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Sky Scraper office rent prices expected to rise

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Rents are set to rise for Sydney's office towers according to international real estate agency Knight Frank. 

Details of this trend were revealed in the company's Global Cities: Skyscrapers 2015 report, which discusses the potential these tall structures offer in the face of economic and urban issues that cities like Sydney face on a regular basis.  

Knight Frank's Head of Office Agency for Australia, John Preece explains the skyline of Australian cities does not feature as many skyscrapers as other metropolises.  

Now that less land is available and many office spaces are being lapped up for residential blocks, eventually the only option will be to go for vertical development. 

"Consequently, we will soon be left with no option but to go high. Changing demographics also demands higher-density CBDs. People want to live in cities where they can walk to work and have immediate access to a range of leisure and dining options," he added.

The company's Head of Institutional Sales for Australia James Parry said sky scrapers present impressive property feasibility

"There is a shift in the global economy towards city centres of gateway cities, and skyscrapers are successfully delivering the volume and type of homes and offices our cities require," he commented.

The report also outlined the following five future trends for global cities:

  1.  New technology  - Making it cost-effective to live and work in high rise buildings. 
  2. A preference for living in CBD precincts  - people will start enjoying the convenience of living close to work.
  3.  Businesses grouping together - Technology is actually serving to create "business clusters", this means the trend is to huddle together rather than spread out. According to Knight Frank this is anticipated to grow in future, which may spur a raft of new skyscrapers.
  4. Cities will not be as widespread -  Sprawling cities can create infrastructure challenges which can range from transport to community funding. Skyscrapers will present an alternative to a horizontal spread.   
  5. An emerging culture of CBD economic activity outside of business hours - With the number of people wanting to live in the city centre, the CBD will eventually become a hub of evening and weekend economic activity. 

Mr Parry also added that the global real estate capital markets are abuzz with activity from large-scale investors.

Date Published: 08 Jun 2015
Category: General News

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