Melbourne’s CBD will never return to former ‘glory’

Melbourne’s CBD will never return to former ‘glory’

Victorian Premier Daniel Andrews predicts that 40% of workers will never return to Melbourne’s CBD, which has angered business groups and the Opposition:

“I think the days of having 100 per cent of people at their desk 100 per cent of the time, in the CBD and in CBDs in the suburbs or regional cities, I don’t know about that [Premier Andrews said].

“I think that working from home works very well for some people some of the time. We estimate we’re going to finish up with about 60 per cent back.

“I talk to big employers, particularly in the CBD, they’re probably more like the 50 per cent mark”…

The Premier’s comments have been condemned by business groups, who accused him of giving up on a viable back to work plan…

David Southwick, opposition spokesperson for CBD Recovery, called on the government to set better targets to get people back to work.

A new analysis of visitor numbers also suggests that Melbourne’s CBD traffic has gone back nearly two decades:

Fresh analysis by KPMG director of demographics and urban economics Terry Rawnsley shows the number of residents, workers, students and visitors on the streets of central Melbourne are currently at levels below those seen in the mid to early 2000s, and even a relatively successful recovery in the coming months might see the city populated at 2009 levels…

Melbourne’s population in 2009 was 3.85 million, compared to 5.15 million today…

More than one-in-five shops across the City of Melbourne — and two in five in Docklands — are still empty, while CBD office vacancy rates are approaching all-time highs as companies try to offload unused floor space and supply in the market outstrips demand by nearly three-to-one…

Meanwhile, office occupiers in the city are trying to offload 130,000 square metres of unused or unwanted office space on the sublease market…

SGS Economics senior associate Marcia Keegan said the three-day working-from-the-office pattern was a major, and potentially permanent, obstacle to bringing activity back to 2019 levels…

While the pandemic’s costs to CBD businesses have been enormous, these have been offset by economic gains experienced in the suburbs where people live. My anecdotal conversations with local cafes and shops in my area have all shared a similar theme: that business is booming on the back of remote work.

Economic activity hasn’t disappeared because of the pandemic. It has merely spread-out into the suburbs closer to home. This ‘sharing of the wealth’ and decentralisation of economic activity surely is a good thing, as is the elimination of wasteful commutes and the added flexibility provided by work-from-home.

Unconventional Economist
Latest posts by Unconventional Economist (see all)

Source link


Please enter your comment!
Please enter your name here