Tech Central destined to pose threat to CBD

An artist’s impression of the new public square at Tech Central, the booming ecosystem set to bring a once-in-a-generation change to Sydney, NSW.

A wave of investment and new developments in inner-city Sydney will pose a major threat to the city’s traditional CBD precincts, as a 25,000-strong workforce of avocado-eating, eBike-riding millennials move into the nation’s upcoming tech corridor.

Tech Central will span six neighbourhoods – including Haymarket, Surry Hills, Ultimo, Redfern, Chippendale and Eveleigh – and sit within a stones throw from three major universities, all within walking distance from the Sydney CBD.

Property developers say while movement is only just beginning, there’s much chatter happening around financial service providers in the CBD who are seeking opportunities to move closer to a well-paid, investment savvy workforce.

Software giant Atlassian, which is planning a new $1.5bn architecturally striking headquarters near Central Station, with the project being guided by the listed Dexus, is leading the charge into the area.

Dexus and Frasers Property Australia are also advancing plans for their $2.5bn Central Place Sydney and Toga is planning a 42-storey tower designed by Bates Smart.

CBRE NSW leasing director Tim Courtnall said business were already looking at ways to service newcomers.

“From an office point of view, some more of the professionals services are asking about the timing, how much space will be available, what the financial metrics look like and asking what government subsidies are available,” he said.

With the arrival of a workforce said to include tens of thousands will be new opportunities for retailers.

Atlassian’s new Sydney Headquarters will be the world’s tallest hybrid timber building. The building is due for completion in 2025.

CBRE’s national director of retail leasing Leif Olson said the southern end of the city’s newest tenants – a group of lifestyle-focused, casually dressed millennials – would help modernise a run-down area.

“I think it’s going to be a fantastic activation of an area of the city that’s been under-utilised for a long period of time. It’ll be great to revitalise that area of the CBD,” he said.

Mr Olson said the economic impact of a well-paid tech workforce would be a godsend for struggling business owners.

“Food and beverage will be the obvious sector that will thrive down in that area, just as it did pre-Covid when we saw a strong night-time economy in Haymarket and Surry Hills,” he said.

Mr Courtnall believes Sydney’s late-night economy, once thriving in Sydney’s Chinatown, Koreantown and Thaitown, will be revitalised, soon extending through Broadway and the several inner-city suburbs that will make-up Tech Central.

Fortress will open one of the largest gaming centres in the southern hemisphere in Sydney.

“There’s going to be a bit of a 24-hour trade happening with late-night opportunities for retailers given our tech workforce is definitely more flexible than other corporations,” he said.

Some developers already have plans in motion.

Just last week Fortius announced its plan to introduce the largest gaming centres in the southern hemisphere to its Central Park shopping mall in Chippendale which will cater for the area’s new residents.

Chief executive Sam Sproats said the centre would extend trading hours as late as 2am and look at other ways to adapt to a changing area as the mall’s first generation of leases come to an end.

Millennials pay a particular focus on work and life balance, a theme that would prove positive for occupancy levels in the area, Mr Olson said.

“People will be out walking, riding and running to work, all of which have a positive effect on retail and residential,” he said.

Mr Courtnall said the new retail opportunities were likely to have flow-on effects for public transport as well as local council investment.

Tech Central Square will become a meeting place for office workers.

Local councils are already looking to pedestrianise further in and around the city. Late last year as when Sydneysiders emerged from lockdown in October, they returned to wider footpaths and more outdoor seating on George St in the CBD. The trend is expected to follow right through surrounding suburbs.

Mr Olson said it appeared that multidimensional entertainment offerings would also prove popular with younger workers.

“Entertainment offering is something we’re seeing expanding in shopping centres, feeding off food and beverage which allowed people to spend several hours there,” he said. “There’s some great groups looking at those entertainment type concepts like mini golf, darts, go karts and escape rooms.”