1、Tenant PerspectivesNational,local and sector office market insightsAustralia|2023Tenant Perspectives 20232The economic landscape in Australia,like many other regions,has undergone significant transformations,driven by both global and local factors.Our discussions with clients continue to focus on ri

2、sk mitigation and cost efficiencies,while also emphasising sustainability initiatives and improving the overall workplace experience to achieve a meaningful return to work.JLL Research indicates that during the 2022-23 financial year,there was a positive net office take-up of 182,000 sqm for Prime G

3、rade office space in Australia,in contrast to a negative net take-up of 41,000 sqm for Secondary Grade office space.This pursuit of top-tier stock is driven by a desire for improved human experience and the growing imperative to fulfill sustainability criteria.Exceptional office precincts are the ou

4、tcome of a harmonious combination of various elements,each playing a vital role in creating an exceptional workspace.State Governments are actively involved in the rejuvenation and reinvigoration of Central Business Districts(CBDs)through the implementation of significant public infrastructure proje

5、cts.An exemplary illustration of this is the ongoing development of the Victoria Cross Metro Station,a$20 billion project in North Sydney,which is set to serve as a catalyst for transforming North Sydney into a precinct of the CBD,much like Barangaroo or Central.Landlords are investing in creating p

6、ositive tenant experiences by providing amenities such as communal spaces,food and beverage options,and wellness programs.Occupiers are moving into offices with views,collaborative spaces and sleek fit-outs.Put simply,the whole is greater than the sum of its parts,and at the crux of it all are the p

7、eople.Tenants must take the role of a conductor,orchestrating a successful strategy to synchronise efforts that will create flawless symphony amongst flexibility,sustainability,and human experience that resonates with both current and future talent.Sustainability remains a driving force in steering

8、office choice To nobodys surprise,driving the sustainability agenda remains at the forefront of leasing strategy,and for good reason.Tenants are considering sustainability in their office strategy not only to make a positive environmental impact and comply with regulations,but to save costs,attract

9、talent,and gain a competitive edge.With stricter regulations quickly coming in from July 2024 onwards,collaboration between landlords and occupiers will be imperative.Understanding the power of workplace dynamics is key to an office strategy Having a beautiful office is the first step,but the questi

10、on then arises;how do you engage your people?The fact of the matter is work is now an activity rather than a defined office location.There is no one-size-fits-all model for the hybrid workplace,it varies by industry,region,and job function.However,the collective employee experience has shifted in a

11、variety of different ways,and it underscores humanitys adaptability,as well as its vulnerability.Today,a workplace is far more than just a property,its a living environment that allows employees and organisations to craft the best possible fusion of life and work.Take a deep dive into our market ins

12、ights from JLLs latest research across Australias office markets and see how you can take advantage of these conditions.Michael Greene Head of Tenant Representation-AustraliaIntroductionIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202330.0%2.0

13、%4.0%6.0%8.0%10.0%12.0%14.0%16.0%-600,000-400,000-200,000-200,000 400,000 600,0002010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q2 2023sqmNet Increase in StockNet AbsorptionHeadline Vacancy(%)0.0%2.0%4.0%6.0%8.0%10.0%12.0%14.0%16.0%18.0%201020112012201320142015201620172018201920202

14、0212022 Q2 2023Vacancy rate(%)Premium GradeA-GradeB-GradeMarket balanceVacancy over timeTotal stock under constructionVacancy 2023Premium14.9%A Grade14.1%B Grade14.1%591,115 sqm 21 new projects with six new refurbishments to be completed by 2023-24.National CBD office markets 2023Net absorption56,75

15、7 sqmTotal vacancy14.4%Supply93,552 sqm Top five industries on the move in 2023(according to JLL Office Leasing and Tenant Representation transactions)Public Administration&SafetyProfessional,Scientific&Technical ServicesMiningFinance&Insurance ServicesRental Hiring&Real Estate Services12345Key offi

16、ce market trends in 2023Source:JLL ResearchIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 20234AdelaideTop growth industriesPublic Administration&SafetyMost popular office submarketsKey tenant trends Speculative suites offer a convenient option

17、for small tenants who want to avoid construction costs and uncertainties.Private landlords are refurbishing buildings to attract tenants,even in traditionally lower-grade spaces.Larger corporations are focusing on space consolidation,often reducing footprints due to hybrid working and lower office a

18、ttendance post-COVID.Industries on the move Recent corporate moves include NAB from 22 King William Street(6,100 sqm)to 60 King William Street(3,700 sqm),WSP from 1 King William Street(1,150 sqm)to 83 Pirie Street(2,500 sqm)and Deloitte from 11 Waymouth Street(3,800 sqm)to One Festival Tower(7,000 s

19、qm).From Government,Services Australia consolidated into 60 King William Street and Department of Industry and Transport into 83 Pirie Street.SA Health remain active in the market with a brief for 20,000250,000 sqm.Companies with a significant footprint in Adelaide will now be required to wait for t

