| Study Period | 2020 - 2030 |
| Base Year For Estimation | 2024 |
| Forecast Data Period | 2025 - 2030 |
| Market Size (2025) | USD 1.29 Billion |
| Market Size (2030) | USD 1.89 Billion |
| CAGR (2025 - 2030) | 7.84 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Australia Flexible Office Space Market Analysis
The Australia Flexible Office Space Market size is estimated at USD 1.29 billion in 2025, and is expected to reach USD 1.89 billion by 2030, at a CAGR of 7.84% during the forecast period (2025-2030).
- Australia's flexible office space market is witnessing a notable transformation, driven by a surge in demand for versatile workspaces. As hybrid work models gain traction, businesses increasingly turn to flexible office solutions tailored to diverse employee needs.
- Take Sydney, where desk rates for compact office setups have surged to around USD 1,000, underscoring a robust demand in sought-after locales. Meanwhile, in Melbourne, desk rates for larger enterprise configurations have dipped by roughly 10%, settling at USD 665. This decline is attributed to heightened competition, with traditional landlords now offering fitted suites, as highlighted by industry associations.
- Amid economic challenges and a wary business landscape, we noted a mean reversion in both the three-month rolling average desk rates and the amount of vacant office space. While median office costs have seen a quarter-on-quarter uptick of 1.2%, they appear to be stabilizing around the USD 667 mark, according to the Australian Flexible Office Space Report Q3, 2024.
- Despite the optimistic growth trajectory, the flexible office space market grapples with challenges, including oversupply in certain regions and variable vacancy rates. For instance, in Melbourne, desk rates adjusted downwards by 2.4% to AUD 725 (USD 453.13), pressured by market-wide vacancies. Conversely, Sydney's CBD desk rates experienced a 7% uptick, reaching AUD 1,000 (USD 625), with premium locales like Barangaroo commanding even higher rates of AUD 1,301 (USD 813.13). In response to these dynamics, operators are bolstering their offerings, integrating upscale amenities and tech-driven solutions to elevate user experiences.
- Desk rates for smaller offices, catering to fewer than five individuals, have continued their upward trajectory, now peaking at USD 665 per desk. This surge reflects operators' strategic pivot, reconfiguring larger spaces into more compact units to align with market demand. On the flip side, rates for expansive team spaces accommodating 50 or more have seen a slight retreat, dipping 1% to 724 per desk.
- However, the expansion of flexible office spaces isn't without its challenges. As traditional landlords introduce their own flexible offerings, they face the intricate maze of zoning laws and building codes. Industry stakeholders are pushing for clearer regulations to foster the growth of flexible workspaces. Moreover, collaborative dialogues between flexible office operators and local governments are paramount, ensuring that these evolving workspace models flourish within established frameworks while addressing community needs.
Australia Flexible Office Space Market Trends
Demand for Larger Spaces driving the market
Australia consistently ranks among the top countries for demand in IT skills, encompassing areas like software development, cybersecurity, and data analysis. As the IT sector in Australia expands, so does the appetite for flexible office spaces. For example, as of May 2024, Worlds Visa Career Abroad reported job vacancies in New South Wales (NSW) at 10,500, followed by Victoria (VIC) with 9,200, Queensland (QLD) at 7,800, and Western Australia (WA) with 4,600. These surging job vacancies significantly influence the flexible office space market, as businesses seek adaptable work environments to accommodate their growing workforce.
Digitalization not only enhances competitiveness but also boosts revenue, fosters product innovations, and generates new job opportunities. In recognition of this, the Australian government introduced the Small Business Digital Champions initiative, aimed at helping small businesses engage digitally. Such initiatives bolster the IT sector, further amplifying the demand for flexible office spaces, as companies prioritize modern, scalable office solutions to support their operations.
In conclusion, the rapid growth of Australia's IT sector, coupled with government initiatives promoting digital engagement, is driving the expansion of the flexible office space market. This trend is expected to continue as businesses increasingly adopt flexible workspaces to meet the evolving needs of their workforce.
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Market Thrives Amid Rising Demand for CBD Offices
Industry associations report that while leasing demand in Melbourne's Central Business District (CBD) has seen a moderate uptick, net absorption has taken a hit. Over the past six months, net absorption recorded a decline of 15,435 square meters. However, this downturn was somewhat cushioned by a robust demand for premium-grade flexible office spaces, which saw a positive absorption of 2,116 square meters. In Q2 2024, notable completions included the Melbourne Quarter Tower in Docklands, spanning 69,000 square meters, and boasting a commendable 40% pre-commitment rate even before its practical completion. By the end of the first half of 2024, Melbourne CBD's vacancy rate stood at 18.0%, marking a 157 basis points rise from the end of 2023.
As tenant preferences sharpen, vacancies are increasingly diverging across precincts. Most precincts are witnessing a rise in prime net face rents for flexible office spaces. In Q2 2024, incentives stabilized, leading to a positive uptick in prime effective rents. However, flexible office space sales in Melbourne's CBD were tepid, with transactions totaling USD 121 million. Yields across Melbourne saw a moderate expansion, influenced in part by recent market deals.
