The latest SAPOA Office Vacancy Survey for Q3 2011 compiled by IPD SA reports that over the past three quarters the vacancy growth trend has been modest and in Q3 2011 increased by a further 20bpp on Q2 2011 reaching a new two-year cycle high of 10.2%.

The increase represents a 230bp growth on two years ago and a 50bp increase on the previous year. 

Across the country, prime space ("A" Grade offices) is performing substantially better than lower grade stock and presently the A grade vacancy rate is at 8.0%, having peaked in Q1 2011 when it was at 8.4%. By comparison, negative take up appears to have impacted B grade offices the most. C grade space has come down in both vacancy and total stock, the latter trend attributed to refurbishing strategies undertaken by landlords in pursuit of the A grade market.

In general, although the amount of supply in the form of new committed development has increased modestly from around 490,000m² to over  540,000m² over the past 12 months, the ratio of unlet space has come down by 10.5% over the same period.