Investment bank UBS has predicted that there will be 15% less people working in CBD offices each day than before the pandemic.
It estimates that a decline in the number of people driving to the CBD for work will impact toll road operator Transurban’s proportional revenue by around $110 million compared to pre-pandemic levels, excluding new tolls road opened after December 2019.
UBS’s forecast decline in the number of people working in CBD offices has also seen it reduce its 2023 office income forecasts for real estate investment trusts Mirvac and Dexus.
“We believe working from home more is a structural shift because the global COVID experience has proven that organisations still function without complete loss of productivity under a hybrid working model, and because many workplaces have updated their flexible work policies to allow more remote work,” a new UBS report says.
The bank, which says pandemic lockdowns proved working from home was “a viable alternative” for office employees, calculated there will be 15 per cent fewer people working in CBD offices each day compared with pre-pandemic days…
A decline in people driving to work will hit Transurban’s proportional revenue (which reflect income from its toll roads) by about $110 million compared with pre-pandemic levels, excluding income from new roads that opened after December 2019, UBS says.
However, Transurban’s ability to raise toll fares in line with inflation, stronger truck traffic and the opening of new toll roads such as Sydney’s new M5 tunnels (which started taking traffic in mid-2020) are expected to lift the company’s total proportional revenue by more than $1 billion to $3.8 billion by fiscal 2024 compared with fiscal 2019, the bank says.
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
