Knight Frank’s flagship Australian Horizon 2026 report identifies five key locations where vacancy trends, supply pipelines and pricing are creating opportunity.
Knight Frank Chief Economist Ben Burston said confidence has returned at the top end of the market.
“Investors are increasingly aware of a dwindling pipeline of supply, and that is giving them more confidence in the outlook for rental growth and, in turn, performance,” he said.
Here are Mr Burston’s top five office market picks.
North Sydney: Not What It Seems
At face value, North Sydney could look challenged.
Overall vacancy remains elevated and sentiment has been cautious.
But Mr Burston warns North Sydney cannot be treated as one market.
“The high overall North Sydney vacancy rate belies the stronger performance of the best-quality assets in the area,” he said.
The new metro station had shifted the focal point to the precinct created around Victoria Cross Station.
“We would expect good-quality assets in that location to perform well, regardless of higher vacancy rates elsewhere in North Sydney,” he said.
See latest North Sydney office assets available on CommercialReady here.
Cremorne: Precinct On The Move
While Melbourne’s CBD continues to recalibrate, Cremorne is pulling ahead.
The city-fringe pocket, wedged between Richmond’s transport spine and Melbourne’s sporting and entertainment heartland, has maintained rental momentum, underpinned by strong amenity and lifestyle appeal.
Mr Burston said Cremorne still has room to grow.
“Cremorne has been successful because of its appeal to creative and technology tenants,” he said.
“The location provides access to a skilled workforce, clients and competitors, and that successful clustering is a real bright spot on the Melbourne office landscape.”
See latest Cremone office assets available on CommercialReady here.
Brisbane CBD: Top End Pulling Away
In Brisbane, performance is being driven by asset quality, with premium vacancy sitting at 3.8 per cent in mid-2025.
While backfill space has emerged from new supply, availability in premium and high-A grade buildings has seen quick take-up.
Mr Burston said Brisbane was likely only partway through an extended upswing.
“It’s important to remember that while we have seen strong rental growth in Brisbane over the past three years, rents did not grow at all from 2012-22, so it was coming from a low base,” he said.
“There are many drivers for growth that remain in place, including demand dynamics, the growth of Brisbane as a city, and tight supply at the top end of the market.”
See latest Brisbane office assets available on CommercialReady here.
Perth CBD: Supply Drought Looming
After years of volatility, the Perth market is tightening.
Critically, there are no major new office projects on the horizon for at least three years.
Mr Burston anticipates the looming supply drought will place upward pressure on rents.
“In Perth, the dwindling new supply is even more extreme than elsewhere,” he said.
“So, even with modest tenant demand, we would still expect Perth to perform very well.”
See latest Perth office assets available on Commercial Ready here.
Adelaide CBD: The Quiet Achiever
Adelaide may have flown under the radar in the past, but strong fundamentals are now putting it in the spotlight.
Transaction costs remain comparatively low, prime yields have begun tightening, and competition for quality assets is building.
Mr Burston said this positions Adelaide as a relative value play.
“Post-pandemic, Adelaide and the wider South Australian economy have shown a stronger growth trajectory,” he said.
“Investors view it as a relatively affordable market with limited downside risk and considerable potential.”
See latest Adelaide office assets available on Commercial Ready here.
Positioning for the Next Phase
With the pipeline of new supply diminishing, Mr Burston said the outlook for prime rental growth is strengthening.
“We are already seeing this in some locations, such as Brisbane and parts of Sydney, and over time we expect the recovery to broaden,” he said.
“That will begin in locations adjacent to core CBDs, such as the Midtown precinct in Sydney and the western core in Melbourne.”
Opportunities would also arise from new transport developments.
“We have seen this in Sydney, and it is coming to Melbourne through the Metro Tunnel and to Brisbane through Cross River Rail,” he said.
“From a cyclical perspective, historically low valuations make this a good time to invest, with further opportunities likely to emerge as infrastructure projects reshape markets.”
