Melbourne’s coworking market has seen a huge boom in the past 12 months and is expected to continue, but not without some changes within the industry.
Colliers International’s tenant advisory director Matt Pedrazzini said that although the term is ‘coworking’, many operators are offering mostly private offices for large occupants waiting for their own offices to complete construction.
This proves the industry is pivoting away from the startup environment that fueled the sector. Now, with many premium spaces already being occupied by major coworking companies, phase two of the trend has commenced. Landlords are looking to renovate smaller B-grade buildings that will include coworking spaces, and big operators such as WeWork are taking over entire buildings.
Dan Baxter, chief executive of coworking firm Victory Offices, said that the sector has become increasingly congested and it is important for new players to set themselves apart as competition tightens.
“A lot of this will be discounted offers and introductory rates, but ultimately I don’t see that as a sustainable strategy, so we’ll probably see some rationalisation in the marketplace as some operators exit,” said Baxter.
