Flexible Office Space Dominates Sydney Office Leasing Market

Flexible and coworking spaces continue to create positive operation as more tenants seek for larger and flexible working areas, specifically in the Sydney CBD. Space providers are noted to offer much larger spaces of 10,000 square meters or more.

Buildings with fitted out suites are affected by this growing market as they opt for alternative to a conventional long-term lease commencement. Strong coworking demand for leases of more than 4,000 square meters is being observed in North Sydney and the CBD. The CBD is particularly targeted as it offers a well-connected location that potentially attracts and retains staff.

 Also, big tech focus on apps and software rather than the “old tech” hardware. These products offer a highly profitable and people-focused businesses. This trend attracted traditional corporate tenants to include more flexible leasing mix.

While flexible office spaces are escalating around the city, overall demand declined marginally over the six months to July. The flagging was mainly perceived in the B, C and D grade office segments. Most of the vacancies resulted from listing withdrawals. Sydney vacancy is noted to have fallen to 3.7 per cent from 4.1 per cent in January. Office rent affordability specifically for the A and premium-grade is noted to have caused tenants to move to fringe areas like Alexandria, Green Square and North Sydney.

Article and image source: https://www.afr.com/property/commerical/flexible-office-space-rises-in-sydney-but-overall-demand-has-dampened-20190730-p52cb3

Ray White’s top 10 listings for July: (Click on the address to view listing)

Part Level 27/264 George Street SYDNEY

Suite 501/60 Pitt Street SYDNEY

Part Level 4/15 Lime Street SYDNEY

Suite 1003/50 Pitt Street SYDNEY

Level 1/26 Sussex Street SYDNEY

Part level 1/71 York Street SYDNEY

Level 4/447 Kent Street SYDNEY

Level 11/97-99 Bathurst Street SYDNEY

Suite 1101/37 York Street SYDNEY

Part level 27/1 Farrer Place SYDNEY