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A Flexible Perspective: Co-Working in Australian Office Markets

Colliers International launches survey of Australian landlords and the impact of co-working

Colliers International has released their inaugural survey of investor and leasing clients to gauge the impact of the co-working juggernaut that continues to roll through Australia’s major office markets.

“In many ways, co-working groups have chosen an opportune time to expand rapidly in Australia, as consistent low office vacancy in Sydney and Melbourne coupled with strong white collar employment growth has created a ready market of office-based workers needing a workpoint,” Simon Hunt, Colliers International Managing Director of Office Leasing, said.

“Add to that the growing requirement from corporates to have flexible expansion and contraction options, as well as an ongoing trend for office space that more reflects the needs of a younger cohort of workers, and co-working groups have found themselves a wide gap in the market waiting to be filled.”

Anneke Thompson, Colliers International National Director of Research, said while the occupier side of office markets was evolving rapidly, a concurrent change in the way most purchasers invested in office buildings had yet to be felt to anywhere near the same extent. 

“It is true that while new market entrants from all points of the globe continue to enter Australian office markets, the underlying attraction of the assets they purchase remains unchanged from years’ past – long term, fixed growth income streams from strong covenants in large, secure markets,” Ms Thompson said. 

“When compared to major office markets such as Manhattan and London, co-working groups occupy a small percentage of office space in Sydney, Melbourne and Brisbane. 

“However, they continue to grow faster than most other occupier groups and will be a growing force in the pre-commitment market, which is a traditional source of investment stock for major office investors.”

Colliers International have sought out the opinions of some of the market’s leading office owners and investors to gather their overarching views of the market and to understand how they expect co-working groups will impact occupier and investment markets going forward. 

Overall, the majority of both leasing and investor clients believe co-working has a positive impact on their business/portfolio. In total, 77% of investor clients ‘strongly agree’ or ‘agree’ that co-working groups have a positive impact on their Australian investment portfolio. 

No respondents chose to ‘disagree’ or ‘strongly disagree’ with this statement, and only 23% believe the impact is ‘neutral’. A smaller majority (65%) of leasing respondents ‘strongly agree’ or ‘agree’ that co-working has a positive impact on their business, while 25% chose ‘neutral’ and 10% chose ‘disagree’ or ‘strongly disagree’.”

“In our view, this slightly less positive response from leasing clients perhaps is likely to reflect their reality of managing the impact of co-working groups on their assets and overall building/tenant management,” Mr Hunt said. 

Leasing landlord clients were more positive on the impact of co-working groups on the market, than on their own business. Most agreed that co-working was positive for the market (90%), although a smaller proportion (65%) believe co-working is positive for their business.

“These answers are relatively unsurprising given the infancy of the co-working industry in Australia. However, we see great potential for co-working groups to work with landlords to ensure positive experiences into the future,” Mr Hunt said. “This is most important in Sydney and Melbourne, where space opportunities are few and far between, and co-working groups are competing with traditional tenants for limited space.

“We see a significant opportunity for co-working groups to communicate their business plans more closely with building owners, which may help more owners change their view to see co-working groups as more of ‘a partner’ as opposed to a “normal” tenant or a competitor.”

62% of investor landlords surveyed believed the inclusion of a co-working tenant had ‘no impact’ on the end value of a building. 

“While there appears to be some uncertainty as to a co-working group as a tenant covenant, there is
less concern with the valuation impact,” Dwight Hillier, Colliers International Managing Director of Valuations, said. 

“There appears to still be some uncertainty amongst the investor community as to the strength of a co-working covenant, although encouragingly a strong proportion of investors are as comfortable with co-working groups as a tenant as they are with any other industry type.”

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Simon Hunt

Managing Director | Office Leasing

Office Leasing

Melbourne CBD

As the Managing Director of the Office Leasing Division my team includes over 100 staff and more than 75 leasing operatives across every State and Territory. I have been with Colliers International for 25 years, joining the Office Leasing team in 1993 and worked my way up to Managing Director in 2005.  Along with managing the Office Leasing National Team I hold a number of senior positions within Colliers including a member of the ANZ Executive, Executive Leadership Team and Senior Leadership Team.  I am a Licenced Estate Agent and a member of the Real Estate Institute of Victoria, Property council of Australia and RICS - Royal Institute of Chartered Surveyor.

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Dwight Hillier

Managing Director | Valuation & Advisory Services, Strategic Advisory & Healthcare & Retirement Living

Valuation & Advisory Services

Sydney CBD

I am responsible for the oversight and management of Valuation & Advisory Services; Strategic Advisory & Healthcare & Retirement Living  businesses in Australia.  Ensuring Colliers remains best in class providers in their respective markets. These key sectors on a national basis are headed by the following people:

Jonathan Petsalis - Head of Office | Valuation & Advisory Services
Simon Andreatta – Head of Industrial | Valuation & Advisory Services
Andrew Johnston – Head of Retail | Valuation & Advisory Services
John Harrison - Head of Agribusiness | Valuation & Advisory Services
Phil Western - National Director | Government Property Services
Neil Murray - Head of Strategic Advisory
Shalain Singh - Head of Healthcare & Retirement Living

Colliers  is a full service provider of Global Valuation & Advisory Services.

Managing Director, Valuation & Advisory Services 2013 - Present
National Director, CBD Commercial Valuation, Sydney CBD Office 2006 - 2013
State Director, Consultancy and Valuation, Sydney CBD Office 2003 - 2006
Associate Director, Sydney CBD Office 2002 - 2003
Senior Valuer, Sydney CBD Office 1998 - 1999
Valuer, Sydney West Office 1995 – 1998


Some of the more prominent clients that I regularly undertake national valuation appointments from include The GPT Group, AMP Capital Investors, DEXUS, Brookfield, and Lendlease.

Some of my more recent valuation instructions of Premium and A grade commercial office assets undertaken are as follows:-

‘Governor Phillip’ & ‘Governor Macquarie Towers’, 1 Farrer Place, Sydney
‘RBS Tower @ Aurora Place’, 88 Phillip Street, Sydney
‘Darling Park’, 201 Sussex Street, Sydney
‘Grosvenor Place’, 225 George Street, Sydney
1 Bligh Street, Sydney
120 Collins Street, Melbourne
530 Collins Street, Melbourne
8 Exhibition Street, Melbourne
‘Bourke Place’, 600 Bourke Street, Melbourne
One One One Eagle Street, Brisbane
1 William Street, Brisbane
Central Plaza I, II & III, Brisbane
‘Bankwest Tower’, 108 St Georges Terrace, Perth
‘Brookfield Place', 125 St Georges Terrace, Perth
‘Ernst & Young Centre’, 12 Mounts Bay Road, Perth


Prior to joining Colliers International, I worked within the Research Department of the Property Council of Australia (PCA), then with a boutique firm of Valuers & Land Economists, where I was involved in the valuation of residential property predominantly for first mortgage security purposes, as well as commercial and retail rental advice.

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