Quarterly Report · Q2 2026
Q2 2026 analysis of leasing activity, sales transactions and investment performance across the Greater Sydney office & industrial markets, with sales covering the first half of 2026.
Greater Sydney Settled Transactions & Lease Report · Q2 2026
Office Market — Sales Activity & Investment Performance
State Comparison
H1 2026 Office Sales Activity — State Comparison
| State / Region | Deal Count | Total Sales Volume | Median Price /m² | YoY Price /m² Change | Avg Yield |
|---|---|---|---|---|---|
| Greater Sydney | 393 | $1,463,067,227 | $8,998 | 0.4% | 5.6% |
| Greater Melbourne | 422 | $1,236,969,529 | $5,249 | -12.2% | 6.7% |
| Greater Adelaide | 162 | $345,829,396 | $5,839 | 5.9% | 5.6% |
| Greater Perth | 242 | $350,328,974 | $4,848 | 3.7% | 5.7% |
| Greater SEQ | 324 | $1,910,278,901 | $6,349 | 15.8% | 6.2% |
Greater Sydney’s office market recorded 393 sales totalling $1.46 billion in H1 2026, with the highest median sale rate across the five markets tracked by Arealytics at $8,998/m², up 0.4% year on year. Its average sale yield of 5.6% was also the equal-lowest of the five markets, reflecting strong asset pricing.
Sales by Structure Type
H1 2026 Office Sales Activity by Structure Type
Freehold office sales generated $1.10 billion across 79 transactions, at a median sale rate of $8,331/m², down 11.9% year on year. Strata offices accounted for nearly 80% of transactions, recording 314 sales totalling $366.7 million at a median sale price of $800,000, with median sale rates rising 2.6% to $9,034/m².
Economic Performance
NSW Economic Backdrop, Q2 2026
Employment growth across NSW reached 2.1% year on year, ahead of Queensland (1.2%), South Australia (1.3%) and Victoria (0.6%). Only Western Australia grew faster, at 2.4%.
NSW unemployment fell 40 basis points to 4.0%, the lowest of the five states tracked by Arealytics, while Victoria rose 50 basis points to 5.1% and Queensland 20 basis points to 4.3%.
Around 92,100 additional people were employed across NSW over the year, more than the combined gains in Queensland, Victoria and South Australia.
NSW finished Q2 2026 40 basis points below the national rate of 4.4%, a shift from Q2 2025, when it sat 10 basis points above.
* Source: Australian Bureau of Statistics (ABS)
Arealytics · Q2 2026 Greater Sydney Office Settled Transactions & Lease Report
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Greater Sydney Settled Transactions & Lease Report · Q2 2026
Office Market — Lease Activity & Rate Trends
Lease Rate Trends
Greater Sydney Office Lease Rate Per Square Metre Trends · Net Leases
The median commencing rent fell 15.6% year on year to $700 per m² in Q2 2026, its lowest level in the series since Q1 2023.
The 25th percentile fell 10.3% to $467/m² and the 75th percentile 9.2% to $1,100/m², with the gap between median and upper-quartile rents widening as higher-priced accommodation held its rental levels better.
Lease Structure
Most Common Lease Rate Types and Escalation in Q2 2026 Office Leases
Most Common Lease Rate Types
Percentage of Total
Fixed annual escalations account for 66.4% of leases, rising to 86.3% when combined with fixed and market review arrangements. Annual increases of 4.0% are the most common (33.6%), followed by 3.75% (19.8%) and 3.5% (17.9%). Five-year lease terms remain the most prevalent (21.4%), followed by three-year agreements (14.9%), reflecting a balance between long-term occupancy security and tenant flexibility.
Top Escalation Rates
Percent of Total
Top Lease Terms
Percent of Total
Arealytics · Q2 2026 Greater Sydney Office Settled Transactions & Lease Report
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Greater Sydney Settled Transactions & Lease Report · Q2 2026
Office Market — Suburb Pricing Summary
Suburb Pricing
Pricing Summary for Top Greater Sydney Office Suburbs
Arealytics · Q2 2026 Greater Sydney Office Settled Transactions & Lease Report
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Greater Sydney Settled Transactions & Lease Report · Q2 2026
Industrial Market — Sales Activity & Investment Performance
State Comparison
H1 2026 Industrial Sales Activity — State Comparison
| State | Deal Count | Total Sales Volume | Median Price /m² | YoY Price /m² Change | Avg Yield |
|---|---|---|---|---|---|
| Greater Sydney | 631 | $2,296,122,797 | $6,022 | 2.8% | 4.1% |
| Greater Melbourne | 1,109 | $2,549,756,593 | $3,344 | 1.4% | 4.5% |
| Greater Perth | 348 | $881,260,040 | $3,430 | 13.2% | 4.5% |
| Greater SEQ | 939 | $2,247,608,290 | $4,338 | 3.3% | 4.8% |
| Greater Adelaide | 270 | $750,057,672 | $3,049 | -2.5% | 4.8% |
Greater Sydney continued to command a substantial pricing premium in the industrial sector during H1 2026, with median sale rates sitting 38.8% above Greater SEQ and 80.1% above Greater Melbourne. Despite more modest annual price growth than several competing markets, tighter investment yields suggest buyers remain willing to accept lower returns to secure industrial assets in Sydney’s higher-priced market.