20、he next development cycle as new buildings are nearly fully leased.An outlook for the rest of the year and beyond Vacancy in the Adelaide CBD is predicted to persist due to occupiers moving to new developments and introducing backfill space.Older buildings face higher vacancy risks,and major corpora

21、tions currently have limited relocation options that match those in other capital cities.The defence,aerospace,and technology industries in Adelaide are promising.ESG commitments will be a deciding factor in key movements as 2030 presents a critical year for many corporates to achieve net zero emiss

22、ions across their business activities.“Analyse workplace utilisation to ensure future space meets current needs and allows for growth.Tenants in lower grade buildings can upgrade as older A-Grade assets undergo regeneration,presenting opportunities for improvement.By proactively planning,you can ens

23、ure secure and strong negotiations,as well as effectively manage the necessary physical aspects of tenancy works.Sophia Klem Tenant Representation-AdelaideNet face rents$452 per sqm(+1.1%QoQ,+6.8%YoY)38.99%incentive$269 per sqm(-0.1%QoQ,+0.3%YoY)41.27%incentivePrime net face rentsSecondary net face

24、rentsOur advice for tenants in AdelaideCore1Vacancy by grade(Premium,A&B)Premium5.8%A-Grade23.1%B-Grade17.3%Based on quarterly net absorptionIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 20235Vacancy by grade(Premium,A&B)Premium8.1%A-Grade13.7%

25、B-Grade12.3%Most popular office submarketsBrisbaneKey tenant trends The Brisbane office market remains buoyed by strong economic growth and positive occupier sentiment.We are experiencing strong leasing activity across all market segments,despite face rental growth which remain offset by elevated in

26、centives.Positive net absorption remains robust in both Brisbane CBD and Near City markets with figures reaching 22,800 sqm and 20,700 sqm respectively in Q2 2023.Industries on the move 2023 has seen greater activity from larger tenants,particularly from top and mid-tier professional service firms a

27、nnouncing their pre-commitment deals.Some of the motivations for these tenant relocations are underpinned by attracting and retaining talent,upgrading premises and building amenity and meeting ESG goals.The most notable tenant commitments year to date are BDO and QIC at 360 Queen Street as well as M

28、inter Ellison and Deloitte at Waterfront Brisbane,North Tower.An outlook for the rest of the year and beyond Whilst there is still strong appetite for quality,the industry continues to be affected by excessive overruns in construction prices and supply chain shortages,reducing landlords motivations

29、to deliver speculative fit-out without guaranteed commitment from tenants.This is also impacting tenants ability to cover the cost of the fit-out within the incentive pool.As such,tenants are forced to consider whether to relocate and upgrade or continue to stay in their current location as the shor

30、tlist of good quality fitted stock and speculative fit-outs decline.Its no surprise additional lease extensions have occurred this quarter as tenants deliberate on their next move.“Brisbane CBD will see a new supply gap until 2025,so we expect vacancy to continue to tighten until the backfill opport

31、unities enter the market.This is creating a noticeable shift in landlord sentiment so we encourage considering your workplace needs sooner rather than later to mitigate risk and maximise your leverage with a structured negotiation strategy.Amanda Foggo Tenant Representation-BrisbaneOur advice for te

32、nants in BrisbaneNorth Quarter1Top growth industriesIndustries consolidatingPublic Administration&Safety Information Media&Telecommunications Administrative&Support ServicesFinance&Insurance ServicesNet face rents$711 per sqm(+3.3%QoQ,+6.7%YoY)42.5%Incentive$512 per sqm(3.4%QoQ,+5.1%YoY)44.46%Incent

33、ivePrime net face rentsSecondary net face rentsBased on quarterly net absorptionIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 20236CanberraTop growth industriesPublic administrationCyber securityVacancy by grade(Premium,A&B)PremiumN/AA-Grade5.6

34、%B-Grade10.2%Most popular office submarkets“Whether it be in the interest of taking advantage of upcoming uncertainty to deliver significant savings,or to ensure access to the buildings for the future,were encouraging our clients to engage with the market early and act now.Andrew McDonald Tenant Rep

35、resentation-CanberraNet face rents$411 per sqm(+0.9%QoQ and+2.7%YoY)25.3%incentive$327 per sqm(+0.8%QoQ,+2.6%YoY)26.1%incentive Prime net face rentsSecondary net face rentsKey tenant trends Were seeing an increase in tenants in a hold and review pattern,preferring to maintain status quo for the shor

36、t to medium term.This is less due to economic uncertainty,and more due to market conditions not compelling relocation,as well as the savings opportunity that exists when using incentive pool associated with renewal as rental abatement.That being said,momentum continues towards speculative fit-outs a

