Perth's commercial real estate market is stable and performing well, but it would be strengthened by greater population growth in the state, according to Knight Frank’s Managing Director of WA Jeremy Robotham.

He said Western Australia was a desirable place to live from a housing affordability point of view in particular, with employment opportunities another benefit, and if both factors draw more people in over the coming years, Perth’s commercial property market would receive a significant boost.

“Although the residential rental market is very tight, residential capital values can only be described as extremely affordable compared to almost every other major market across the country,” he said.

“Given employment opportunities are also both plentiful and varied, if these two factors can be translated into consistent population growth, all of the commercial property sectors in Perth should also see sound and sustainable growth in performance.

“It was expected that the end of China’s lockdowns at the start of this year would be a boon for West Australian real estate markets, and while that hasn’t fully come to fruition, there are many positives for Perth including the strength of the economy.

“The resources sector is performing very well, as are the international education and tourism sectors, along with agriculture, so most economic cylinders are firing.

“However, the scarce labour market is one factor holding Western Australia back from reaching its full potential growth-wise.

“Once the population in Western Australia starts to really grow, each of the real estate sectors will strengthen further.”

The industrial sector is currently the standout in Perth, in line with most markets around the country, while the office leasing market is showing ongoing signs of improvement, according to Mr Robotham.

“Effective rental growth along with net absorption will continue to be positive, but the rate of growth will be dictated by white collar employment growth,” he said.

Mr Robotham, who was appointed as Knight Frank’s Managing Director of WA earlier this year, said the WA team was preparing to expand in line with expected growth in the Perth market.

To prepare for the growth, the Perth team has moved into a new space – it is still located in the Exchange Tower at 2 The Esplanade, but has relocated from Level 10 to 37.

The new tenancy has views, focus rooms, collaboration rooms and booths, break-out areas, a ‘library zone’, an amazing balcony space and great technology, particularly in terms of audio visual improvements.

The team also has an agile working policy whereby members can sit anywhere they like for the type of work they plan on doing for the day and who they need to work with.

“In the very near term we are looking to grow our Industrial and Valuation teams, and over the course of the next six to 12 months we will also be looking to expand our Capital Markets team and our Asset Management Services business,” Mr Robotham said.

“Our new fitout and way of working will allow us to accommodate this.

“Work is more than a desk, a chair and a laptop – it’s a place to connect, collaborate, learn, focus and enjoy collective success with colleagues.

“We really like the building we are in and its location, but our previous fitout was no longer fit for purpose, so when an opportunity arose to take a new lease and construct a brand new, bespoke fitout which suits the needs of our team, it was definitely not an opportunity to pass on.”