The downturn in the mining industry has been blamed for a 23-year high in the office vacancy rate in Perth.
A report by forecasting firm BIS Shrapnel has revealed 22 per cent of office space in the central business district is empty.
That is the highest vacancy rate since 1993.
Rents have also collapsed, falling by more than 40 per cent since the peak of demand for office space in 2012.
BIS Shrapnel commercial property project manager Lee Walker said the vacancy rate had not peaked and the downturn had at least two more years to run.
"Demand for office space is closely linked to the resources cycle and we've seen sustained resources investment for close to a decade, but now a number of the projects have come to an end," he said.
"Particularly in iron ore and now in LNG and there are no new projects to replace what is winding up."
Landlords forced to offer rent incentives
Mr Walker said the situation would get worse over the next two years as office space under construction is completed, such as Woodside's 55,000 square metre headquarters in mid-2018.
"On our forecast we don't see any strength of demand for office space for at least the next two years, so there is still a lot of pain ahead for office builders in Perth," he said.
The weak demand for offices has also led to a big drop in rents.
"Since the peak [of the mining boom] in 2012 prime net face rents have fallen by about 20 per cent and net effective rents, which include incentives, have fallen by close to 60 per cent," he said. hong kong office leasing
Net effective rents take into account leasing incentives landlords offer tenants to try to rent office space.
Mr Walker said during the boom, landlords were not offering incentives, but they have been forced to in the current climate.
"It's certainly pretty bad in the Perth office market and we think the downturn is far from over," he said.
"Other commentators are saying we are close to the bottom, but we don't think so. There is at least another couple of years in this downturn to come."