37、nd the opportunity to reduce footprint and occupy more efficient space.Industries on the moveCanberra continues to experience pressure on the sub 500 sqm space and this is chiefly driven by the uplift in new-to-Canberra consultancy partnerships across the Defence and tech industries.Professional ser

38、vices firms continue to hold strong with headcount and quality of space occupied and this resilience is mirrored throughout the majority of“traditional”corporate office occupiers.Commonwealth occupiers are still yet to explore and rationalise their current and future workplace strategies.This is lik

39、ely to be delayed until the arrival of significant lease expiries approaching 2030,upcoming supply pipeline in 2027-29,and leadership from Department of Finance on both workplace strategy and ESG corporate governance.An outlook for the rest of the year and beyondWe are on the precipice of a tangible

40、 shift in the market,driven by a number of significant lease expiries and some influential supply additions over the next two to three years.Were anticipating an adjustment to deal metrics,particularly an uplift in both face rental and incentive pools driven by both construction costs and the additi

41、on of more than 200,00 sqm of stock.Were expecting significant opportunity for occupiers and a shift towards a tenant friendly market.Our advice for tenants in CanberraBartonCivicInner South312DefenceBased on quarterly net absorptionIntroductionKey trendsMarket insightsSectors to watchExpert insight

42、sTeam spotlightTenant Perspectives 20237Melbourne CBDTop growth industriesIndustries consolidatingFinancial ServicesTechnologyGovernmentVacancy by grade(Premium,A&B)Premium21.2%A-Grade15.7%B-Grade14.3%Most popular office submarketsNet face rents$656 per sqm(+1.1%QoQ,+2.7%YoY)40.1%incentive$484 per s

43、qm(+1.1%QoQ,+4.0%YoY)40.4%incentive Prime net face rentsSecondary net face rentsKey tenant trends Throughout the first half of this year we have continued to witness subdued tenant activity.This is largely driven by macroeconomic uncertainty.Tenants have been reluctant to make long-term commitments

44、based on current projections and elected to manage the risk of being in holdover or acting closer to expiry.This has left the broader office market in a state of flux.However,as the fog lifts on the broader economy we are starting to see an increase in activity and planning.Industries on the move Th

45、e current market activity has been relatively subdued compared to the previous quarter.However,its crucial to highlight the recent relocation of Ericsson from Docklands to 555 Collins Street in the CBD.This move is noteworthy as it signifies a trend of larger tenants releasing excess floor space.Eri

46、csson is downsizing from 10,650 sqm to approximately 3,350 sqm,showcasing their desire for higher-quality,sustainable office spaces.Additionally,the increase in sublease space combined with new developments like 500 Bourke Street and 555 Collins Street is contributing to a rise in available office s

47、pace,creating back-fill vacancies.This is further impacting the overall supply in the market.Stakeholders need to monitor these trends closely,as they have the potential to reshape the commercial real estate landscape in the CBD.An outlook for the rest of the year and beyond Interest rates have begu

48、n to stabilise,and we are getting a clearer picture of what the future may look like.Therefore,we expect tenants to come back to the market and exploit the high levels of incentive and landlord concessions available at this point of the property cycle.“In these unchartered waters,we advise all tenan

49、ts to engage an expert to represent them in exploring all options in the market.In the current market there is always a better deal out there.Gellie Mendes Tenant Representation-MelbourneDocklands12Based on quarterly net absorptionWestern CoreOur advice for tenants in Melbourne CBDIntroductionKey tr

50、endsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 20238Melbourne FringeTop growth industriesIndustries consolidatingGovernmentHealthcareProfessional ServicesCoworking GroupsVacancy by grade(Premium,A&B)PremiumN/AA-Grade14.3%B-Grade17.2%Most popular office submarkets

51、Net face rents$517 per sqm(0.2%QoQ,0.3%YoY)32.1%incentive$392 per sqm(-0.1%QoQ,-0.1%YoY)32.2%incentive Prime net face rentsSecondary net face rentsKey tenant trends The sub 1,000 sqm is currently the most active in the market.A large portion of tenant requirements are looking for spaces with a brand

52、 new speculative fit-out or an existing fit-out as occupiers want easy plug and play solutions.Due to the continued demand for fitted space,we expect to see more speculative fit-outs being offered by lessors in the fringe.Industries on the move With the fringe delivering high-quality office building

53、s that is meeting occupiers amenity and sustainability requirements,it has attracted some major and notable new residents to its precinct.The Victorian State Government has consolidated its various CBD office locations and taken 19,000 sqm in East Melbournes newest development at 200 Victoria Parade

54、.Australia Post and Nucleus Networks will also be relocating from the CBD to fringe markets.An outlook for the rest of the year and beyond Increased supply in the medium to short-term will raise the current vacancy rate of 15.2%,leading to lower rents and higher incentives.The Yarra Precinct on the

