Sydney to see eight new office projects until Q4 2027

These will yield nearly 200,000sqm of stock.

There were three office completions in Sydney totalling 46,900 sqm over the second quarter and no withdrawals in the CBD, according to a JLL report. There is 198,200 sqm of stock under construction across eight projects with delivery between Q3 2025 and Q4 2027.

“There was one completion in the non-CBD office markets. 68 Alfred Street South, Milsons Point (4,700 sqm) completed over the quarter. There is currently 140,200 sqm under construction in the non-CBD markets,” the report said.

Sydney CBD stock increased to 5,393,200 sqm due to multiple completions over the quarter.

Here’s more from JLL:

The Sydney CBD recorded 23,500 sqm of positive net absorption over Q2 2025. This was driven mainly by large tenant (>1,000 sqm) demand as tenants increased their leasing requirements over the quarter.

Seven out of the ten Sydney office markets recorded positive net absorption over Q2 2025. The strongest result in the non-CBD markets was Sydney South, which recorded 16,800 sqm of net absorption while the weakest result was in Macquarie Park (-10,100 sqm).

Prime yields are unchanged over the quarter across the Sydney office markets

Sydney CBD Core prime net face rents grew 0.8% over the quarter and by 6.0% over the year to average AUD 1,492 per sqm p.a. Prime incentives reduced slightly to 33.0%. The reduction in incentives was mainly driven by Premium Grade stock in the Core.

Rental performance in the non-CBD metro markets was negative over the quarter, as face rents remained mostly flat while prime incentives continued to increase. As a result, net effective rents have been flat or negative.

Outlook: Vacancy to lower over near-term as supply dries up

The Sydney CBD vacancy rate is forecast to continue gradually trending downwards over 2025 as major supply completions are limited to 270 Pitt Street (22,700 sqm) while tenant demand remains steady.

The Sydney metro markets’ development pipeline continues to shrink, as increases in construction costs and elevated vacancy rates have pushed projects out into later years or changed their use to alternative uses.