Canberra’s office vacancy rate has climbed from 10.2 per cent to 14.7 per cent in the past six months, driven by new office space entering the market and falling demand, according to the latest Property Council of Australia Office Market Report.

The sharpest increase was in Civic, where vacancy more than doubled from 12 per cent to 26.4 per cent after negative demand of 116,934 square metres. By contrast, the non-Civic market remained largely stable, with vacancy edging up from 9.4 per cent to 9.6 per cent despite substantial new supply.

More than 52,000 square metres of new office space entered the Canberra market during the period. Vacancy also increased in A-grade offices, from 8.4 per cent to 13.6 per cent, and B-grade offices, from 11 per cent to 19.3 per cent, while C-grade vacancy improved slightly to 13.7 per cent.

Property Council ACT executive director Ashlee Berry said Civic remained the city’s biggest challenge, arguing a strong city centre was essential to supporting investment, employment and retail activity across Canberra. She said the limited pipeline of new office supply over the next 18 months provided an opportunity to improve demand, encourage office attendance and support investment in the CBD.

Only 15,000 square metres of new office space is due to be completed in the second half of 2026, followed by 40,113 square metres in 2027. The Property Council has urged the ACT Government to support Civic’s recovery through planning reform, building renewal and lease variation charge reform.

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