Return to Office Gains Momentum—But Melbourne Struggles to Catch Up
Australia’s Return to the Office Gains Momentum—Except in Melbourne
The return-to-office trend is accelerating across Australia’s major cities, with office attendance steadily approaching pre-pandemic levels. However, Melbourne remains a stark outlier, struggling to recover as workers continue to embrace remote and hybrid work arrangements.
Perth and Brisbane Lead the Office Comeback
According to CBRE data, Perth is leading the charge, with office attendance now at 90% of pre-COVID levels. Brisbane is also experiencing a surge, hitting 88%, largely attributed to the state government’s decision to permanently introduce 50-cent public transport fares.
Tom Broderick, CBRE’s head of office research, highlights the role of accessible transport in driving this recovery:
“Brisbane has been the standout following the now permanent cut in public transport fares. While most of the boost to public transport usage has been on weekends, there is also clear evidence of a lift in peak hour weekday usage, which is driving better office attendance.”
Other cities are also showing strong improvements:
Adelaide: 83% office attendance, up from 78% a year ago.
Canberra: 65%, up from 54%, as election season ramps up.
Sydney: 76% weekly attendance, with peak days (Tuesdays) reaching 87%.
Melbourne’s Ongoing Office Exodus
Melbourne continues to struggle with return-to-office rates, averaging just 61% attendance across the week. Even on its busiest day (Thursday), it only reaches 71%, while Fridays remain alarmingly low at 47%.
This sluggish return has become a growing concern for major landlords like Dexus, which owns a significant portfolio of office spaces across the country. Dexus CEO Ross Du Vernet has expressed frustration with the Victorian government’s lack of urgency in bringing public servants back to work.
“The sense we get from our customers in Melbourne is they are really yearning for leadership on this. It is improving but it is slow and it is a noticeable difference from CBD Sydney, Brisbane and Perth.”
What’s Holding Melbourne Back?
Several factors contribute to Melbourne’s sluggish office return:
Long COVID-19 Lockdowns
Melbourne endured the longest lockdowns in Australia, significantly shifting workplace culture towards remote work.
Government Policies
Unlike NSW Premier Chris Minns, who has actively pushed for public servants to return to the office, Victoria’s government has been more passive.
Public Transport Costs & Convenience
While Brisbane’s cheaper fares have boosted CBD activity, Melbourne has not implemented similar incentives to encourage office attendance.
Changing Work Preferences
Many businesses and employees have normalised hybrid work, leading to reduced office occupancy, particularly on Mondays and Fridays.
The Impact on Commercial Property & Private Lending
With fluctuating office attendance, commercial landlords face mounting challenges. Vacancies remain high in Melbourne, placing downward pressure on rental yields and affecting the overall viability of office investments.
This shift presents opportunities for private lending and alternative investment strategies. For investors considering commercial property in cities with strong office attendance (such as Brisbane or Perth), private credit can provide flexible financing solutions to acquire or develop office spaces in high-demand areas.
Why Renown Lending is the Perfect Partner
At Renown Lending, we understand the evolving nature of commercial real estate and the challenges faced by investors, landlords, and businesses. Here’s how we can help:
✔ Tailored Financing Solutions: Whether you're investing in commercial office space or looking for alternative funding options, we offer property-backed short-term finance that traditional banks can’t match.
✔ Fast Approvals & Flexible Lending: With minimal red tape and a straightforward approval process, we ensure you access funding quickly to take advantage of market opportunities.
✔ Expert Insights on Market Trends: Our team closely monitors commercial real estate trends, helping clients make informed investment decisions.
✔ Diverse Loan Products: From 1st and 2nd mortgage lending to mezzanine finance, we provide structured solutions that align with your investment strategy.
Final Thoughts
While return-to-office rates are improving, Melbourne remains the biggest laggard, creating uncertainty for landlords and investors. Cities like Brisbane, Perth, and Sydney are showing stronger recoveries, making them prime locations for commercial property investments.
For investors looking to capitalise on these trends, Renown Lending offers expert guidance and flexible financing solutions to navigate the evolving market. Whether you're purchasing commercial property or seeking funding for development, we ensure you stay ahead of the curve.
Looking to invest in commercial property or need alternative financing? Contact Renown Lending today for expert-backed solutions tailored to your needs.