55、fringe offers excellent amenities,including restaurants,cafes,bars,and good public transport access,creating higher demand for suburban areas there.Smaller occupiers can find A-Grade facilities and whole floor opportunities in the fringe.Investments in the rail network will further boost fringe acti

56、vity in the medium to long-term,providing occupiers with more accessible locations,such as the Young Husband Development accessible from multiple train stations.“Explore the market offerings before renewing a lease or exercising your next option.The office market has certainly evolved in recent year

57、s,with higher quality office buildings,larger incentives,brand new spec suites,and plenty of options to choose from.This is an opportunity for occupiers to gain flexibility,generate savings and upgrade to quality spaces.Wendy Lever Tenant Representation-MelbourneEastern FringeSt Kilda RoadYarraOur a

58、dvice for tenants in Melbourne Fringe312Based on quarterly net absorptionIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 20239PerthTop growth industriesProfessional,Scientific&Technical Services MiningVacancy by grade(Premium,A&B)Premium11.9%A-Gr

59、ade17.8%B-Grade24.2%Most popular office submarketsNet face rents$638 per sqm(+0.1%QoQ,+1.7%YoY)48.19%incentive$386 per sqm(+0.1%QoQ,+1.8%YoY)50.51%incentive Prime net face rentsSecondary net face rentsKey tenant trends There is a growing trend of office centralisation within the CBD driven by the va

60、lue placed on ESG credentials,building and precinct amenities,accessible transport options,and quality of space.Rationalisation of office footprints and upgrading to attract talent are common.The resource and energy sector are fueling project growth,leading to short-term office demand particularly f

61、or energy occupiers and professional services.Good quality fitted spaces have become increasingly attractive given the appetite for project space,key fundamentals being centralisation to corporate head offices.Industries on the move Perths premium office grade has experienced strong activity in the

62、first half of 2023,resulting in reduced vacancy rates.Central Parks vacancy dropped from over 16%to below 4%due to significant building investments.Capital Square Tower 2 in the CBDs West End is almost fully leased.Major movements have come from the resource and energy sector,as well as professional

63、 and technical services.The newly delivered premium grade supply in Elizabeth Quay attracted Tier 1 tenants,and Brookfields OneEQ development is fully leased.With limited future supply,occupiers are prioritising quality.An outlook for the rest of the year and beyond Landlords will continue to focus

64、on ESG credentials,including sustainability measures and electric vehicle charging capabilities.Flexible common areas and integration with public open space are also important.With limited supply,occupiers will carefully consider lease renewals and relocations for flexibility.We expect stable effect

65、ive rents and CBD vacancy rates in 2023 and 2024.“When reviewing your companys office workplace strategy,involve key stakeholders and consultant advisors.Evaluate the value proposition of fitted and speculative fit-outs to minimise major capital expenditure.Buildings with third spaces and common mee

66、ting areas can also improve NLA efficiency.Aligning with coworking providers can reduce space needs and facilitate flexible project growth/contraction.Adam Stanford Tenant Representation-PerthOur advice for tenants in PerthWest End1Based on quarterly net absorptionIntroductionKey trendsMarket insigh

67、tsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202310Sydney CBDTop growth industriesIndustries consolidatingPublic Administration&SafetyProfessional,Scientific&Technical ServicesInformation Media&TelecommunicationsFinance&Insurance ServicesVacancy by grade(Premium,A&B)Premium15.9

68、%A-Grade14.3%B-Grade13.1%Most popular office submarketsNet face rents$1,363 per sqm(+1.4%QoQ,+8.0%YoY)34.5%incentive$971 per sqm(+0.4%QoQ,4.9%YoY)34.1%incentive Prime net face rentsSecondary net face rentsKey tenant trends Many corporates remain on their quest to entice their employees back to the o

69、ffice after a long period of work-from-home dominance.Occupiers are looking to downsize their footprint as they implement permanent flexible work policies,and in exchange,relocate to better quality buildings.Sublease availability continues to come to market,with the largest sublessor being CBA(23,00

70、0 sqm at Darling Square).Others offering sublease space include Salesforce,NTT,Westpac and Lendlease.Industries on the move Given the recent completion of Salesforce Tower at 180 George Street by Lendlease,weve seen many of the occupiers that pre-committed to the building start to relocate,including

71、 Tourism Australia,JLL and ZipMoney.Salesforce will also begin to relocate to their new 20,000 sqm head office where they secured naming and signage rights for in September 2023.We are also witnessing a stark difference in demand between the Western Corridor and CBD-Core submarket.The Western Corrid

72、or has a vacancy rate of 16.9%,while the CBD-Core submarket has a rate of 11.9%(significant proportion emanating from one major backfill vacancy),representing a 42%increase for the Western Corridor compared to the CBD-Core.An outlook for the rest of the year and beyond Corporate tenants are increasi

73、ngly prioritising sustainability in their workplace decisions.Building sustainability ratings and plans for electrification are key factors in lease considerations.Assets with a clear path to net zero are in high demand,while those with poor ESG credentials are less desirable.This supports the trend

