Sydney is the most expensive city to rent a co-working desk
Sydney’s CBD is the most expensive city in the country for co-working with the median price rising 2.5 per cent in the March quarter to $867 monthly per person for flexible office space, as the demand from returning workers outruns available desks.
Ever volatile, the co-working sector nationally has endured several waves of the pandemic, which initially reduced demand for flexible desk space across the board and then pushed workers towards suburban hubs, closer to home.
Despite a decrease in available office space, median pricing remains relatively low – at $608 per person each month – according to a March quarter report from Rubberdesk, an online flexible office marketplace.
Between April 2020 and March this year, vacancy in the flexible office sector has risen 24 per cent overall – from 132,000 square metres to 167,000 square metres – as a result of the COVID-19 lockdowns.
Prominent players including US giant WeWork and ASX-listed operator Victory Offices have closed facilities over the past year amid the turmoil.
According to Rubberdesk, closures over the last two quarters have resulted in a 9 per cent reduction in available space. Yet, the upheaval has also created an opportunity for some operators to expand their footprints and encouraged new entrants. More than 20 new co-working hubs have opened or are set to open this year.
Among those increasing their footprint are Workspace 365, Hub Australia and The Commons. One of Singapore’s biggest players, The Work Project, is launching into the Australian market through a partnership at Quay Quarter Tower in Sydney.
“As 2021 came to a close, businesses were back on the hunt for office space,” Rubberdesk chief executive Jim Groves said.
“With a number of new co-working centres coming on line in 2022, the stage is set for strong competition from operators to attract tenants with premium offices or heavily discounted rates.”
With lockdowns over, demand for co-working space is again focusing on CBDs, after having shifted towards suburbs, the report notes. Yet despite the broader return by businesses to the office, vacancy in the flexible space sector has remained high, with only a 7 per cent decrease since the start of 2021, according to Rubberdesk.
By March, the Sydney CBD had 376 vacant flexible space offices comprising nearly 35,500 square metres. However, with a 13 per cent decrease in available workstations, the cost to rent space had risen over the quarter. In Melbourne, the price for a monthly office per person has also risen close to 1 per cent to $650.
Prices fell in Canberra, Brisbane, Adelaide and in Perth, whose co-working market experienced the sharpest drop at 7.7 per cent, down to $600.
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