Canberra had one of the highest rises in central business district office vacancy rates nationally over the last six months, prompting calls for public servants to return to office.
The Property Council of Australia's latest office market report shows Canberra had about a 1.2 per cent rise in vacancies between February and July 2024.
This was beaten only by Melbourne CBD, Victoria's Southbank and NSW's Chatswood.
The Canberra office vacancy rate was sitting at 9.5 per cent in July, compared with 8.3 per cent in January, according to the Property Council.
The historical average of office vacancy rates in Canberra is 7.6 per cent.
The territory's CBD sublease vacancy also grew to just shy of 10,000 square metres, just topping January vacancy rates.
The Property Council ACT acting executive director, Katie Stevenson, said the uptick was worrying for Canberra's economy.
"The CBD is the engine of Canberra's economy, with the greatest concentration of jobs, education and social infrastructure, and we need it to be vibrant and attractive every day of the week.
"But that engine has been running in low gear since the pandemic, and office vacancy rates continue to increase, impacting the appeal of the city centre," she said.
Canberra is tipped to be among the areas with the highest supply of new offices in 2025, according to the Property Council. It is one of only three CBDs with projected new supply in 2026.
"These numbers underline the need to show leadership and encourage more employees - especially those in the public service - to return to the office as part of a balanced working week," Ms Stevenson said.
Most federal public service departments have a flexible work model that includes working from home and the office.
About 22 per cent of public service employees nationwide worked from home some of the time prior to the pandemic, according to the Australian Public Service Commission.
That number rose to 69 per cent - excluding Services Australia where most employees where required in office for operational reasons - during the pandemic.
After a push to return to office in 2022, APS agencies enshrined a commitment to value flexible work in their enterprise agreements from earlier in 2024.
A removal of caps on the number of days employees are permitted to work from home or remotely, kicked in during March.
There are caveats though, with agency heads allowed to reject flexible work requests on the basis of reasonable business grounds.
