Shocked to the core: Brisbane CBD fails annual economic health-check
The COVID-19 pandemic and its impact on economic activity has hit the vitality of Brisbane’s central business district hard, according to a detailed report on business conditions in the inner city.
A new report details how the COVID-19 pandemic has affected inner city vitality in Brisbane. (Photo: ABC)
The committee’s third annual Inner City Vitality report paints a grim picture of how the Brisbane CBD has coped with the sharply reduced economic and employment activity caused by the pandemic.
It found that the residential property market in the CBD was “shocked to the core”, with vacancy rates rising from 3.6 per cent in June last year to 12.5 per cent in September this year as the key market in international students dried up.
Prepared for the Committee for Brisbane by consultancy firm Urban Economics, the report crunches several data sets including employment figures, office and residential vacancy rates and public transport passenger numbers to identify trends affecting the growth and character of the CBD and inner suburbs.
Committee for Brisbane chief executive Barton Green said the data in the 2020 report was not unexpected but it was a “reality check” to see a range of findings reported together.
“Overall, in 2020 the vitality of the CBD rated a poor 4.8 out of 10, compared to 6.8 in 2019 and 6.2 in 2018,” Green said.
However, he said the balance of inner-city precincts – Fortitude Valley, Spring Hill, South Brisbane and Woolloongabba – had rated better at 7 out of 10.
“We acknowledge the impacts from COVID-19 and unfortunately, on almost every measure that compared 2020 with data from previous years, our inner city has performed worse,” he said.
The report measured economic health across five themes: commercial and residential real estate, hotel stays, retail activity, higher education and transit.
It found that that, with 2.2 million square metres of office space, the health of that market naturally tended to dominate the CBD’s vitality.
“But the nature and composition of the office space is evolving, with education and health care sectors increasing their representation, and tenancy design, operational practices and leasing strategies suggesting flexibility will be key,” the report said.
Similarly, the CBD’s hotel and short-stay accommodation market had to discover flexibility this year, with many hotels having to switch to promoting “staycation” amid local markets rather than rely on the traditional business traveller.
Another big impact on the way the CBD fared under the pandemic was the rapid decline of international students living and studying in the city.
“There are now more than 150 education businesses registered within the Brisbane CBD, including institutions across undergraduate, postgraduate, English language, executive and workplace training and learning courses and operations, and these numbers continue to grow,” the report said.
“The Brisbane CBD is one of the most ethnically diverse communities in southeast Queensland; only 35 per cent of the population of the CBD was born in Australia in 2016, and a further 31 per cent was born in Asian countries.”
“A significant 25 per cent of those born in Asian countries living in the CBD were Chinese and a further 24 per cent were Korean.”
“This is a significant factor having influenced the sharp rise in vacancy rates in the CBD throughout 2020.”
Green said anecdotal evidence in the months leading up to the report suggested it would be a “tough read”.
“But what the 2020 Vitality Report does is to identify the windows of opportunity for economic recovery and reform,” he said.
“We can clearly see where the challenges are and where the attention is required – including attention from policy makers from all levels of government, attention from landlords and tenants, and attention from consumers.