Industry Trends


As outlined in a market research report by industrial research company IBISWorld, the shortage of prime property in resource rich states of Western Australia and Queensland is expected to drive demand for serviced office space.

The article states that, the flexibility of serviced offices has galvanised their position in the office property market. Catering to clients looking for prestigious locations minus the hassle of locking into a 10-year contract.

As corporate activity surged, the dearth of office property vacancies was a boom for industry participants. However, this boom was short lived as the financial crisis swept through the country. As businesses scrambled to salvage their operations, firms scaled down their workforce and delayed projects. Across Australia, as tens of thousands of Australian workers were made redundant, the need for additional floor space declined dramatically.

The drop in revenue in 2007-08 and 2008-09 resulted in 0.9% annualised growth over the five years through 2012-13. Compounding the severity of the situation is the high office property vacancy rates in Melbourne and Sydney. As business confidence is expected to remain flat in 2012-13, industry revenue is projected to grow 2.2% in 2012-13 from the previous year to $520.3 million.

As economic growth is expected to return to historical trends, IBISWorld forecasts that industry revenue will grow an annualised 4.7% to $656 million. The shortage of prime property in resource rich states of Western Australia and Queensland is expected to drive demand for serviced office space; however, the elevated number of vacancies in Melbourne and Sydney will depress overall industry revenue growth. Thus, in 2013-14 industry revenue is only forecast to grow 3.2%. Beyond this, technological developments and changing workplace cultures are anticipated to enhance demand for mobile workplaces. As more corporations move towards increasing workforce flexibility, industry participants are best positioned to offer such solutions.

Read more about IBISWorld‘s findings


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