Melbourne CBD’s office market shows signs of stabilisation amid high vacancy, shifting demands
Key points:
- Melbourne CBD’s 2024 vacancy rate remained at 18%, which is the highest since 1997.
- Tenant demand is focused on energy-efficient prime assets, while older stock struggles.
- Only 21% of metro space under construction is pre-committed, signalling tenant caution.
- Premium rents are rising; A-grade rents are falling due to incentives and building outgoings.
- Investment volumes are at a 20-year low, but recovery is projected to emerge by late 2025.
Melbourne’s CBD office market began to show early signs of stabilisation in Q1 2025 after enduring multiple quarters of subdued activity and high vacancy. The demand remains focused on prime-grade and flexible office spaces, while secondary and older stock struggle with weak tenant interest.
Cushman & Wakefield reported that the Melbourne CBD had a net absorption of -44,962 square metres (sqm) in the six months leading to January 2025, a drop from -15,462 sqm in July 2024 due to the removal of 63,412 sqm of office space. A-grade assets accounted for most of these withdrawals, totalling 44,000 sqm, reflecting a market preference for modern office spaces.
Moreover, JLL reported that Australian CBD net absorption reached 163,500 sqm in 2024, the best since 2018, while Melbourne's recovery remained slow. Sublease availability declined across Australia to its lowest since Q2 2020, indicating that businesses have now largely adapted to hybrid working models.
Meanwhile, Urban Property Australia (UPA) noted that Melbourne's CBD vacancy rate held steady at 18.0% as of January 2025—the highest since 1997. Tenant demand remains concentrated in energy-efficient prime buildings as employers seek to create attractive environments that encourage employee return-to-office (RTO) participation.
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14 Best Coworking Spaces in Sydney
Coworking spaces in Sydney are in high demand due to their prime locations and strong networking opportunities. They offer startups, freelancers, and solopreneurs a balance of affordability and flexibility. Here are 14 of the best coworking spaces in Sydney to consider:
1. Regus (Australia) - Located at 201 Sussex Street, Sydney
2. The Great Room (Australia) - Located at 85 Castlereagh Street, Sydney
3. Servcorp (Australia) - Located at 25 Martin Place, Sydney
4. The Executive Centre (Australia) - Located at 1 Bligh Street, Sydney
5. The Work Project (Australia) - Located at 50 Bridge Street, Sydney
6. King Street Studios - Located at 66 King Street, Sydney
7. GPT Space & Co. - Located at 580 George Street, Sydney
8. Fishburners - Located at 11 York Street, Sydney
9. Clarence - Located at 65 York Street, Sydney
10. TRC Group - Located at 1 Castlereagh Street, Sydney
11. Tank Stream Labs - Located at 300 Barangaroo Ave, Sydney
12. Replus Coworking - Located at 68 Pitt Street, Sydney
13. Works By Scentre Group - Located at 100 Market Street, Sydney
14. Lockhart-Krause Architects - Located at 9 Castlereagh Street, Sydney
Coworking spaces in Sydney are redefining the way we work, catering to the needs of freelancers, entrepreneurs, tech and creative professionals, and businesses seeking a dynamic work environment. From the heart of Sydney CBD to the city’s creative suburbs, coworking spaces offer a creative atmosphere with a range of seating options, including hot desks, private offices, and dedicated team spaces.
More than just shared desks, these coworking offices in Sydney serve as community spaces for collaboration and business growth. Many coworking space providers in Sydney offer social perks, including networking events, casual meetups, and even early evening drinks.
Several coworking locations in Sydney from this list go beyond the basics, featuring luxurious amenities such as on-site cafes, gyms, podcast studios, terraces, and sports facilities. These coworking spaces vary in style, from aesthetically inspiring designs to those with breathtaking harbour views.
If you are looking for inspiring interior design or stunning views, this guide to the 14 best coworking spaces in Sydney will help you find a space that supports both your work and personal growth.
12 Best Coworking Spaces in Melbourne
Coworking spaces in Melbourne are in high demand due to their prime locations and strong networking opportunities. They offer startups, freelancers, and solopreneurs a balance of affordability and flexibility. Here are 12 of the best coworking spaces in Melbourne to consider:
1. Regus at 367 Collins Street
2. Spaces at 691 Collins Street
3. Servcorp at 263 William Street
4. JustCo at 276 Flinders Street
5. Christie Spaces at 454 Collins Street
6. Tank Stream Labs at 440 Collins Street
7. Workspace365 at 333 Collins Street
8. WorkHub at 488 Bourke Street
9. 25 King Workspace at 25 King Street
10. The Cluster at 31 Queen Street
11. 11th Space at 568 Collins Street
12. Ewave Global at 365 Collins Street
Melbourne is one of Australia’s top business destinations, attracting freelancers, entrepreneurs, and companies seeking flexible and creative work environments. From hot desks and private suites to event venues and creative studios, these flexible workspaces are designed to boost productivity and inspire connection. You will find options to suit every budget and work style, with locations conveniently spread across the CBD and surrounding suburbs, such as Docklands, Yallambie, Williamstown, Parkville, and Carlton.
This guide highlights 12 of the best coworking spaces in Melbourne and will help you choose the one that best suits your business needs, location preferences, and team goals. Let’s take a closer look at what each space offers.
Sublease or Licence: The Right Thing to Do with Unused Office Spaces
You surely came across this blog to discover answers to your question, “Should I sublease or license my spare office space?”
Subleasing and licencing are two common renting options in the real estate industry. These two conditions give landlords and tenants unique ways to rent their space to the market.
Unsure whether to sublease or license your space? Fret not! We've prepared a simple comparative guide below to help you determine the best option for your office space. Enjoy reading!
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The Importance of Getting Sustainable Office Certifications
Have you noticed the surge in demand for flexible offices across Australia? Coworking spaces and serviced offices are providing businesses with the utmost flexibility and adaptability. But with climate change becoming a bigger part of our daily lives, it's fair to ask: do these spaces have sustainable office certifications?
These certifications are official acknowledgments for buildings designed for sustainability and meeting important environmental, social, and economic standards. In this blog, we'll explain why sustainable certifications are not just nice-to-haves but a must for any flexible office looking to succeed in Australia's growing green market.
Why Startups and Coworking Must Stick Together: 5 Reasons
Growing a startup takes commitment, hard work, and sufficient capital. It also requires a work environment that fosters productivity. To navigate the environmental challenges, this guide dives deep into the reasons “Why startups & coworking must stick together.” Keep reading!
Coworking is a relatively new option for startups, and companies are leveraging this tactic to boost their growth. This particularly applies to tech startups. Thus, the following sections also elaborate on how co-working spaces lead to more innovation for tech startups.