As per reports by Property Council of Australia, Brisbane's CBD, on the other hand, is experiencing a renaissance in the flexible office space market. The office vacancy rate has plummeted to its lowest since 2013, and projections suggest this tightening trend will persist. From January to July 2024, the vacancy rate in Brisbane's CBD nosedived from 11.7% to 9.5%. This significant drop can be attributed to a robust demand for flexible office spaces, evidenced by a net absorption of 26,552 square meters, coupled with 40,338 square meters of office stock being pulled from the market.
In conclusion, the demand for flexible office spaces in Australia's CBDs, particularly in Melbourne and Brisbane, continues to shape the market dynamics. While Melbourne faces challenges with rising vacancy rates, Brisbane's tightening vacancy highlights the growing appeal of flexible office solutions. This trend underscores the evolving preferences of tenants and the increasing importance of adaptability in the office space market.
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Australia Flexible Office Space Industry Overview
The flexible workspace market in Australia is already very fragmented, with 80% of the supply coming from providers outside of the top ten. As more traditional landlords embrace flexible offerings, the range of products continues to expand. The pandemic has shifted their view on flexibility, now seeing it as a vital strategy for competitiveness. Several landlords have partnered with operators, including Hub Australia, Ucommune, and The Work Project, but an increasing number are entering the market on their own. The Loft at South Yarra was just opened by Goldfields Group.
Some of the major players in the market include Servcorp, Flexible Workspace Australia (FWA), Hub Australia, The Commons, and Tank Stream Labs.
Australia Flexible Office Space Market Leaders
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Servcorp
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Flexible Workspace Australia (FWA)
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Hub Australia
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Tank Stream Labs
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The Commons
- *Disclaimer: Major Players sorted in no particular order
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Australia Flexible Office Space Market News
- December 2024: Cyient has opened a new office in Parramatta, New South Wales, Sydney, Australia. This move highlights Cyient's dedication to the Australian flexible office space market, bolstering its stance and augmenting its ability to cater to clients in the connectivity sector.
- August 2024: Embassy REIT, managed by the Embassy Group, has secured a deal with the Commonwealth Bank of Australia (CBA), a leading global bank. This development highlights the growing demand for flexible office spaces in Australia's market. The agreement involves leasing 800,000 square feet of prime office space at Embassy Manyata in Bengaluru, with an option to expand by an additional 600,000 square feet. Embassy REIT is set to complete the facility, including all fit-outs, by the fourth quarter of 2026.
Australia Flexible Office Space Industry Segmentation
Flexible office space is a type of workspace that allows employees to work in several locations and in different ways. In a flexible office space, workers can choose the part of the office that best fits the work they need to do at the time. This is different from most offices, which have fixed desk locations.
The flexible office market in Australia is divided into three sections: type (private offices, co-working spaces, and virtual offices), end user (IT and telecommunications, media and entertainment, retail and consumer goods, and other end users), and city (Sydney, Melbourne, Brisbane, Perth, and Canberra, as well as the rest of Australia).
The report offers market size and forecasts for Australia's flexible office market value (USD billion) for all the above segments. The report also covers the impact of COVID-19 on the market.
| By Type | Private Offices |
| Co-working Spaces | |
| Virtual Offices | |
| By End User | IT and Telecommunications |
| Media and Entertainment | |
| Retail and Consumer Goods | |
| Other End-Users | |
| By City | Sydney |
| Melbourne | |
| Brisbane | |
| Perth | |
| Canberra | |
| Rest of Australia |
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Australia Flexible Office Space Market Research FAQs
How big is the Australia Flexible Office Space Market?
The Australia Flexible Office Space Market size is expected to reach USD 1.29 billion in 2025 and grow at a CAGR of 7.84% to reach USD 1.89 billion by 2030.
What is the current Australia Flexible Office Space Market size?
In 2025, the Australia Flexible Office Space Market size is expected to reach USD 1.29 billion.
Who are the key players in Australia Flexible Office Space Market?
Servcorp, Flexible Workspace Australia (FWA), Hub Australia, Tank Stream Labs and The Commons are the major companies operating in the Australia Flexible Office Space Market.
What years does this Australia Flexible Office Space Market cover, and what was the market size in 2024?
In 2024, the Australia Flexible Office Space Market size was estimated at USD 1.19 billion. The report covers the Australia Flexible Office Space Market historical market size for years: 2020, 2021, 2022, 2023 and 2024. The report also forecasts the Australia Flexible Office Space Market size for years: 2025, 2026, 2027, 2028, 2029 and 2030.
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Australia Flexible Office Space Industry Report
Statistics for the 2025 Australia Flexible Office Space market share, size and revenue growth rate, created by Mordor Intelligence™ Industry Reports. Australia Flexible Office Space analysis includes a market forecast outlook for 2025 to 2030 and historical overview. Get a sample of this industry analysis as a free report PDF download.
