Perth office rental growth to average 5.5% annually until 2031

Limited supply is driving the increase in rents.

According to a JLL report, a limited office supply pipeline is expected to continue supporting an acceleration in Perth’s prime net effective rents, forecast to average 5.5% annually from 2026 to 2031.

“Projected further cuts in interest rates may boost the attractiveness of office assets in the Perth CBD. However, investors are likely to be selective in terms of potential acquisitions, due to broader global economic uncertainty,” the report said.

Here’s more from JLL:

Headline office vacancy in the Perth CBD increased 1.4 percentage points (pps) to 17.1% in Q2 2025. The prime grade vacancy rate also increased 2.3 pps to 15.6%, attributed to new supply entering the market.

Net absorption in Q2 2025 totalled 5,900 sqm; an improvement from the previous quarter’s figure of 2,600 sqm. On a rolling annual basis, Perth CBD net absorption totalled 9,100 sqm.

Two completions recorded over the quarter

Two major projects completed over the quarter, totalling 37,400 sqm. There are no projects in the Perth CBD currently under construction, with new office supply additions expected to remain low in the short to medium term.

There are 11 projects in the Perth CBD with plans approved, totalling 299,100 sqm. 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 increased 0.3% over the quarter to AUD 666 per sqm p.a., reflecting year-on-year growth of 1.4%. Average prime net effective rents increased 0.5% over the quarter to AUD 288 per sqm p.a., with year-on-year growth of 1.8%.

Perth CBD prime office yields were stable over Q2 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 were unchanged.