7.8) 9.2 (9.2) Net Absorption (12m) 19,811 (5,370) -783 (184) 149,309 (170,353) Net Absorption (%) 1.7 (0.5) -0.4 (0.1) 0.9 (1.1) Stock Additions 3,505 2, ,072 Stock Withdrawals 3, ,875 Net Additions 20 (21,627) 1,362 (2,108) -91,750 (282,957) Net Additions (%) 0.0 (1.7) 0.6 (1.0) -0.5 (1.7) Source: PCA / Savills Research Note: 10yr Average shown in brackets Adelaide CBD Key Indicators Adelaide CBD Premium A Grade B Grade Low High Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level (Gross) Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 5,250 7,750 4,125 5,850 2,500 4,000 savills.com.au/research 20

21 Adelaide Fringe Key Indicators Adelaide Fringe A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Cars Permanent ($/pcm) Office Capital Values ($/sq m) 4,125 4,725 3,000 3,750 savills.com.au/research 21

22 Top Recent Notable Sales Property Price ($m) Date NLA (sq m) Yield Type $/sq m 11 Waymouth St, Adelaide Dec-17 30, e 6, Grenfell St, Adelaide May-18 22, e 8, Franklin St, Adelaide (50.0%) Aug-18 37, r 7, Flinders St, Adelaide Aug-18 15, i 6, O G Road, Felixstow Mar-18 6, e 5, Light Sq, Adelaide May-18 6, e 5, Currie St, Adelaide Jun-18 14, r 1, Conyngham St, Glenside Jul-18 3,200 n.a n.a 5, Chapel St, Norwood Feb n.a VP 39, Pirie St, Adelaide Jul-18 4,252 n.a n.a 3, Fullarton Rd, Kent Town Jul-18 2,563 n.a n.a 4, Gawler St, Salisbury 9.50 Oct-17 2, r 4, Dequetteville Tce, Kent Town 6.00 Oct-17 2,207 n.a VP 2,719 98A-100 Woodville Rd, Woodville 5.10 Jun-18 9,600 (site) n.a dev n.a. Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * part of a portfolio sale Top Recent Notable Leases Property Tenant Date NLA (sq m) Type Rent Term 141 King William St, Adelaide BHP Apr-18 10,056 Precommit n.a 10 1 King William St, Adelaide Suncorp May-18 4,660 Direct n.a Sherriff St, Underdale Downer EDI Works Apr-18 3,103 Renewal n.a Gouger St, Adelaide Thomson Geer Lawyers Nov-17 3,000 Renewal n.a Pirie St, Adelaide Cowell Clarke Jun-18 2,260 Direct n.a n.a. 25 Grenfell St, Adelaide Heathgate Resources Mar-18 1,700 Renewal n.a n.a. 118 Franklin St, Adelaide Datacom Mar-18 1,531 Direct n.a Waymouth St, Adelaide Undisclosed Sep-18 1,452 Direct n.a n.a Greenhill Rd, Parkside Metricon Sep-18 1,400 Direct n.a n.a. 1 James Schofield Dr, Adelaide Airport Oz Minerals Oct-17 1,200 Direct n.a King William St, Adelaide Attorney-General's Department of SA Jan-18 1,118 Direct 550 (G) Flinders St, Adelaide Inabox Group Jan-18 1,072 Direct 532 (G) 7 44 Pirie St, Adelaide Game Plus Dec-17 1,067 Direct 295 (G) Frome St, Adelaide AllScripts Mar-18 1,000 Direct n.a 7 Leasing Types: p = Pre-commitment, d = Direct, s = Sub-Lease, r = Renewal savills.com.au/research 22

23 Australian Capital Territory PCA OMR Statistics (Jun-18) Canberra AUS CBD Total Stock 2,321,402 17,907,541 Total Vacancy 289,221 1,539,867 Vacancy (%) 12.5 (12.1) 9.2 (9.2) Net Absorption (12m) -29,107 (21,124) 149,309 (170,353) Net Absorption (%) -1.4 (1.1) 0.9 (1.1) Stock Additions 66, ,072 Stock Withdrawals 77, ,875 Net Additions -11,162 (38,204) -91,750 (282,957) Net Additions (%) -0.5 (1.8) -0.5 (1.7) Source: PCA / Savills Research Note: 10yr Average shown in brackets Canberra Civic Key Indicators Canberra Civic A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 6,000 8,500 4,000 5,500 savills.com.au/research 23

