Cushman and Wakefield | The Occupier Reset

CUSHMAN & WAKEFIELD | 5

AUSTRALIA'S OCCUPIER MARKET OUTLOOK

RECOMMENDATIONS Practical steps for occupiers, developers and investors as conditions begin to shift.

OCCUPIERS

DEVELOPERS & INVESTORS

ASSESS THE WHOLE OPERATING COST Compare facilities on transport, labour, storage capacity and occupancy cost. A higher rent may be justified where the building or location reduces costs elsewhere in the network. BUILD THE RELOCATION PAYBACK CASE EARLY Account for fit-out, racking, rent overlap and downtime alongside expected operating savings. Test how landlord support and the timing of incentives affect the upfront cost.

DESIGN AROUND OPERATIONAL CAPABILITY Prioritise specifications that increase capacity and throughput, including clear height, yard configuration and automation readiness.

ADDRESS THE COST OF OCCUPIER MOVEMENT Flexible handover, early access, racking support and make-good assistance can help occupiers overcome the upfront cost of relocation.

REVIEW THE NETWORK BEFORE REPLACING A LEASE Test whether fewer, more capable facilities could meet current requirements and provide capacity for growth. A renewal may preserve an inefficient network.

MATCH DEVELOPMENT TO LOCAL DEMAND Test speculative projects against available competing space and active requirements. Several key markets now have a shortage of options above 15,000 sqm, while more broadly the sweet spot for demand remains in the 3,000-10,000 sqm size bracket. A pre-lease may provide a clearer path to commencement. ASSESS SECONDARY ASSETS AGAINST PRIME COMPETITION Review whether upgrades can close gaps in building function and operating performance. Assets that cannot meet changing requirements may face longer vacancy and greater incentive pressure.

PLAN AHEAD FOR SPECIFIC REQUIREMENTS Suitable options can be scarce even when headline vacancy is elevated. Allow time to assess optimal requirements well before an existing lease expires.