Flexible Office Space Report - Q3 2025

Sydney Flex Market Absorbs New Premium Supply as Rates Hold

Sydney’s flexible office market saw a surge of new, high-quality inventory in Q3, with available space expanding 8.5% to 36,655 sqm. Despite this new supply, the CBD median rate held firm at $1,000/desk, proving the market's strong appetite for premium options.

This trend mirrors the "flight to quality" seen in the wider Sydney office market. With traditional leasing enquiries for premium-grade buildings surging, the flexible market is benefiting from the same momentum. We are seeing a more discerning occupier: businesses are taking longer over their decisions, but they are quick to act when new centres with attractive launch incentives hit the market.

A closer look at team sizes reveals a clear operator strategy of portfolio rebalancing.

• Small & Medium Teams (1-25 desks): This was the clear focus for new supply. Available space for these teams jumped significantly (+16% for 1-4 pax; +14% for 11-15 pax). This massive influx of new options is what held prices steady, as supply rose to meet consistent demand.

• Large Teams (26-50 desks): This segment showed softness. A 14% increase in supply was met with price sensitivity, forcing a rate correction of 8.3% down to $917/desk.

• Enterprise Teams (50+ desks): This segment tells a story of scarcity. Available space contracted 5.9% (and is down a massive 47% year-on-year) as operators carve up larger suites. This drove a 10% price jump to $800/desk for the few large offices remaining.

Beyond the CBD, key hubs provided sharp contrasts in local supply dynamics.

• North Sydney saw the most dramatic change. A massive 36% quarterly and annual drop in available space was almost entirely due to the closure of Christie Spaces's older 100 Walker Street centre, which removed a large volume of secondary stock from the market at once. The fact that rates only rose 1.0% to $628/desk, even with this structural change, points to the underlying stability of the remaining, higher-quality inventory.

• Parramatta experienced a short-term supply shock. New inventory (+21%) entered the market, causing a temporary 9.8% rate dip to $647 as the new space is absorbed.

• Surry Hills demonstrated its resilience as a boutique market. A 19% drop in available space saw rates rise 8.9% to $735/desk.

The story in Sydney is one of smart, measured decision-making. We're seeing tenants take longer to choose, but they act decisively when new, high-quality centres open. The supply contraction in North Sydney and price corrections in Parramatta show that for a Sydney business, location and value are paramount. The flex market is giving them the power to make that choice without locking in long-term risk.

Tom Petryshen, VP Growth & Analytics

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Source: Rubberdesk Q3, 2025

Flex Supply Grows 9% as Melbourne Rates Hold

Melbourne's Q3 data confirms it's a tenant-led, price-sensitive market—an opportunity businesses will find welcoming. With rate corrections in Docklands and the CBD's mid-market, operators are clearly competing for tenants. This gives businesses the negotiating power to secure a high-quality office on excellent terms, all while retaining the agility essential in this economic climate.

Suzana De Abreu, Account Manager

Reflecting the Melbourne's subdued business conditions and Australia's most challenged office market, Melbourne’s flexible spaces are showing clear signs of a tenant-led, price-sensitive environment.

On the surface, the CBD market saw a modest 2.0% lift in median rates to $725, alongside a 2.9% rise in available space (to 24,300 sqm). However, this headline rate is misleading. It masks significant softness in the mid-market and was driven almost entirely by a 2.1% rate rise in the high-volume 1-4 desk segment.

In contrast, tenant negotiating power was clearly felt across all larger team sizes. As new inventory was added for 16-25 and 26-50 desk teams, placing downward pressure on rates which fell 3.7% and 9.3% respectively. This signals strong price sensitivity from businesses as they weigh up their options in a market with elevated vacancy.

City fringe locations, popular with creative and tech industries, told a story of premium supply versus over supply.

• Cremorne reinforced its status as the most expensive hub. A massive 74% increase in new, high-end supply pushed the average rate up 3.6% to $950.

• Docklands experienced a severe supply shock. A 133% flood of new inventory (more than doubling the available space) caused a 24% rate correction, with prices falling to $550/desk.

• Richmond absorbed a 12% increase in space while its rate held firm at $669, while South Melbourne and Collingwood also remained stable.

• Collingwood rates remained steady at $542/desk despite 7.0% increase in inventory.

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Source: Rubberdesk Q3, 2025

Brisbane Flex Market Continues to Outperform, Absorbing New Supply with Ease

Reflecting its status as one of Australia's strongest economies, Brisbane's flexible office market showed exceptional strength and depth in Q3. Favourable business conditions and strong population growth fueled demand that easily absorbed a 4.0% quarterly increase in available space (to 10,655 sqm), pushing the Greater Brisbane median rate up 4.1% to $628/desk.

This new inventory was clearly welcome, as it entered a market that remains tight, with available space still down 14% compared to the same time last year.

This underlying strength was most visible in the Brisbane CBD. Mirroring the traditional office market—which has Australia's lowest CBD vacancy rate—demand for flex space was strong. Available space in the CBD contracted by 3.2%, allowing operators to push rates up 2.3% to $649/desk.

