Perth prime office rents to average 5.5% annually from 2026 to 2031

And investor appetite is expected to improve over the short term.

Robust base office demand and limited supply in Perth will continue to support accelerating prime net effective rent growth, forecast to average 5.5% annually from 2026 to 2031, according to a JLL report.

Investors are likely to remain selective in terms of potential acquisitions. However, the recent easing of interest rates, along with potential further easing, may boost the attractiveness of office assets.

Here’s more from JLL:

Headline vacancy in the Perth CBD decreased 0.1 percentage points (pps) to 15.7% in Q1 2025. The prime grade vacancy rate also decreased 0.1 pps to 13.3%, driven by expansionary activity by both small and large occupiers (>1,000 sqm).

Net absorption in Q1 2025 totalled 2,600 sqm; an improvement from the previous quarter’s reading of -2,300 sqm. On a rolling annual basis, the net absorption reading is 15,200 sqm.

New office supply additions expected to remain low

No major projects completed over the quarter. However, two projects in the Perth CBD remain under construction, totalling 37,400 sqm, with both expected to complete in Q2 2025.

Other than the projects currently under construction, there are 11 projects in the Perth CBD with plans approved, totalling 299,100 sqm. Nevertheless, proposed new office projects are likely to require substantial pre-commitment to proceed.

Prime office yields were stable over the quarter

Average prime net face rents were stable over the quarter at AUD 663 per sqm p.a., reflecting year-on-year growth of 1.4%. Average prime net effective rents were also unchanged over the quarter at AUD 286 per sqm p.a., with year-on-year growth of 1.0%.

Perth CBD prime office yields were stable over Q1 2025 at a midpoint of 7.38%, with secondary yields also stable at a midpoint of 9.00%. On an annual basis, prime office yields softened 25 basis points (bps).