The State of Commercial Office Leasing

What Industry Professionals Really Think About Tenant Demands and Workplace Strategy

Insights from the Commercial Real Estate Future Thinkers Night- A PMG Group and CBRE Partnership

The commercial office market is experiencing unprecedented change as businesses navigate evolving tenant office demands and reimagine their workplace strategies. To understand the current landscape, we surveyed commercial real estate professionals at the recent Future Thinkers Night, capturing insights from leasing agents, property managers, tenant representatives, and investment managers across the industry.

The results reveal a market where budget constraints dominate decision-making, collaborative workspace design drives tenant attraction, and flexible leasing terms are reshaping commercial office leasing agreements.

Budget Constraints: The Primary Driver of Office Decisions

Perhaps the most striking finding is that 51% of professionals identify budget constraints as the biggest challenge their clients face. This overwhelming response highlights how cost considerations are fundamentally reshaping tenant office demands and commercial office leasing negotiations.

The financial pressure extends beyond simple rental costs. As one senior analyst noted, clients are experiencing “budget and time” pressures that compound decision-making complexity. This budget-first mentality is forcing tenants to be more strategic about their workplace strategy, prioritising value over premium features.

An additional 36% of respondents cited internal decision-making delays as a significant challenge, suggesting that budget-conscious tenants are taking longer to commit to office space decisions, creating a ripple effect throughout the commercial leasing process.

Workplace Design: Collaboration Drives Tenant Attraction

When it comes to what attracts tenants in today’s market, 38% of professionals point to space provision, specifically collaborative zones and meeting rooms, as the most sought-after design feature. This finding underscores how workplace strategy has evolved to prioritize spaces that foster innovation and teamwork.

However, the data reveals an interesting tension: while collaborative spaces top the attraction list, 28% of respondents say tenant decisions are “all budget driven,” suggesting that workplace design aspirations often compete with financial realities.

The remaining preferences spread across quality finishes (13%) and building amenities (18%), indicating that while aesthetics and amenities matter, functional workspace design that supports collaboration and productivity remains the primary differentiator.

Bespoke Leasing Terms: The Future of Commercial Office Leasing

Looking ahead, 39% of industry professionals believe bespoke leasing terms will most shape the office market over the next 12 months. This represents a significant shift from standardised commercial office leasing agreements towards customised arrangements that reflect individual tenant office demands.

Sustainability considerations rank second at 23%, with many respondents selecting multiple trends, suggesting that environmental responsibility is increasingly integrated into workplace strategy discussions. The combination of flexible terms and sustainable practices indicates a market moving towards more tenant-centric, values-driven commercial office leasing.

Emerging trends like neurodiversity in workplace design and technology integration received attention from 8% of respondents, signaling growing awareness of inclusive workplace strategy principles.

Deal Timelines: The New Reality of Commercial Leasing

The survey reveals that commercial office leasing deals are taking longer to complete, with 45% of transactions requiring 3-6 months to close, and another 34% extending to 6-12 months. Only 11% of deals close in less than three months, reflecting the more deliberative approach tenants are taking towards office space decisions.

This extended timeline aligns with the budget constraints and decision-making delays identified earlier, suggesting that thorough evaluation of workplace strategy options is becoming standard practice amongst tenants.

Regional Insights: The Brisbane Commercial Office Market

Our survey captured perspectives from across the Brisbane commercial real estate landscape, with strong representation from property managers (37%) and leasing agents (26%), providing a comprehensive view of both landlord and tenant perspectives in the Brisbane commercial office leasing market.

The data reflects the current state of Brisbane’s commercial market, where businesses are reassessing their workplace strategy in response to changing work patterns, economic pressures, and evolving tenant office demands. As one of Australia’s fastest-growing commercial centres, Brisbane’s market dynamics offer valuable insights into broader national trends while reflecting the unique characteristics of Queensland’s capital city market.

Implications for Workplace Strategy and Tenant Advisory

The survey findings highlight several key considerations for businesses developing their workplace strategy:

Financial Pragmatism Rules: With budget constraints dominating tenant concerns, successful workplace strategy must balance aspirational design goals with financial realities. Tenants are seeking value-driven solutions that optimise their investment in commercial office space.

Collaboration-Centric Design: The emphasis on collaborative zones and meeting rooms reinforces the office’s evolution as a space primarily for teamwork and innovation rather than individual work. This trend should inform both tenant office demands and landlord improvement strategies.

Flexibility as Standard: The expectation for bespoke leasing terms suggests that traditional commercial office leasing models are becoming obsolete. Tenants increasingly expect customised arrangements that reflect their specific business needs and workplace strategy.

Extended Decision Cycles: The longer deal timelines require patience from all parties and highlight the importance of providing comprehensive information and analysis to support tenant decision-making throughout the commercial office leasing process.