The relocation and rightsizing trend continues

• Grade A office space recorded substantial positive net demand in Q4 2025, reaching around 38,000 sqm and bringing the annual total to approximately 86,000 sqm. The oil & gas sector led leasing activity by volume, followed by financial services and technology companies.
• The quarter saw a major boost from oil & gas activity, which made up more than half of total net absorption. This was driven by a large relocation into the CBD, where an oil & gas company moved over 25,000 sqm into the newest CBD development.

No new buildings were completed in 2025

• No new Grade A office space entered the market during 2025. Landlords are expected to take advantage of this situation to increase their buildings’ occupancy rates due to the limited supply for the year.
• By the end of 2025, the office vacancy rate stood at around 33%, showing an improvement of 2.3 percentage points compared to Q4 2024. This slight decrease in vacancy was attributed to the limited introduction of new office spaces and stronger than expected demand.

Grade A rents climbed in 2025 with limited supply expected to drive further increases

• Grade A rents increased by 0.87% q-o-q in Q4 2025, marking 3.68% y-o-y growth for 2025. Premium office buildings achieved strong occupancy during the year, and with no new supply expected in 2026, rents are expected to continue rising.
• High-occupancy assets, particularly within the Premium segment in favoured locations, drove rent increases. However, landlords with higher vacancy rates remained flexible with pricing, providing continued opportunities for tenants seeking space.

Outlook

• The supply pipeline remains notably thin, with no significant Grade A office developments expected until 2028 and 2029. This extended period of limited new inventory is likely to support continued market improvement.
• Vacancy rates are projected to continue decreasing, with the overall rate expected to reach 32% by the end of 2026. This downward trend is supported by strong absorption in premium and Grade A buildings, especially those in favourable locations.