The cost of renting flexible workspace across Sydney has tumbled by about 12 per cent in the past year, as supply continues to surge in the city and major operators slash rates to fill spaces.
The average cost of renting a desk in Sydney has dropped to $725 a month, numbers from The Instant Group show, down from between $800 and $850. While prices remain stronger in Barangaroo and the Sydney CBD at $950 and between $800 and $850 respectively, rates are most affordable in Parramatta, at $500, and Pyrmont, at $600 to $650. The figures are based on completed transactions, rather than rates advertised on listings.
“It’s going to be interesting to watch over the next 12 months as we see new sites open in Sydney from the likes of WeWork, Hub Australia, Compass, JustCo, IWG, etc,” Mr Fleming said.
Growth of flexible office space in the past 12 months has been the sharpest in the Sydney CBD, recording a jump of 24 per cent, followed by North Sydney at 22 per cent.
Mr Fleming said the lower average desk rate of $650 to $700 in North Sydney, compared with the Sydney CBD, had made the area popular for flexible space seekers.
The research also noted an increasing supply of hybrid spaces – a combination of serviced offices and coworking space – which surged by 28 per cent in the past 12 months, while the supply of coworking spaces grew by 18 per cent.
John Preece, chief property officer at Hub Australia, said while the company’s rates had not dropped and were “Very, very positive”, it did not surprise him that the average across Sydney was tracking downwards.