Australia’s central business districts are taking a long while to recover from the effects of COVID-19 social restrictions, with new data revealing a slowdown in the rate of workers returning to their offices.
According to the Property Council of Australia’s latest office occupancy survey, most of the nation’s CBDs experienced little growth in the number of workers returning to offices last month.
In fact, following snap lockdowns in both Melbourne and Perth last month, both cities recorded fewer workers in CBD offices at the end of February than they had at the end of January.
Melbourne’s CBD recorded only 24 per cent occupancy in the final week of February, compared to 31 per cent at the end of January, and Perth’s rates were at 65 per cent, down from 66 per cent a month prior.
The strongest growth in CBD occupancy rates was in Sydney, where 48 per cent occupancy was recorded last month, up from 45 per cent in the final week of January.
Property Council Chief Executive Ken Morrison said the survey results demonstrated there was a long path ahead when it came to fully reactivating Australia’s commercial centres.
He said the data showed that last month’s snap lockdowns impacted CBD workers’ ability to go back to their traditional office spaces and also their confidence to return.
Mr Morrison said although it was expected that more people would continue to work from home as part of the new post-COVID normal, a return to thriving CBDs would be critical for the nation’s economic recovery.
“Lively city centres are not only important for the thousands of businesses who rely on foot traffic, but also for millions of jobs and hundreds of billions of dollars in broader economic activity generated in our CBDs,” Mr Morrison said.
He said it was vital for policymakers, employers and the property industry to collaborate in the months ahead in an effort to boost office occupancy levels.
“There is an economic imperative for all stakeholders to instigate policies and initiatives that will ensure our CBDs return to full activity as quickly as possible,” Mr Morrison said.
Worker preferences for greater flexibility was identified by survey respondents as the main obstacle to achieving full occupancy, with government lockdowns and public health restrictions also noted as major contributing factors.
Darwin continues to lead the nation when it comes to CBD workers returning to their offices with 80 per cent office occupancy at the end of February, followed by Hobart at 76 per cent, Adelaide at 69 per cent, Canberra and Perth at 65 per cent, and Brisbane at 65 per cent.
But despite persistently low occupancy rates, Mr Morrison said a growing number of office building owners and managers were expecting to see a material increase in occupancy levels within the next two months.
He said building owners and managers had been working to ensure workplaces were as COVID-safe as possible to support tenant businesses and employees in returning to full productivity.
“Every part of the journey through an office building including foyers, lifts, end of trip facilities, common areas and shared spaces has been reviewed with new practices and protocols put in place to promote health and safety,” he said.
“As Australia’s public health response reaches a new phase and the vaccination program rolls out, we’re looking forward to more CBD workers coming back to their offices to enjoy the benefits of face-to-face connections and collaboration.”