Australia’s commercial property markets in 2025 are surging, with Sydney and Brisbane CBD office valuations drawing heightened attention from investors, corporations, and analysts. The landscape for high-quality office assets is rapidly evolving as premium buildings become increasingly valued, while demand for less modern spaces lags behind.​

What’s Powering the CBD Revival in Sydney and Brisbane?

1. Premium Office Space in Hot Demand: In both Sydney and Brisbane, the focus has shifted decisively to prime, ESG-ready buildings that offer world-class location, amenities, and environmental credentials. Businesses are targeting upper floors in CBD core precincts, with occupancy rates and net absorption especially strong in freshly delivered or recently refurbished towers.​

2. Rising Rents, Intense Competition: Sydney’s CBD premium office rents have jumped, with 2025 seeing effective rent growth of nearly 6% in top-tier properties. Incentives offered to tenants are the lowest since 2021, reflecting tightening landlord conditions. In Brisbane, prime vacancy rates have dropped sharply—premium space is absorbed quickly, while A and B grades show more negotiating leverage for tenants.​

3. Limited New Supply and High Pre-Commitment: The pipeline of new office construction in both cities remains constrained through 2026. Major additions like 205 North Quay and 360 Queen Street in Brisbane are already close to fully leased. With little new stock coming online, modern buildings are commanding valuation premiums and tenants must act early to secure space.​

Breaking Down the Trends

1. Vacancy Divergence: While overall CBD vacancy rates remain elevated, the spread between premium and lower-tier buildings continues to widen. Prime space in Sydney and Brisbane attracts the fiercest competition and highest values, while less desirable stock sees slower leasing and softer pricing.​

2. Incentives and Negotiating Power: Tenants looking beyond ultra-premium will still find elevated incentives and flexible terms—especially in A and B grade offices. However, for the best buildings in the core CBD, early commitment and rapid decision-making are essential.​

3. Investment Case Strengthening: Institutional and private investors are increasingly targeting quality over quantity, betting on sustainability, amenities, and blue-chip locations to outperform in a bifurcating market. Yield stabilization in prime sectors is attracting renewed investment attention.​

What Does It Mean for Valuations?

• 1. The market for Sydney and Brisbane CBD offices is reflecting a clear “flight to quality,” with prime office valuations holding firm or rising while weaker assets offer greater flexibility but lower growth potential.

2. New and recently refurbished towers in core locations are seeing some of the highest competition and rental growth in years, setting benchmarks for how the rest of the market will be valued in 2026.​

Key Takeaways for Investors and Occupiers: 

1. Target Early Engagement in Premium Space: Top-tier buildings in Sydney and Brisbane’s CBD will reward swift, decisive action.

2. Negotiate Harder in A and B Grade Assets: There’s room to move on price and incentives outside the premium bracket.

Conclusion

Sydney and Brisbane’s CBD office sectors are setting new benchmarks for quality, value, and growth. In this evolving landscape, success means recognizing the premium on location, sustainability, and flexibility—and moving decisively in a tightening marketplace.