Melbourne set for pair of major new co-working spaces

WeWork is set to expand its operations across Australia.
WeWork is set to expand its operations across Australia.

The co-working revolution is about to hit Melbourne in an even bigger way as two major operators close in on space for hundreds of desks in the Docklands precinct at new projects being ­undertaken by Lendlease.

Global co-working space operator WeWork is precomitting to take over 5000sqm over three floors at a Collins St complex that will also house the ANZ Banking Group.

WeWork revealed last week its next location will be Brisbane and it expects to grow quickly in Australia after recently opening its first Melbourne office over six floors at the historic London Stores building on the corner of Bourke and Elizabeth streets.

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WeWork managing director for Europe, Australia and Israel Eugen Miropolski told The Australian this month that each of its locations had reached capacity and there was a long waiting list.

The group, which was founded in 2010, is adding between five and 10 locations globally a month and reported this week that it now had 200 buildings.

It operates out of Martin Place in Sydney and the technology hub of Pyrmont.

New York-based WeWork targets technology workers, freelancers and entrepreneurs who rent work space or small offices, and the Dockland site is in keeping with this market.

Since it entered the local ­market in October, WeWork has taken up more than 26,000sqm across five locations in Sydney and Melbourne.

WeWork co-working office

WeWork is taking the co-working market by storm.

Shared office space is one of the fastest-growing segments of the commercial leasing market. But finding the right sites in office markets with low vacancy rates is a challenge.

Lendlease is also working with a rival provider at its new ­Melbourne Quarter precinct. It is in conversations with the Regus-owned Spaces brand to set up a co-working hub in one of the ­towers it is developing although no deal has yet been struck.

The Regus name is on more than 3000 business centres worldwide and it has expanded into top-end precincts such as Sydney’s Martin Place and has flagged plans to have more than 400 sites by 2020. Spaces co-working hubs are well established in Melbourne’s Richmond and Sydney’s Surry Hills.

The ANZ Banking Group ­finalised a major deal last year to occupy 839 Collins St in ­Melbourne’s Victoria Harbour precinct. Lendlease pre-sold the complex for about $430 million.

The building was snapped up by financial services company Challenger and international fund manager Invesco on a tight 5.25% yield, reflecting the rising value of towers in the ­Victoria Harbour district. ­Winning WeWork as a tenant will almost fill the complex.

ANZ has committed to lease 26,500sqm and Lendlease will look to rent out the remaining areas of the 20-level tower offering 38,000sqm of A-grade office space with assistance from ­Colliers International.

– with Elizabeth Redman

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