74、 of tenants seeking quality assets,as landlords of prime grade properties are willing to upgrade sustainability credentials and future-proof their assets.“The high level of vacancy in the market can be deceiving,as we are experiencing a two tiered market whereby the availability of stock in good qua

75、lity prime grade stock is surprisingly limited.Start the approach to market a minimum of 12 months prior to lease expiry(earlier for larger tenants)to ensure all potential options are uncovered,and market leverage can be created.Zoe Willis Tenant Representation-SydneyOur advice for tenants in Sydney

76、 CBDCore1Based on quarterly net absorptionIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202311Sydney MetroTop growth industriesIndustries consolidatingProfessional servicesEducationPublic SectorManufacturingVacancy by grade(Premium,A&B)Premium7

77、.8%A-Grade16.4%B-Grade20.1%Most popular office submarketsNet face rents$686 per sqm(0.0%QoQ,4.9%YoY)36.2%incentive$533 per sqm(-0.1%QoQ,2.9%YoY)33.4%incentive Prime net face rentsSecondary net face rentsKey tenant trends Tenants continue to focus on enhancing workplace design and flexibility,right-s

78、izing to suit new ways of working,meeting environmental commitments and achieving cost efficiencies.Metro landlords are having to work in partnership in key areas such as sustainability to retain tenants,especially after numerous lease term cycles of being within the same building.There is also the

79、emergence of a resimercial design trend,whereby corporates are creating workplaces of the future consisting of a layout and furnishing style that brings the homely feel of residential furniture into the office.Together with ample soft furnishing,warm colour palettes,collaboration zones and third spa

80、ces like guest lounges,bars and cafes,it celebrates commercial quality,residential-inspired features over the sterile and standardised feel of corporate furnishings.Industries on the move Certain metro tenants,including pharmaceutical firms,are opting to move to core areas and seek higher-quality sp

81、aces.New premium towers in North Sydney,for example,are attracting tenants previously based in suburban locations like Chatswood and Macquarie Park.Factors such as enhanced amenities,excellent public transport access,and appealing precincts play a significant role in their decision-making process.An

82、 outlook for the rest of the year and beyond Large corporates will continue to right-size and dispose of surplus space,whilst investing in the design and fit-out of their core tenancies to create more collaboration areas and third spaces,away from the traditional high-density workstation set-up.Attr

83、acting staff back into the office still remains a key focus.“Time and options create the necessary leverage within the current tenant favourable marketplace.We have been successful in working with clients to downsize their space requirement and relocate to both a better building,fit-out and more cor

84、e location whilst still remaining cost-neutral compared to the current rental costs of the stay-put option.Paul Kilbane Tenant Representation-SydneyOur advice for tenants in Sydney MetroSydney Fringe1North Sydney2Based on quarterly net absorptionIntroductionKey trendsMarket insightsSectors to watchE

85、xpert insightsTeam spotlightTenant Perspectives 202312Sector insightsThe legal sector remains highly active due to the significant gap between legal fit-outs and post-COVID workplace models.Law firms are opting for high-quality buildings in central CBD locations.In Sydney,many firms are seeking and

86、competing for new developments in the Core sub-market between 2022-28,leading to early engagement in the market before their lease expires.Sustainability is a top priority,with firms prioritising green lease provisions,high sustainability ratings,and net zero ready buildings.Based on a recent JLL su

87、rvey of 25 of the largest law firms in the country,we expect to see a wholesale shift towards more open plan workplace models in coming years.Most firms reported a lack of amenity,appropriate collaboration spaces and meeting spaces as being key hurdles to increasing office attendance levels.Firms ar

88、e also reviewing the long-term need for function amenities within their tenancy(commercial kitchens,town hall spaces etc.)and looking to the base building to provide these services.The industry is experiencing a major change in how space is used.Retail banks are reducing office space,while investmen

89、t banks prioritise office presence for staff.This has led to further bifurcation of the office market,with premium grade assets in core locations leased by investment banks showing high occupancy levels,while premium grade assets in non-core locations have lower occupancy and leasing activity.The di

90、stinct variation in demand in the two markets is best highlighted through the differing levels of vacancy between the Western Corridor and the CBD-Core submarket in Sydney.All in all,the sector has seen a lot of activity with regards to the treatment of office space,both with the take-up and hand ba

91、ck of it.For the short to medium-term future,we anticipate the two sub-sectors of retail and investment banking to further divide from one another,both in terms of their occupancy and the continuing utilisation of hybrid working settings.Get in touch with our banking and finance expert Alex ChurchGe

92、t in touch with our legal expert Anthony ClarkBanking&FinanceLegalIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202313Sector insightsThe Australian Government has been investing in Australias Defence capability with announcements like AUKUS and

