JLL Perspectives
Ep5: The 'haves' and 'have-nots' of offices and why mortgage distress headlines are misleading - with Andrew Ballantyne, JLL
Aug 10, 2023
Exploring the impact of COVID on office space trends, sustainability driving desirability gap, investors staying put, retail fairing better than expected, and questioning the severity of mortgage stress.
20:53
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Quick takeaways
- Prime grade assets in the office sector are outperforming secondary grade assets, creating a significant desirability gap for investors.
- Sustainability, changing workspace needs, and ESG considerations are reshaping real estate evaluations, prioritizing asset credentials over traditional grading classifications.
Deep dives
Office Sector: Prime Grade vs. Secondary Grade Assets
The podcast discusses the office sector's performance, emphasizing a significant gap between prime grade and secondary grade assets. Prime grade assets, including older properties, continue to attract investment and show positive absorption rates, while secondary grade assets record negative absorption. This trend is particularly pronounced in Sydney and Melbourne, where prime assets outperform secondary ones. In contrast, other markets like Perth and Brisbane demonstrate higher absorption rates, reflecting a more varied performance across different geographies.
