Melbourne ($468/sqft, 18.4% vacancy) and Sydney ($96/sqft, 12.6% vacancy) compete on different axes: Melbourne on rent and tax and Sydney on talent depth.
Melbourne ($468/sqft, 18.4% vacancy) and Sydney ($96/sqft, 12.6% vacancy) compete on different axes: Melbourne on rent and tax and Sydney on talent depth.
| Metric | Melbourne | Sydney |
|---|---|---|
| Region | APAC | APAC |
| Country | Australia | Australia |
| Class A rent (USD/sqft/yr) | $468 | $96 |
| Class A rent (local) | 720 AUD | 1480 AUD |
| Vacancy | 18.4% | 12.6% |
| Trend | softening | flat |
| Prime yield | 5.4% | 5.5% |
| Premium flex / seat / month (USD) | $720 | $990 |
| Submarkets covered | 5 | 6 |
| Corporate tax | 30% | 30% |
| Metric | Melbourne | Sydney |
|---|---|---|
| Typical term | 7 yrs | 7 yrs |
| Typical rent-free | 14 mos | 30 mos |
| 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. | Standard 5-10 year lease. Gross or net structure (both common). Australian leases distinguish 'face rent' (headline) from 'effective rent' (face minus incentive). Incentives of 30-40% are now standard — typically structured as rent abatement, fit-out">fit-out contribution, or both. |
| Tax note | 30% Australian corporate tax (25% for base rate entities). Victorian state payroll tax of 4.85-6.85%. R&D tax incentive available federally. | Federal corporate tax 30%. NSW payroll tax applies. No state corporate income tax. |
| Metric | Melbourne | Sydney |
|---|---|---|
| Talent index (0–100) | 84 | 85 |
| Talent note | Deep professional services, banking, education, and creative talent. Strong feed from University of Melbourne, Monash, and RMIT. English-fluent professional base; multicultural workforce. | Australia's deepest financial-services, technology, and professional-services talent pool. Average all-in compensation indexes 85. |
Melbourne: 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.
Sydney: Sydney Metro and Sydney Trains converge at Wynyard, Town Hall, and Central. The new Sydney Metro City & Southwest line transformed core CBD commute capacity.
Sydney is the cheaper Class A market on a USD basis.
Sydney has the deeper talent index (85/100 vs 84/100).
Tax rates are tied.
Melbourne typical term is 7 years with 14 months free; Sydney runs 7 years with 30 months free.
Melbourne: 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. Sydney: Sydney Metro and Sydney Trains converge at Wynyard, Town Hall, and Central. The new Sydney Metro City & Southwest line transformed core CBD commute capacity.
Score Melbourne, Sydney and up to two more markets side-by-side on Class A rent, vacancy, talent, corporate tax, and premium flex pricing — all in USD.
Reviewed by Kenji Watanabe — APAC contributing editor. Last updated 2026-04-15. See our methodology and editorial standards.