93、 Guided Weapons.There is preparedness by the market to establish new precincts and technology parks in anticipation for the delivery and maintenance of such capability and facilities.Examples of such precincts include Lot 14 and the Entrepreneur and Innovation Centre(EIC)in Adelaide,which will be ho

94、me to space,Defence hi tech and creative industries.The sector faces challenges in staffing,managing hybrid workforces,and maintaining technical facilities for innovation and national security.The future of Defence workplaces involves traditional CBD offices and specialised facilities near key sites

95、,offering job growth and regional opportunities.However,attracting employees to regional areas can be challenging due to limited lunch time amenity and housing supply.We closely monitor these developments to support our Defence industry clients in meeting customer requirements.We recently conducted

96、an industry survey to validate anecdotal reports of changes in workplace behaviours that are influencing demand for office space,unveiling some interesting findings.While the hybrid model is embraced,over 66%of respondents havent implemented a long-term post-COVID workplace strategy aligned with uti

97、lisation.Cost savings are now a top priority,leading to strategies like early lease restructures,right-sized relocations,and disposals.The professional services sector contributes to sublease and backfill vacancy,emphasising the importance of flexible workplace policies,in-office technology,and supe

98、rior amenities for higher office utilisation.Managing peak day occupancy remains a challenge,with only 50%of respondents exceeding 75%occupancy.Considering an overwhelming majority of our respondents have identified the opportunity and need to refit or relinquish surplus area,we expect to see a cont

99、inuation of rationalisation and right-sized relocations aimed at improving overall employee experience (and of course reducing cost)!DefenceProfessional ServicesGet in touch with our Defence expert Jessica Van RaayGet in touch with our professional services expert Nelson WrightIntroductionKey trends

100、Market insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202314No longer just a minor consideration,net zero carbon commitments have become a powerful driver in commercial lease strategies for occupiers.Beyond the imperative to combat climate change,these commitments offer num

101、erous advantages,including strengthening relationships between landlords and occupiers reducing operating costs,enhancing employee engagement,and ensuring regulatory compliance.There is also a need for transparency around data and reporting.Specifically,from 2024 onwards,companies with over 500 empl

102、oyees,$500M in revenue and$1B in assets will be required to disclose information about their sustainability-related risks and opportunities(IFRS1)and climate-related risks and opportunities(IFRS2)to investors in their annual statements.These new reporting standards from the International Sustainabil

103、ity Standards Board(ISSB)and International Financial Reporting Standards(IFRS)have been welcomed by the global ESG community to provide more consistency and comparability in global ESG reporting.With stricter regulation comes the minimisation of false and misleading sustainability claims.The Austral

104、ian Competition and Consumer Commission(ACCC)has recently taken a notable step towards promoting transparency and integrity in environmental claims made by organisations.In an important and commendable move,the ACCC has announced its intention to crack down on any entities that engage in misleading

105、or inaccurate representations of their environmental credentials.This initiative necessitates organisations to retract any deceptive assertions,adopt greater transparency regarding their practices,and substantiate their claims with verifiable evidence.Whats next?Connor McCauley Head of Sustainabilit

106、y Australia&New ZealandSustainability1.Measure and manageLook to have the right data management systems in place to start collecting accurate and detailed data on your Scope 1 emissions.Engage third-party consultants,implement monitoring and metering systems,and collaborate with suppliers and contra

107、ctors to obtain relevant information.Occupiers will also need to negotiate more collaborative green lease terms that incentivise data sharing,as failure to include ESG into portfolio selection criteria would be more likely to expose occupiers to transition risk.2.Climate risk and resilienceFrom 2024

108、 onwards,companies must disclose the climate-related risks and opportunities that could reasonably be expected to affect the sustainability of their business.Large companies(over 500 people and$500m revenue)must assess their resilience against future climate change scenarios and should be completing

109、 climate risk assessments this year.3.Go beyond environment to socialCompanies are progressing beyond focusing on environmental issues solely and are now assessing their social licence to operate.Businesses are offering unlimited volunteering days,pro-bono services and partnering with purpose-driven

110、 social enterprises and small businesses to do more good in the communities in which they operate.IntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202315Office design&buildScott McCrossin Managing Director Project&Development Services-AustraliaThe

111、 workplace is now more than ever a place to make connections,stimulate creativity,team collaboration and a catalyst to enable employees to be their best selves.With work now truly boundaryless employees are seeking a safe,productive and seamless experience that satisfies their personal and professio

112、nal needs.However,many organisations are still struggling to entice their employees back to the office and utilisation trends across Australia are still averaging 30%(according to XY sense sensor data).JLLs new Sydney office is a key example of a successful hybrid workplace delivery,resulting in a s

113、taggering uplift in workplace utilisation over the past six months since its opening.A report recently published by McKinsey(Empty spaces and hybrid places)noted that office attendance is down by 30%.However,JLLs new workplace is seeing an average occupancy rate of 66%;a contrast to Sydney CBD trend

