Confidence grows in Australia’s retail and office sectors as leases lengthen: Re-Leased

The latest Australian office and retail average lease length figures from commercial property management software company Re-Leased reveal sharp increases over the past year, with business confidence recovering after previously taking hits from the Delta and Omicron COVID variants.

Re-Leased’s CREDIA platform has provided insight into the average lease length data for commercial property in Australia, as well as average lease lengths for the office, retail and industrial sector specifically.

Overall commercial property lease lengths across the retail, office and industrial sectors have increased in the past year from 1.99 years to 2.09 years.

The average lease length for Australian retail commercial properties has increased in the last six months from 2.55 years to 2.79 years in February 2022, and is also up from 2.72 years the same time a year ago.

The average lease length for Australian office properties has also increased, up from 2.11 years in August 2021 to 2.37 years in February 2022. This figure is also up from 1.93 years 12 months ago.

The average lease length for industrial property in Australia has remained stable over the last six months at 1.60 years, after falling from 1.73 years in February 2021.

NSW industrial property lease lengths have dropped in the past year from 1.39 years to 1.30 years, Queensland has dropped from 1.97 years to 1.64 years, while Victoria has been relatively stable, only dropping from 1.98 years to 1.96 years.

Tom Wallace, CEO of Re-Leased said, “From these office and retail average lease length figures, it’s clear to see Australian people and businesses have grown in confidence as vaccination levels increase and the impact of COVID lockdowns subside. It’s encouraging for the economy to see businesses are committing to longer lease lengths.”

“However, there appears to be lingering uncertainty when it comes to industrial property lease lengths in NSW and Queensland, with volatility in these numbers suggesting a lag in confidence.”