Melbourne’s vacancy rates are at the lowest we’ve seen in over a decade – there simply aren’t enough offices in Melbourne CBD to keep up with the highly competitive demand for space. In fact, if your organisation is planning a move, you should start looking at least 3 years ahead to ensure you can secure an adequate tenancy. Future buildings and offices are scheduled for completion by 2021, which will supply over 480,000 sqm of new offices in the Melbourne CBD alone, however, be mindful that 72% of spaces currently under construction are already leased.
In the meantime, what happens if you want to upgrade, downsize or change locations now? As a business, manoeuvring through this lack of commercial supply it feels like you have only two options, either wait it out or take what you can get. The current market environment works in the landlord’s favour as a high demand and low supply means that tenancy rents skyrocket, with the rent of A grade building’s increasing by roughly 20%. Even if businesses are financially capable of affording the higher rent prices during this time, it can be difficult to find an office that meets the size, quality and location requirements for your team and company objectives.
The good news, you do have options, here are our top choices for your organisation.
Option 1: Consider a different location. The initial thought when wanting to downsize or upsize is moving to a much better suited office space. But with low vacancy rate and high demand, finding the right space in the CBD that matches your brand and organisations values will be a challenge. This is pushing organisations out into the outer suburbs which are growing to accommodate the commercial CBD shortage. Finding a new office space that matches your values for the interim is an option if your current office space cannot manage your growing team and your employees are not as productive and cannot work functionally. You might have to consider moving the business out into the outer suburbs, to manage the low vacancy rates in the CBD and the higher price of available spaces.
Option 2: Re-designing your current workspace. A redesign can help you avoid additional costs and disruption to your staff during an office move. Re-organising can also create a change of scenery for staff while better utilising the existing space. Hiring a workplace strategist can help identify where the core spaces of the office should be situated and where the teams and neighbourhoods should be placed to increase productivity and functionality for the company, and individual team members.
With the assistance of a workplace strategist, you could potentially re-gain 20-30% of office space that was being utilised ineffectively. If space is at a premium (no one likes being crammed in like sardines after all), a workplace strategist can offer advice like hot desking, where certain days various staff members work from home to create a flexible environment, or relocating a certain department that is not required in the office to a smaller secondary workspace. These options create a temporary fix for growing organisations, allowing you to extend your lease for the short term until future buildings are completed and you can permanently relocate.
Think outside the square and you’ll find there are multiple options you can implement for your business and your team, whatever stage you’re in.
Finding the right office space and designing the right environment to best support your organisational values, and your team, does take time. With the help of experts from workplace strategy, to planning, and construction the perfect solution is just a phone call away even in such a competitive environment.