Australia: Mid-Sized Flexible Offices See Steepest Price Hike as Coworking Market Matures and Rises In Quality

Flexible office space prices are on the rise in Australia, with the steepest increases seen in mid-sized offices, according to the Flex Futures 2025 report by Flexible Workspace Australia (FWA).

The findings reflect a maturing flex office sector in Australia, marked by regional expansion, price differentiation, and rising expectations for quality and service.

Private offices in coworking spaces designed for 16 to 25 people saw average monthly rates climb from approximately €415 to €472 per person—a 13.7% year-on-year increase. In contrast, prices for larger offices accommodating over 50 people dropped slightly from €452 to €445 per desk, reflecting different demand trends by team size.

This shift, says the study, highlights growing demand from mid-sized businesses and hybrid teams seeking more adaptable workspace solutions outside of traditional long-term leases, says the report. Across Australia, though, per-person rates vary widely depending on cities. Sydney remains the most expensive market, with median desk prices at roughly €613—up 7% from the previous year—while Melbourne recorded a small drop of 2.4%, bringing average rates down to about €463, in part due to higher vacancy rates.

Operators are reporting strong performance overall: 76.9% experienced revenue growth in the past year, and over 70% expect further growth in the coming 12 months. Occupancy rates remain high, and churn remains low, indicating that many businesses are treating flexible spaces as a permanent strategy rather than a temporary solution.

Ultra-specialized coworking spaces that cater to specific industries or communities are on the rise, supported by a shift toward more personal, community-driven experiences. Creating genuine connections with members, and building a sense of belonging, is considered essential.

Way more Google search for Coworking than for Flexible Workspace

Notably, Google search data shows that while FWA uses the term “flexible workspace,” the public overwhelmingly searches for “coworking” when seeking such services, underlines the FWA.

Supply and demand dynamics continue to evolve, says the report. Brisbane, for example, saw its coworking supply grow by 7% to over 12,400 m2, while nearly half of all operators surveyed now maintain a presence in regional or suburban areas—suggesting broader market diversification.

The majority of operators (50%) are private, Australian-owned, and treat flexible workspace as their core business. While global providers dominate in terms of total square meters, local operators are rapidly adapting to the evolving landscape.

The market is undergoing consolidation, with financially unstable operators either exiting or being acquired.

Property owners are increasingly partnering with operators through hybrid lease models that combine base rent with revenue sharing. However, challenges persist, including traditional valuation methods, brand alignment issues, and managing competition within landlords’ property portfolios.

On the financial side, the report encourages operators to frame their business in operational rather than purely real estate terms, similar to hospitality models. Predictable cash flows, EBITDA-based valuation methods, and diversified revenue streams (e.g., meeting room hire, virtual offices, events) are key to long-term stability. The flex model has proven resilient during economic downturns, with many businesses opting for shorter, more agile leasing options.

Download the full report here