Sales by Structure Type
H1 2026 Industrial Sales Activity by Structure Type
Strata transactions dominated industrial sales activity across Greater Sydney in H1 2026, accounting for 75.6% of deals, while freehold assets generated $1.64 billion in sales volume, more than double the strata total. Strata properties recorded stronger annual price growth of 3.4%, compared with 1.9% for freehold, alongside a higher median sale rate of $6,107/m². Tighter strata yields of 4.0%, against 4.4% for freehold, point to sustained investor demand for smaller industrial assets.
Historical Activity
Greater Sydney Industrial Sales Activity by Quarter
Arealytics · Q2 2026 Greater Sydney Industrial Settled Transactions & Lease Report
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Greater Sydney Settled Transactions & Lease Report · Q2 2026
Industrial Market — Lease Activity & Rate Trends
Lease Rate Trends
Greater Sydney Industrial Lease Rate Per Square Metre Trends
Median commencing rents have risen from $159/m² in Q1 2022 to $250/m² in Q2 2026, an increase of 57.3%. Annual growth has moderated to 2.4%, following the stronger gains of 2022 to 2024. The 25th percentile held at $210/m², matching its year-earlier level, while the 75th percentile eased 3.2% to $300/m², narrowing the spread between them from $100/m² to $90/m², a maturing leasing environment where rental growth is becoming more measured.
Lease Structure
Most Common Lease Rate Types and Escalation in Q2 2026 Industrial Leases
Fixed annual escalations remain the preferred rental review structure across Greater Sydney’s industrial leases, accounting for 51.2% of agreements, while a further 21.0% incorporate the greater of a fixed increase or CPI. Annual increases of 4.0% are the most common (33.6%), followed by 3.0% (20.8%). One-, two- and three-year terms together account for 61.3% of agreements, suggesting tenants are prioritising flexibility while landlords seek consistent rental growth.
Most Common Lease Rate Types
Percentage of Total
Top Escalation Rates
Percent of Total
Top Lease Terms
Percent of Total
Arealytics · Q2 2026 Greater Sydney Industrial Settled Transactions & Lease Report
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Greater Sydney Settled Transactions & Lease Report · Q2 2026
Industrial Market — Regional Pricing Summary
Regional Pricing
Pricing Summary for Top Greater Sydney Industrial Regions · Q2 2026
Across Greater Sydney, industrial median commencing rents varied considerably by region in Q2 2026, with South Sydney recording some of the highest rates at $350/m² for freehold and $394/m² for strata properties. Industrial sale rates followed a similar pattern, with South Sydney achieving the highest median rates of $7,903/m² for freehold and $8,125/m² for strata, reflecting the pricing differences across Sydney’s industrial precincts.
Median sale rate by region ($/m²), Q2 2026
Arealytics · Q2 2026 Greater Sydney Industrial Settled Transactions & Lease Report
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Methodology
To ensure maximum accuracy and coverage, sale and lease transaction data in this Settled Transactions Report incorporates official public and statutory records across Australian jurisdictions as well as other data sources from other direct market participants and data partnerships. Due to standard settlement periods and reporting processing windows, official transactional data is subject to a minimum one-quarter lag. Consequently, Second Quarter (Q2 ending 30 June) figures reflect verified, reconciled data available for publication in October. This structured timeline ensures preliminary or unverified transactions do not distort market trends, providing stakeholders with a complete and reliable analysis.
Important Notice
This report has been prepared by Empirical CRE Pty Ltd ("Arealytics") in partnership with Real Estate Institute of New South Wales ("REINSW") for general information purposes only. It presents a snapshot of Greater Sydney office and industrial market activity for the second quarter of 2026, with sales activity covering the first half of 2026.
The information contained in this report is derived from a range of sources, including publicly available records, third-party data providers and Arealytics' own research. While all reasonable care has been taken in its preparation, Arealytics makes no representation or warranty, express or implied, as to the accuracy, completeness or currency of the information, and accepts no liability for any loss or damage arising from reliance upon it.
The figures presented reflect market conditions as at the date of publication and are subject to revision as further data becomes available. Past performance is not a reliable indicator of future performance.
Nothing in this report constitutes financial, investment, taxation or legal advice, and it should not be relied upon as such. Recipients should obtain independent professional advice before making any decision based on its contents.
The contents of this report remain the intellectual property of Arealytics and intended solely for the named recipient which has requested a copy. It may not be reproduced, distributed or referenced, in whole or in part, without reference to Arealytics.
Prepared By
Misty Belsha
Market Insights & Research Lead misty.belsha@arealytics.com.au
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