More Canberra workers could soon be working in the Parliamentary Triangle despite very limited office vacancy rates.
Research from Knight Frank has shown an uptick in development around Barton, which may unlock the tightly held suburb to a wider range of companies.
Overall vacancy rates in Barton were at just 0.5 per cent in the first half of 2024.
But the Knight Frank ACT managing director, Nathan Dunn, said large developments including 15 Sydney Avenue and 23 National Circuit, would free up space in the hot suburb.
But those who have not already expressed interest in new builds may be too late.
Government departments, along with private companies, are eyeing up new builds in the suburb.
In 2022, the Australian Tax Office signed a 15-year, $323.4 million lease, for 15 Sydney Avenue, which will house all Canberra-based staff.
The Department of Foreign Affairs and Trade plans to set up in Barton by consolidating three expiring leases into one at 19 National Circuit from October 2026.
Austrade is also one the hunt for a Barton building for around 250 staffers.
"We have seen a sustained level of demand for prime space from government tenants in particular," Mr Dunn said.
Vacancies rates sat at 5.3 per cent in the triangle as a whole, according to the data, but A-grade offices in the area had just a 1.7 per cent vacancy rate.
That is compared to a 9.5 per cent vacancy rate of A-grade offices in Civic and 9.8 per cent of secondary grade in the same period.
Canberra had the lowest vacancy rate of any Australian capital sitting across the first half of 2024.
A tale of two grades
The data shows that while demand is fierce for A-grade offices across the territory, tenancy rates for older offices are dropping.
In town centres outside Civic, the vacancy rates of secondary offices was 20.3 per cent and move-in incentives were offered on 30.5 per cent of them.
These figures reflect a broader issue in Canberra, as less desirable office blocks are abandoned for A-grade ones, leaving dormant buildings scattered across the territory.
Mr Dunn said a steady development pipeline would likely see more companies move into newer offices, renewing debate about what to do with decaying buildings, in what he described as a "looming two-tier rental market."
"Although new build supply is limited, the few sites that will have soil turned in the next three to five years will have a completely different rent base than existing stock," he said.
