The rise and rise of co-working across Australia has changed the game when it comes to leasing office space.
Powerful landlords, demanding long leases on uninspiring properties, no longer run the show.
Instead, co-working operators, large and small, now offer a range of lease options for businesses of all sizes, from a desk for the day to an entire floor for six months or more.
And research shows it’s as much as 25 per cent cheaper than a traditional lease – as well as infinitely more flexible.
In the know: Questions to ask before you rent a space
How do lease periods for co-working spaces work?
John Preece, the chief property officer for Hub Australia – Australia’s largest Australian-owned and operated co-working provider – says while every operator works differently, all offer a “menu” of options from basic to bespoke, by the day, week, month or longer.
“Co-working operators offer a range of levels, or what we call memberships at Hub Australia, to suit the needs of different businesses, depending on their stage of development,” he says.
“Hub Australia has everything from the very basic level of ‘connect member’, which costs $30 to $50, and essentially buys you access to the site and then it’s a user pays system, where if you use nothing, you pay nothing, or if you want a desk for the day, it’s just $40. This is co-working at its most flexible,” Preece says.
“From there, we have a range of memberships, from the ‘flexible member’ which gives you eight days a month, where you can come in and use a hot desk. You don’t get a dedicated work station, you just pick one that’s free.
“The ‘dedicated desk’ option is for smaller teams or single workers, giving you a space no one else can use, which is paid on a monthly basis.
“We also have ‘private offices’ for teams of up to 20 people and then we can also accommodate up to a 100-person business with a bespoke solution, on an initial fixed term as short as six months,” he says.
Different co-working spaces will offer different packages on leases, but most will include the basics such as your desk space, electricity, internet and that space’s amenities.
Before you sign on the dotted line for a space, make sure you understand what you’re getting for your money, and whether payments are a one-off or a regular subscription.
What are the benefits of co-working spaces?
Preece says growing businesses are drawn to the “sheer flexibility” co-working offers, which allows them to “expand and contract at will”. The benefit to the bottom line is also attractive, he says.
“Traditional landlords require financial security before a business can occupy a building. It can be between eight and 12 months’ worth of rent, which is massive for a small business to find. In a co-working space, you have security and can usually cancel with just one months’ notice,” he says.
Research by Hub, comparing a traditional office lease in Sydney’s CBD with an equivalent space at its newest Sydney location, in Hyde Park, which opened in May, revealed the cost of co-working can be up to 25% lower than traditional office lease.
The comparison took into account the leasing of the physical space, as well as average utilities and common essential services such as cleaning, amenities, and a receptionist.
Top tips: 5 things to know about co-working