24 Canberra Non-Civic Key Indicators Canberra Non-Civic A Grade B Grade Low High Low High Rental Gross Face ($/sq m) Rental Net Face ($/sq m) Incentive Level Net Rental Net Effective ($/sq m) Outgoings Operating ($/sq m) Outgoings Statutory ($/sq m) Outgoings Total ($/sq m) Typical Lease Term Yield Market (% Net Face Rental) IRR (%) Cars Permanent Reserved ($/pcm) Office Capital Values ($/sq m) 6,000 8,500 4,000 5,500 Top Recent Notable Sales Property Price Date NLA Yield Type $/sq m 14 Childers St, Canberra Dec-17 15, e 6, Sydney Ave, Forrest Nov-17 9, e 5, Mort St, Canberra Jun-18 9, i 5,861 6 National Cct, Barton Feb-18 6, e 6, Cameron Ave, Belconnen Jul-18 14,900 n.a n.a 1,604 Queen Victoria Ter, Parkes Jan-18 4,958 n.a n.a 3,116 Yield Types: i = Initial, r = Reported, e = Equated, v = Vacant, dev = development; * Includes $10m in unpaid incentives savills.com.au/research 24

25 Savills insite Property Insights... Anywhere, Anytime Sales Data Leasing Data Economic Metrics Developments Excel Data Files Reports Database Geo-Mapping Charting Functionality PowerPoint Slides News Summaries $187 billion of office sales recorded $79 billion of industrial sales recorded $98 billion of retail sales recorded 12,549 of office leases recorded 9,699 of industrial leases recorded 901 economic data series 4,318 categorised news summaries The Website Designed and coded by research for application across each stage of the property process, the system covers the full spectrum; allowing users to access detailed sales, leasing and development data or download full Excel data files and hundreds of modifiable PowerPoint slides across any device. All data sourced in this document, and significantly more, is accessible to registered clients via Savills dedicated research portal: savills-insite.com.au savills.com.au/research 25

26 Savills Australian Capital Territory Research Shrabastee Mallik +61 (0) smallik@savills.com.au Savills New South Wales Research Shrabastee Mallik +61 (0) smallik@savills.com.au Metro & Regional Sales Robert Lowe +61 (0) rlowe@savills.com.au Valuations Phil Harding +61 (0) pharding@savills.com.au Occupier Services Javan Matheson +61 (0) matheson@savills.com.au Office Leasing Rob Dickins +61 (0) rdickins@savills.com.au Capital Transactions Andrew Stewart +61 (0) astewart@savills.com.au Valuations Andrew Pannifex +61 (0) apannifex@savills.com.au Asset Management Howard Chapman +61 (0) hchapman@savills.com.au Leasing Pip Doogan +61 (0) pdoogan@savills.com.au Capital Transactions Ian Hetherington +61 (0) ihetherington@savills.com.au Project Management Gavin Boswarva +61 (0) gboswarva@savills.com.au Savills Queensland Research Shrabastee Mallik +61 (0) smallik@savills.com.au Valuations Brett Schultz +61 (0) bschultz@savills.com.au Capital Transactions Anthony Ott +61 (0) aott@savills.com.au Office Leasing John McDonald +61 (0) jmcdonald@savills.com.au Sunshine Coast Scott Gardiner +61 (0) sgardiner@savills.com.au Gold Coast Kevin Carmody +61 (0) kevin@savillsgc.com.au Asset Management Shannon Ormond +61 (0) sormond@savills.com.au Project Management Ken Ng +61 (0) kng@savills.com.au Savills South Australia Research Katy Dean +61 (0) kdean@savills.com.au Valuations Heath Dowling +61 (0) hdowling@savills.com.au Capital Transactions Peter Isaksson +61 (0) pisaksson@savills.com.au City & Metropolitan Sales Steve Bobridge +61 (0) sbobridge@savills.com.au Office Leasing Adam Hartley +61 (0) ahartley@savills.com.au Asset Management Jeffrey Klaebe +61 (0) jklaebe@savills.com.au Project Management Steve Christodoulou +61 (0) schristodoulou@savills.com.au Occupier Services Mark Smith +61 (0) msmith@savills.com.au Savills Victoria Research Katy Dean +61 (0) kdean@savills.com.au Valuations Ben Koops +61 (0) bkoops@savills.com.au Capital Transactions James Girvan +61 (0) jgirvan@savills.com.au CBD & Metropolitan Sales Clinton Baxter +61 (0) cbaxter@savills.com.au Asset Management Sarah Hendry +61 (0) shendry@savills.com.au Project Management David Hayden +61 (0) dhayden@savills.com.au Office Leasing Mark Rasmussen +61 (0) mrasmussen@savills.com.au Occupier Services Marcus Tanti +61 (0) mtanti@savills.com.au Savills Western Australia Research Katy Dean +61 (0) kdean@savills.com.au Office Leasing Shelley Ritter +61 (0) sritter@savills.com.au Valuations Mark Foster-Key +61 (0) mfosterkey@savills.com.au Asset Management Jason Ridge +61 (0) jridge@savills.com.au Capital Transactions Graham Postma +61 (0) gpostma@savills.com.au Project Management Graham Nash +61 (0) gnash@savills.com.au City & Metropolitan Sales Chas Moore +61 (0) cmoore@savills.com.au Occupier Services Mark Smith +61 (0) msmith@savills.com.au savills.com.au/research 26