The supply picture
New office supply in Sydney has fallen sharply — approvals are down sharply (-34% year-on-year). A shrinking pipeline puts a floor under well-located, well-let stock even where headline vacancy looks high: little new product is coming to compete.
Precinct by precinct
Across 221 Sydney office precincts, the current tilt is 66 tightening · 45 demand-led · 76 quiet · 34 oversupply risk (median supply change -46% year-on-year). This is a stock-picker's market: the pressure is uneven, not uniform.
Tightening / demand-led: Paddington - Moore Park, Sydney (North) - Millers Point, Mosman - North, Neutral Bay - Kirribilli
Watch (oversupply risk): Box Hill - Nelson, Erskine Park, Condell Park, Camden - Ellis Lane
The sector backdrop
Valuations lag rates — capital softening still to come; income cushions it. Office cap rates sit around 6.32% on our national read. Conditions are neutral / transitional on our macro read.
Cap rate = the yearly income as a share of price (a higher number is cheaper). The number above is a market read; where our model puts fair value, and the five-year return forecast, are in the report.
The full Sydney office read
Fair-value cap rate, the five-year total-return forecast and the downside range — plus the precinct data in full — sit in the Sydney Office report, refreshed every edition.
See the report →Source: ABS building approvals (supply), MPLC precinct model to SA2 (demand tilt), RBA (rates, yields) and the MPLC valuation model. As at September 2026. Information & forecasts only — not advice.