114、s.The new workplace is located across three floors of Salesforce Tower,in the heart of Sydneys CBD.Celebrating the power of connection,almost 50%of the NLA is work caf environments which wrap around a central staircase that connects the three floors.This unique design feature has drastically changed

115、 the way in which people connect and build relationships in the office.The spaces are highly curated by the workplace experience team,offering an onsite barista as well as a plethora of events and activities.While office fit-outs are necessary to reflect the evolution of a business and new ways of w

116、orking,managing the construction process in the current climate comes with many challenges.With a 14.8%year-on-year increase in average costs across 2022-23,labour market shortages,pressures to meet sustainability requirements,and extended supply chain timelines,tenants need to focus on the purpose

117、of their office space,and striking the perfect balance between collaboration,flexibility,and individual work preferences.JLL Sydney officeIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202316Workplace strategySonya Alexander Head of Workplace Co

118、nsulting Asia Pacific RegionWhats next?Invest in people and better spaces In a recent JLL survey,77%of companies prioritise investing in quality over expanding total space.Its crucial to maintain a positive workplace experience and invest in healthy,inspiring,and efficient spaces to attract top tale

119、nt and drive innovation.Create a new employee value proposition Companies must test new ways of working to adapt quickly to changing business processes,tools,and employee preferences.Remaining competitive requires creating a new employee value proposition,where the office fosters innovation,culture,

120、and shared purpose.Start planning for the future of work Commercial real estate is at a critical point,converging on aspects of business transformation,digital adoption and sustainable operations.To remain relevant,companies need to have started their due-diligence to create new guidelines around AI

121、,technology accelerated ESG,and product innovation programs to stay ahead of the competition.What is impacting the workplace right now?The year of 2023 was predicted to be the year of the post-pandemic change to grow,innovate and establish the new normal.JLL Research shows companies that have an off

122、ice in Sydney would agree that the last 18 months have been a challenging period when managing evolving workplace;the flexible working phenomenon meant if left untouched,the office attendance was low and sporadic at best.As such,it was beginning to impact organisational culture,synchronous collabora

123、tion,productivity(for some teams)as well as mental and social wellbeing.Companies took the opportunity to take a cultural temperature check across the organisation finding that their property and workplace no longer reflected their workforce or ways of working.Through the Tenant Representation team,

124、we experienced increased requests for workplace strategy activities when going to market and looking for space.This was especially prevalent from the financial,insurance and government industry sectors to assist in developing a strategy that had a competitive edge when attracting the top digital tal

125、ent.Moreover,both private and public occupier clients have enquired about strategies linked to productivity and hybrid effectiveness,asking key questions around bringing workplace back to life by developing new wellbeing initiatives and flexible ways of working in their business.One of the most impo

126、rtant parts of the workplace strategy is the data driven due-diligence;only when the business,space and people data are synthesised,can the company take a holistic view of how space is valued.With technology,AI tools and their adoption at the heart of any future workplace experience,workplace strate

127、gy process must factor in the business introducing new skills and mobility etiquette across what is likely to be across the four generations of employees.As we look towards the future and what the next year will bring,there are some clear emerging trends that you should consider:IntroductionKey tren

128、dsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives 202317Change managementIn the first half of this year,there has been a notable shift in organisational workplace change programs.These programs now place a greater emphasis on optimising the occupancy rhythm throughout

129、 the week.Specifically,there is a prevalence of employees working from the office for two to three days,leading organisations to be more intentional and thoughtful about collaboration and social connection.This shift has also resulted in a “flight to quality”in the real estate market,particularly fo

130、r small and medium-sized organisations.These companies have taken advantage of the opportunity to relocate to pre-fitted spaces previously occupied by larger corporations that have been able to consolidate.By reusing existing workplace designs,fit-outs and furniture,these organisations have not only

131、 minimised their environmental impact but also aligned with environmental waste reduction targets.Furthermore,recent announcements regarding the expected increase in Federal Government headcount,along with the greater flexibility offered for public sector roles and the renewal of Enterprise Bargaini

132、ng Agreements,have created a greater expectation for government agencies to reevaluate their office portfolios and ensure they are appropriately sized.Additionally,they now allow greater access to flexible working arrangements for public sector staff,meaning acknowledgement of step change in how Aus

133、tralians are using office spaces.Fiscally,this enables the opportunity to revise property budgets and align more effectively with occupancy.Owners are responding accordingly,reviewing what they can do to make their assets more attractive to future tenants and current communities.Meanwhile,occupiers

134、continue their discovery of why and when people come are coming into the office.There is now greater collaboration with employees on what would make the experience more purposeful at both a professional and social level.We are also seeing greater engagement with landlords resulting in better communi

