Melbourne Class A Office Market

TL;DR

• Trophy product on Collins Street trades at AUD 850-1,050/sqm/year.
• Headline vacancy elevated post-2022 driven by hybrid work and supply.
• Concessions are among the richest in APAC — 30%+ effective discounts common.
• Significant 2024-2026 trophy delivery (Wesley Place 130 Lonsdale, Five Melbourne Quarter).

Overview

Melbourne is Australia's second financial and professional services capital — anchored by deep banking (NAB, ANZ), professional services, and a structurally diverse cultural and education base. CBD trophy stock (Collins Street, Bourke Street) leads the rent stack; Docklands and Southbank provide trophy expansion.

Market snapshot

Composite of Q1 2026 broker market reports for Melbourne.

Lease norms

Net leases. 7-10 year terms standard. Incentives of 30-45% (combination of free rent, fitout, and rent abatement) typical on a 10-year Class A deal.

Transit & access

Metro Trains (suburban rail), Yarra Trams (the world's largest tram network), and bus. Melbourne Metro Tunnel opens 2025 — adds five new stations under the CBD.

Tax

30% Australian corporate tax (25% for base rate entities). Victorian state payroll tax of 4.85-6.85%. R&D tax incentive available federally.

Talent

Deep professional services, banking, education, and creative talent. Strong feed from University of Melbourne, Monash, and RMIT. English-fluent professional base; multicultural workforce.

Notable Class A buildings

• Rialto Towers · CBD West — Iconic blue-glass twin trophy; once Melbourne's tallest.
• Bourke Place · CBD West — BHP-anchored Bourke Street trophy.
• 120 Collins Street · CBD East — Collins Street boutique trophy with Hoyts and EY anchorage.
• Wesley Place 130 Lonsdale · CBD North — Speculative Charter Hall trophy adjoining Wesley Church.
• Melbourne Quarter Tower · Docklands — Lendlease-developed waterfront trophy at Collins Wharf.

Class A submarkets in Melbourne

• CBD East (Collins Street) — Trophy financial and legal spine. (trophy)
• CBD West (Spencer Street) — Established trophy with rail anchor. (trophy)
• Docklands — Trophy waterfront expansion. (prime)
• Southbank — Mixed-use trophy across the Yarra. (prime)
• Parkville & CBD North — Life sciences and university adjacency. (prime)

Melbourne deep-dives

• Rents and incentives — What does Class A rent cost and what concessions are typical?
• Sublease market — How deep is sublease">sublease availability and how does it price?
• ESG and LEED stock — How much certified stock exists and what premium does it command?
• Transit and commute — Which submarkets have the strongest transit access?
• Talent and salaries — What does the white-collar talent pool look like and how is it priced?
• Fit-out costs — What does a Class A fit-out">fit-out cost per square foot?
• Flex vs lease — When does premium coworking beat a traditional lease?
• Taxes and incentives — What corporate, occupancy, and property taxes apply?
• Neighborhoods overview — Which Class A submarkets exist and how do they compare?
• Notable buildings — Which trophy assets define the market?
• Class A vs Class B — What is the spread between Class A and Class B and why?
• Leasing conventions — What lease structures, terms, and concessions are normal?
• Expansion checklist — What is the operational checklist for opening here?
• Relocation guide — How do you move into this market from another city?
• Frequently asked questions — Quick answers to the questions occupiers ask most.
• Operating expenses — What service charges, OpEx, and pass-throughs apply on top of rent?
• Growth and availability — How tight is current availability and what does the pipeline look like?
• Sustainability pathways — How do tenants land net-zero or science-based-target leases here?
• Hybrid work policy — How are hybrid policies shaping office demand here?
• Security and redundancy — What security, power, and connectivity redundancy are standard?
• Lab and R&D space — What does R&D-grade or wet-lab space look like in this market?
• Brand experience — How do trophy buildings function as brand experiences and showpieces?
• Fund strategy and flag — Which submarkets carry the strongest investor flag for funds?
• Exit and renewal — How do you handle a Class A renewal or exit cleanly here?
• Market cycle position — Where is this Class A market in its cycle right now?

Melbourne — frequently compared

• Melbourne vs Bangalore — APAC HQ shortlist: Bangalore vs Melbourne.
• Melbourne vs Hong Kong — APAC HQ shortlist: Hong Kong vs Melbourne.
• Melbourne vs Mumbai — APAC HQ shortlist: Melbourne vs Mumbai.
• Melbourne vs Seoul — APAC HQ shortlist: Melbourne vs Seoul.
• Melbourne vs Shanghai — APAC HQ shortlist: Melbourne vs Shanghai.
• Melbourne vs Singapore — APAC HQ shortlist: Melbourne vs Singapore.

Frequently asked questions

How material are concession packages?

Material. Effective concession packages of 30-45% (combining free rent, fitout, and rent abatement) are standard on long-term Class A deals.

What is the Melbourne Metro Tunnel impact?

The Metro Tunnel opens 2025 with five new underground CBD stations — materially expanding rapid-transit access to the CBD core and Parkville (university and life sciences).

How does Melbourne compare to Sydney?

Melbourne trophy rents trade 25-30% below Sydney; CBD vacancy is higher; professional services depth is comparable.