Key suburban hubs showed a clear split:

• Fortitude Valley demonstrated the market's incredible depth. A massive 47% surge of new supply was met with such strong demand that operators were still able to increase rates by 3.6% to $518.

• Bowen Hills saw a slight pause, with rates dipping 4.1% to $673 on stable inventory.

Pricing by team size told a dynamic story of where demand is sharpest. Smaller suites (1-4 desks) and mid-sized offices (11-15 desks) were in high demand, with rates jumping 8.2% and 6.4% respectively. The strongest demand, however, was for larger 26-50 desk configurations; with no new supply added, rates for this segment skyrocketed 22.1% to $613.

The only soft spot was the 16-25 desk segment, where a 20% increase in new listings forced a modest 4.4% rate correction.

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Source: Rubberdesk Q3, 2025

Perth's Tightening Market Shines a Light on West Perth's Growth

Perth’s flexible office market is now the nation's tightest, reflecting its 'clear outperformer' status in the Australian economy. While the median CBD rate held firm at its high point of $749/desk, this stability masks the real story: a significant 15.5% quarterly contraction in available space across Greater Perth.

This supply squeeze, driven by strong business conditions, supports the substantial 15% annual price growth seen over the last year.

The CBD remains the premium, highly-centralised core, but its inventory is clearly shrinking. Available space in the CBD declined by 23% in Q3 alone. This tightening supply appears to be drawing more attention to nearby hubs, with West Perth emerging as the key beneficiary.

West Perth is no longer just a "value" alternative; it's a boom market. It successfully absorbed a 13.7% increase in new supply while simultaneously posting a stunning 24.8% quarterly rate jump to $624/desk. This is underpinned by a massive 56.4% price increase year-on-year, confirming its arrival as a primary demand hub.

West Perth posted a notable 25% quarterly rate jump to $624/desk due to new premium supply which jumped 14%. This movement is underpinned by a 56% price increase year-on-year, confirming its growing strength as a value-add alternative to the CBD.

Osborne Park experienced a small price correction, with desk rates falling 4.8% to $428 as a direct result of available supply doubling in the area.

Demand was stable across the high-volume, small-team segments. Rates for 1-4 desks and 5-10 desks both nudged up slightly (0.8% and 0.7% respectively), showing the market is comfortably absorbing these prices at high occupancy.

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Source: Rubberdesk Q3, 2025

Adelaide Flex Market Expands to Meet "Flight to Quality" Demand

Reflecting its status as one of Australia's standout economic performers, Adelaide’s flexible office market saw a significant and healthy expansion in Q3. Available space grew by 45% for the quarter (and is up 207% year-on-year), as new, premium supply from operators like Tank Stream Labs and Creative Cubes finally arrived to meet long-standing demand.

This new inventory was eagerly absorbed by the market, pushing the Greater Adelaide median rate up 5.7% to $634/desk.

This "flight to quality" trend, which has seen the traditional CBD office vacancy rate fall for the third consecutive time, was the clear driver.

The CBD was the epicentre of this growth. A 29% quarterly increase in available space was met with such strong demand that operators pushed median rates up 10% to $645/desk.

North Adelaide saw rates and supply hold steady at $605, while Mawson Lakes' inventory grew 11% with rates remaining at $398, offering a cost-effective alternative.

With 87% of all inventory (under 10 desks) set aside for small teams, tenants will find a variety of available options.

The 1-4 and 5-10 desk segments saw the largest influx of new inventory (space up 56%). Demand for 1-4 pax suites was strong enough to absorb this new supply and lift rates by 8.7% to $589. The 5-10 pax segment absorbed its new inventory perfectly, with rates holding firm at $600.

Though limited, the 11-15 desks segment showed more price sensitivity. A 133% increase in available space (a doubling of options) led to a 16% rate correction, with prices settling at $715/desk.

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Source: Rubberdesk Q3, 2025

Canberra's Flex Market Absorbs 25% Supply Jump

Canberra's flexible office market showed notable growth in Q3, seemingly defying the "wait-and-see" approach affecting the wider commercial market. While public sector uncertainty has led to a stall in traditional leasing, the flex market saw available supply expand 25% to 5,030 sqm.

This new inventory was readily absorbed, allowing median desk rates to climb 8.0% to $540.

The Canberra CBD absorbed significant new inventory, with rates rising 4.0% to $615 per desk as available space expanded 43%. This marks a return to activity in the capital's central office market after a quiet period.

Suburban markets, which offer cost-effective alternatives, maintained stable pricing. Key hubs like Belconnen and Kingston both held at $540 per desk while Dickson and Symonston also remained steady at $500 and $450, respectively, providing solid, affordable options.

The market continues to favor smaller occupiers, though pricing trends varied by team size. Compact suites (1-4 desks) rose 8% to $540, while 5-10 desk spaces held steady at $518. Mid-sized options (11-15 desks) jumped 26% to $630 as available space more than doubled.

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Source: Rubberdesk Q3, 2025