02 STRUCTURAL & EMERGING DEMAND DRIVERS
CUSHMAN & WAKEFIELD | 15
AUSTRALIA'S OCCUPIER MARKET OUTLOOK
WHAT ARE THE DOWNSIDE RISKS FOR 2027? Our 2027 outlook assumes a gradual improvement in occupier demand and business confidence. However, there are several downside risks to this outlook. Should one or more of these risks materialise, the recovery in occupier demand could be delayed.
01 INTEREST RATES RISE FURTHER
02 HOUSING WEAKNESS BECOMES A MAJOR HEADWIND
03 GEOPOLITICAL UNCERTAINTY PERSISTS
04 DEFERRED DEMAND REMAINS DEFERRED
Persistent inflation could result in further tightening or a slower easing cycle than currently anticipated. Higher borrowing costs would place additional pressure on household spending, business investment and occupier confidence.
A more prolonged decline in house prices could weigh on discretionary consumer spending through the wealth effect. This would impact a broad range of occupiers including retail, wholesale, logistics and housing related manufacturing sectors. A weaker housing market would also likely mean fewer homes are built as developers can’t meet required sales prices to justify development.
An extended Middle East conflict could continue to disrupt global trade flows, energy markets and business confidence. Ongoing uncertainty may encourage occupiers to delay major property decisions and maintain a more cautious approach to network expansion.
A large volume of active requirements have been postponed in 2026. If economic conditions fail to improve, a portion of these requirements may remain on hold, reducing the scale and timing of any recovery in net absorption.
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