Good news for Sydney City fringe office spaces

By Kristian Morris

The pandemic fundamentally reshaped the way we work. While remote work became the norm for many, the return to the office is showing signs of differentiation, with a clear divide emerging between prime and secondary office spaces. This trend, coupled with the unique needs of younger generations, is leading to a new trend for city offices versus those on the Sydney city fringe.

A-grade and creative offices are thriving

Prime office spaces, also often referred to as A-grade, are experiencing a resurgence. These buildings boast modern amenities, flexible layouts and desirable locations. Companies occupying these spaces are finding that employees, particularly younger generations, are drawn to the benefits they offer. On the other hand, B-grade and lower-tier office spaces are facing a different reality. The exodus to remote work and a general shift in office space requirements have left these buildings with higher vacancy rates.

Leading the return-to-work charge: Gen Z and Gen Alpha

Interestingly, it’s Gen Z and the newbies, Gen Alpha, who are driving the return to offices. Unlike Millennials, Gen X and Boomers who have been more reluctant to embrace a full-time return to the office, these younger generations are seeking a different experience. They crave the benefits of collaboration, technology integration and in-person mentorship that a well-designed office fosters..

Promotion and collaboration

True or not, there’s a perception among younger workers that career advancement is more likely in a traditional office environment. The ability to learn from senior colleagues and build relationships with team members is seen as crucial for professional development. As well (as we see often in bought or leased spaces on the Sydney city fringe) the creative industries, a natural fit for Gen Z and Alpha, often thrive on collaboration and brainstorming. Fields like architecture, graphic design, advertising, and video production are best nurtured in a space that sparks innovation and allows for fluid communication. Importantly, although the percentage of couples who meet at work (10%) is down from 1990s levels (19%), social engagement at the office continues to be a major drawcard for younger people.

Sydney City Fringe offices

Sydney’s city fringe is proving to be a sweet spot for these Gen Z and Alpha professionals. Fringe offices are more likely to be examples of adaptive reuse, with heritage buildings sensitively redesigned to incorporate modern amenities while retaining their architectural charm and period features. These curated adaptations offer joyful work environments that suit younger creative workers.

Transport, technology, comfort and community

The ideal office space for Gen Z and Alpha goes beyond aesthetics. Proximity to public transport is a must as many of these young people will never own a vehicle in their lifetime. They will demand integrated technology. Remember, these generations have not known a world without internet. They seek seamless connectivity, access to cutting-edge tools and collaborative spaces. Comfort is key. Ergonomic furniture, natural light and access to relaxation areas all contribute to a more positive work experience. End-of-trip facilities are a bonus. Finally, a strong sense of community is crucial. Offices that enable interaction and collaboration through well-designed common areas, social events and employee wellness programs are more likely to attract and retain young talent.

What is the future of Sydney city and city fringe offices?

While the return to the office is gaining traction, particularly among younger generations, it’s unlikely to be a full-time return to offices for all age groups. For the foreseeable future, the most likely scenario seems to be a mix of remote work and in-office collaboration. Employees can benefit from the flexibility of remote work while also enjoying the advantages of a well-designed and stimulating office environment. However, for those roles that don’t require collaboration – logistics, accounting and so on – employers will find it more challenging to encourage these workers back to the office. Especially for Boomers, a cheese plate and some drinks on Friday won’t cut it.

In 2024, we need to accept that occupancy rates of Sydney CBD offices might not return to 2019 levels for some years. However, by considering the needs of younger professionals – proximity to public transport, technology integration, collaborative spaces and a sense of community – offices can thrive. The Sydney city fringe, with its abundance of characterful, adaptive-reuse spaces, is perfectly positioned to become a hub for these young, creative minds, shaping the future of the city office.

Case studies

124-126 Parramatta Road & 8 Tideswell Street, Ashfield

The purchasers bought this development site to redevelop, build, and occupy. The space will be a commercial office for their business, and they will supplement their income by leasing space to other tenants who choose to move out of the CBD into Ashfield.

1-7 Probert Street, Camperdown

This warehouse office conversion was sold to an owner-occupier from the Northern Beaches moving business to Sydney City Fringe.

Let us help you with your commercial property

As dedicated local commercial real estate agents, we can help you extract more value from your commercial property. Please get in touch to discuss your circumstances and assets so that we can give you personalised advice. Whether it’s commercial leasing, management or sales, we’re here to help you with your Sydney-based commercial property.

Contact us at Ray White Commercial Sydney City Fringe

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