The last six months have been a testing time, forcing businesses to do the unthinkable…. That is, to trust their whole team to be efficient and productive while working remotely.
Despite the ongoing speculation regarding whether businesses still require a physical office, the team at Growth Australia have found that the opinion of our partners and clients is that the definitive answer is ‘yes, they do!’
Despite the consensus that having a workspace is still relevant, the focus of fitout, office design and construction will take a slightly different direction in light of restrictions and health concerns.
Here is a brief overview of the trends we have seen during the last 6 months in the Brisbane market:
- Tenants have the upper hand.
As the vacancy rates continue to rise, tenants seeking office space now have more influence and bargaining power over landlords and are holding the power when it comes to negotiating improved rental rates and incentive deals when signing new lease.
- A rise in upgrade works with building owners and landlords.
Landlords are embracing the necessity to upgrade their commercial assets in order to attract and retain tenants. With vacancy rates in Australia at an all-time high, the competition to lease commercial space is prevalent. Read more here about the benefits and successful outcomes of refurbishing commercial property and the facilities that potential tenants are looking for: Repositioning Commercial Assets for Market Viability
A rise in sub-lease space on the market
As the COVID-19 crisis rages on, savvy businesses are not just riding the tide, but spending this time to look at the future of their business and assessing their requirements and headcount for the next 12-18 months. This has led to the market being flooded with the release of excess office space for sub-leasing.
“Corporate Australia is the new landlord in town with a sharp increase in sublease availability across the Sydney CBD and Melbourne CBD.,” JLL head of research – Australia Andrew Ballantyne said.
Focus on refurbishment of existing space rather than seeking new premises
It may not seem like so, but it is in fact the ideal time to review your office space and how you use it. With your tenancy empty or with a skeleton staff presence, it makes it more straight forward to undertake any upgrade and refurbishment works without disrupting the team.
Changes to office space-planning
- Growth Australia are lucky to have a healthy pipeline reaching well into 2021 as business owners continue to recognise the benefit in maintaining their office lease. However, the situation has started to affect the key requirements and plans for work environments.
Key office elements in demand are creating zones or areas that teams can choose to complete their task at hand. This not only includes improvements to collaborative spaces and improved technology for virtual meetings, but also the provision of quiet rooms for individual concentrated work. Although many people have adapted well to remote working, focused work will always be more achievable without the distraction of home and family.
Beyond the physical tenancy, landlords are focusing on building upgrades such as end of trip or ‘third space’ facilities to provide showers and changing facilities for those who do not want to use public transport and are favouring walking, running and cycling to work. Read more about landlords upgrading their ‘third space’ facilities for tenants.
Mark Curtin, CBRE’s pacific head of office leasing has said that “the office of the future may be modified to support impromptu collaboration, creative ideation and social connections that are best served in person. It may become a communal hub for training, seminars and career development. In all cases, the office must be equipped with the appropriate technology to effectively connect a more distributed workforce.” All of these considerations will naturally have an impact on office utilization, design, and office footprint.
City fringe properties getting more love
While businesses are still recognising the need for an office for their team, many are considering relocating to outside the main CBD and recognising the benefits of city-fringe properties.
This may be due to analysing the home location of their staff and recognising that the CBD isn’t necessary. These fringe properties will have lower rents of course which may release some budget to create a new fitout that adheres to the necessities and expectations of offices post COVID-19.
To speak to our team about your office leasing and fitout, please get in touch with Tim Russell – 0435 581 161 or tim@growthaustralia.com.au
