Australian city centres recorded a major jump in vacant office space. Seems those armies of unemployed people are no longer in suits and skirts - nor are they in offices.
I wrote back in May about the issue: Commercial Property: The Other Shoe to Drop. Today writing for “Primespace” in “The Australian” Turi Condon reports a 40% increase in vacant office space. Nationally vacant space went from 5.9% in January to 8.3% in July. And companies are still not done shedding staff.
(BTW, it feels prescient to have used the “other shoe” title - especially when The Economist writing this week uses the exact same analogy in a sub-head for a story on commercial property.)
Commerical rents have plummeted, with drops between 35% to 50% in Brisbane and Perth. Meanwhile new space is coming on the market. In the next 18 months 1.3 million square metres is due to come on market. That’s the equivalent of all the office space in Adelaide.
Prognosticators say commercial property will be in the doldrums for three years. (They also see a tall dark stranger coming into your life, but details will cost you extra.)
In Berlin there’s a novel way to cover over slumping demand. In Potsdamer Platz a half-built office complex is masked by a ten story facade with a picture of a building painted on it. Did you read that correctly? A ten story tall painting!
That’s as good as the service now on offer to Los Angeles suburbanites. If they tire of brown lawns in their housing complex - due to mortgagee reposessions - they can pay $600 to have the grass spray-painted green. Yes - spray paint. Not those fertilised seeds used to start lawns (those require water). This is a quick-fix gloss-over to make your neighbourhood “new car” clean.
So here’s my business idea. Let’s sell cut-outs of busy professionals who can be propped behind vacant desks. We can create tableaux of typical office situations - Fred from accounts checking football scores. Mary in HR talking on the phone (with bonus sound loop of endless chatter!). The logistics department gathered in the boss’ office to settle the Seattle issue. This way today’s office workers won’t feel so lonely in their empty offices.
Who knows - if productivity improves we might lose a model or two to upper management!