135、ties being established.From a physical sense,large occupiers and investors are focused on repositioning and/or consolidation of assets and will continue to focus on the future;refining strategies to get to balanced occupancy levels,adaptive offices,meet sustainability targets and have a thriving wor

136、kforce.This includes development of precincts,so the office is a destination that supports the Australian lifestyle.Charted Accountants ANZ|Design&Build 16,000 sqm asset redevelopment 800 sqm Pilot Floor Project on Level 3 With an aging Sydney CBD asset in ownership,JLL worked with CAANZ to deliver

137、a pilot floor that is being shared by all their people located in Sydney CBD.With varying team days,CAANZ can now seamlessly collocate teams who previously could not due to static work environments as well as measure occupancy to finalise strategy for their own tenancy vs ability to release space to

138、 lease out.Sherrie Jones Workplace Strategy Lead-NSWIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives18Team spotlightTell us about your background that led you to be here today?Through an element of luck,I found myself in an analyst role in Office

139、Leasing at JLL.This opportunity stemmed from a general conversation about an interest in property as part of my university degree and work experience at JLL happened from there in 2010.Why did you choose to work in Tenant Representation?What appealed to me about this team was that you get to help pe

140、ople,its analytical,and as part of our engagement you still drive transactions and negotiated outcomes.Every client we work with is different and you get to understand how their business works,their aspirations,and the cultures they strive for.Building personal and long-standing relationships with o

141、ur clients is very rewarding.Whats the best career advice you have received?By listening to other peoples opinions first,they will feel heard,and it allows you to absorb everyone elses thoughts before you provide your own view,which will be an informed one.Tell us about your background that led you

142、to be here today?I joined JLL in 2008 as part of the Melbourne Graduate Program and rotated through Office Leasing,Captial Markets and Tenant Representation.I was drawn to Tenant Representation for the variety in the role and being able to work across multiple markets.I was fortunate enough to take

143、a lead on a national client account which gave interstate experience across all asset classes.When the opening came up in the team to expand our presence in South Australia,I jumped at the opportunity.Why did you choose to work in Tenant Representation?I joined JLL with a valuations background,howev

144、er,was never sold on the idea of all those reports!Tenant Representation offered a great balance of analysis but with a strong people and relationship focus.This mix suits my personality and ultimately drives me to get the best results for our clients.Whats the best career advice you have received?H

145、onesty is the best policy.I like to play with a straight bat and give honest advice.No point telling people what they want to hear if it cant be achieved.Dirk Van VeldenHead of Tenant Representation-QueenslandJessica Van RaayHead of Tenant Representation-South AustraliaIntroductionKey trendsMarket i

146、nsightsSectors to watchExpert insightsTeam spotlightIntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightTenant Perspectives19Contact one of our experts belowMichael Greene-Head of Tenant Representation-AustraliaNew South Wales Gavin Martin-Head of Tenant Representation-

147、NSW Anthony Clark-Senior Director Luke Dutton-Senior Director Sadaf Mayar-Senior Director Patrick McFarland-Senior Director Nelson Wright-Senior Director Alex Church-Director Paul Kilbane-Director Jackson King-Director Emily Lye-Director,Pursuits Rebecca Azzi-Associate Director,Business Development

148、Kayla Beljan-Senior Consultant Darlene Haryanto-Consultant Zoe Willis-Consultant Georgia Gunnis-Analyst Anna Combarros-Executive Team AssistantAustralian Capital Territory Andrew McDonald-Senior ConsultantVictoria Peter Walsh-Head of Tenant Representation-VIC Edward Hill-Director Gellie Mendes-Direc

149、tor Wendy Lever-Associate Director Isabel Klem-Senior Consultant Sarah Whitelaw-Senior Consultant Sonya Kiker-Executive Team AssistantQueensland Dirk van Velden-Head of Tenant Representation-QLD Amanda Foggo-Director Oliver McCall-Consultant Maddison Taylor-ConsultantWestern Australia Adam Stanford-

150、Head of Tenant Representation-WA Matt Lutman-Director Ashley Weatherall-AnalystSouthern Australia Jessica Van Raay-Head of Tenant Representation-SA Sophia Klem-AnalystVisit .au/tenant-representation for more.IntroductionKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightIntroducti

151、onKey trendsMarket insightsSectors to watchExpert insightsTeam spotlightAbout JLLFor over 200 years,JLL(NYSE:JLL),a leading global commercial real estate and investment management company,has helped clients buy,build,occupy,manage and invest in a variety of commercial,industrial,hotel,residential an

152、d retail properties.A Fortune 500 company with annual revenue of$20.9 billion and operations in over 80 countries around the world,our more than 103,000 employees bring the power of a global platform combined with local expertise.Driven by our purpose to shape the future of real estate for a better world,we help our clients,people and communities SEE A BRIGHTER WAYSM.JLL is the brand name,and a registered trademark,of Jones Lang LaSalle Incorporated.For further information,visit .au