Rail projects on track to boost demand for Sydney CBD offices
Sydney’s new light rail and metro train lines are expected to significantly drive tenant demand over the coming years, with the appeal of buildings at the southern end of the CBD, as well as those between Central and Town Hall stations, set to have strong appeal.
Knight Frank NSW head of office leasing Aaron Weir said the new light rail in Sydney had restored George Street to its former glory of about 100 years ago as Sydney’s main high street.
“Real estate along George Street has enjoyed significant uplift, and we’re seeing rentals increase,” he said.
“There are multiple factors contributing to this uplift, including supply and demand, however, a significant factor has been the redevelopment of George Street, including the Sydney light rail.
“Once the metro is completed, it will place North Sydney four minutes from Barangaroo and six minutes from Martin Place. Major occupiers are telling us that they now see North Sydney as a northern extension of the CBD financial core with this level of accessibility.”
Justin Hayes, JLL NSW office leasing director, said tenants and landlords would benefit from the light rail and metro train lines providing easy access to all parts of the CBD – effectively making the CBD one precinct.
“Ease of access to the CBD will expand the talent pool and allow employees to not be bound by location to access the desired jobs/careers. The true effect will be realised as soon as the light rail is running and the CBD will evolve to a true world city,” he said.
Mr Hayes said the transport options were already resulting in a centralisation of tenants from suburban markets, with war for talent a key driver in location decisions.
“Pharmaceutical and tech industries are leading the way in securing CBD offices where the talent wants to be, not just during office hours but focusing what staff can do when they finish the day,” he said.
A 32-storey, A-grade office tower – 320 Pitt – situated close to the new metro line and light rail had been popular among tenants, Mr Hayes said.
“Savvy landlords like ARA and tenants are certainly changing their perception of the evolving precincts and can’t ignore the amenity and value proposition of an asset like 320 Pitt Street.”
Colliers International office leasing national director Cameron Williams said office buildings in Surry Hills were also set to benefit from the completion of the light rail, with convenient access to Central Station and George Street.
