Major co-working space players continue CBD expansion: US-based major co-working space player WeWork has confirmed it will open a new four-level location at 222 Exhibition Street in Melbourne’s CBD. It has signed a 12-year deal over 5,250sqm and will have signage rights to the 29-storey building, which has been refurbished.
Its latest offering is throughout the nine-storey at 401 Collins Street in the CBD, after Impact Investment Group completed its revitalisation of the building, and it also has another Melbourne city site at 114 William Street.
The CBD is also home to the flagship Hub Australia space in the Mail Exchange building, on the corner of Spencer and Bourke Streets, which can cater for up to 700 people. Hub Australia’s third Melbourne facility is the 3,500sqm offering in the Georges building at the city’s east end, which will have room for around 200 small business, and recently revealed plans to open a 2,700sqm facility over the top three levels of Melbourne’s first skyscraper, the 1 Nicholson Street building.
Office market vacancy hits decade low: Melbourne’s broader city office market, meanwhile, has fallen from 4.5% to hit a 10-year low of 3.6% in the first half of 2018, according to the latest Property Council of Australia figures. Net effective rents grew by 7.2% over the past year to hit around $420/sqm, and average incentives are around 26%.
That increase is tipped to continue throughout 2018 with a shortage of stock coming online in the medium-term; of the 450,000 expected to come online in until 2020, 64% is pre-committed.
Disclosure: The weekly Fitzroys Property Wrap is for information only on transactions in the Melbourne property market. Fitzroys provides this information as a public service. We are not purporting that all sales and leases within this report were transacted by Fitzroys.