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Australia’s first coworking and hotel club Kafnu set to open, with more sites on the radar

November 28, 2018

Kafnu Alexandria takes up about 3000 square metres in this building, right next to The Grounds of Alexandria. Photo: Alison Cheung

Australia’s first coworking space with integrated hotel accommodation, Kafnu in Sydney’s Alexandria, is set to open in December, but that has not slowed its Singapore-based parent company Next Story Group from hunting for more sites Down Under.

Taking up two levels within a three-storey building in the Dexus-owned 1.9-hectare business estate The Mill, the Kafnu complex at 41-45 Bourke Road will house 16 hotel rooms, coworking spaces, seven meeting rooms and private offices.

Other amenities include a gin and local craft beer bar, a virtual fitness studio, a media production studio, meditation room, phone booths, kitchen area and an events space in the atrium.

Kafnu Alexandria will open in December. Photo: SuppliedKafnu Alexandria will open in December. Photo: Supplied

The opening of Kafnu comes at a time when competition in the space is ramping up – especially in Sydney and Melbourne – with operators increasingly seeing the value of including hospitality elements to set themselves apart from rivals.

The fitout, which has largely been completed, had a $5 million budget, City of Sydney council records show.

Kafnu Alexandria’s general manager Simon Hall told Commercial Real Estate that the company is targeting a different user from other coworking companies.

“We’re not doing just coworking, we’re doing a private members’ club where you can go work in, socialise and collaborate with other members, so we’re not setting ourselves into that space because a slightly different person’s going to join here (compared with someone) who’s going to join just a coworking space, for example,” he said.

“Our structure is very different; you can’t drop in and work, it’s a members’ club.

The events space at the atrium, which was carved out of the second level. Photo: SuppliedThe events space at the atrium, which was carved out of the second level. Photo: Supplied

“What Kafnu’s doing that’s really different to traditional coworking spaces is creating a private members’ club first and foremost that’s for a specific market of the new generation of creators… called hyphenates; these are people with multiple interests, they want to explore, they want to discover, they want to grow themselves.”

Membership rates will cost $750 a month, and $900 will give users access to a dedicated desk.

Next Story is targeting an ambitious portfolio of 50 Kafnu sites in the Asia Pacific by 2021, it announced in October, with three venues currently operating across the region, including Hong Kong, Taipei and Bengaluru.

The group is “looking at establishing more Kafnu properties in key cities in Australia”, Mr Hall said.

Next Story operates 25 hotels and motels across NSW, Victoria, Queensland, South Australia and Western Australia.

One of the facilities include the virtual fitness studio. Photo: SuppliedOne of the facilities include the virtual fitness studio. Photo: Supplied

While all Kafnus have an accommodation component, Mr Hall said the Alexandria building’s proximity to the Sydney Airport reinforced the idea to include hotel rooms.

“For us in this particular Kafnu, because of the location (close to) the airport, we felt that as a business organisation, which really supports corporate travel, having a hotel here next to the airport with Kafnu is an easy fix (for business travellers),” he said.

“Because the backbone of our organisation is hospitality, the more we developed it, the more important the hospitality aspects come in because people always come into the cities (thinking) ‘I need to stay somewhere, work somewhere, meet some people and then I need to get back to my hotel again’.

“We know that we’ll probably fill those (rooms) real quickly because of the convenience of conducting business here and the accessibility to the airport.”

An artist's impression of one of the 16 hotel rooms at Kafnu Alexandria. Picture: SuppliedAn artist’s impression of one of the 16 hotel rooms at Kafnu Alexandria. Picture: Supplied

Including the 18-square-metre rooms within the club “blurs the lines between a hotel and a workspace”.

“(The accommodation at Kafnu Alexandria) has the best elements of a well-appointed boutique hotel with not all the normal, traditional facilities, there’s no tea, coffee (inside the rooms); there’s everything there that you need, but out here there’s everything else and more,” he said.

Rates have yet to be confirmed, but “will be comparable to local hotel and airport hotels”, according to Mr Hall.

And while the original plans included about 30 hotel rooms, the demand for larger workspaces led them to dedicate more space to individual offices, with Kafnu Alexandria’s private-room-to-flexible-workspace ratio at about 4:6, he said.

Kafnu provides two types of club spaces, which include coworking and accommodation, in its network: a larger “hub” which ranges between 5000 and 10,000 square metres and a “spoke”, occupying 2000 to 5000 square metres.

Members are able to access any Kafnu property around the world.

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