The Perth office sector currently shows two completely opposite worlds as the demand for premium offices in some prime locations has dropped, in light of global financial turbulence and serviced offices have become very popular, very quickly.Down-sizing, restructuring and retrenchments in the banking sector have led to more people launching their own businesses and looking for portable, convenient spaces from which to commence their new ventures. The changing business market has reflected a need for more convenient, lower cost and maintained office spaces that give small businesses a chance to gather momentum.
Serviced office spaces, specifically, have risen steeply in the popularity stakes because of these changes in the finance sector. According to the experts,the trend has been noticeable for about a year already and many of the industry’s major players have monopolised on the opportunity.
The number of banking executives who have parted ways with financial institutions has increased significantly and given rise to a new wave of entrepreneurialism. Global uncertainty last year saw a number of jobs cut in the banking and financial sector. And, as global conditions are set to remain turbulent and banks continue to downsize their operations, the trend is thought to be here to stay.
In some cases it is entire banking teams, not just individuals, who are injecting new life into the economy. In some instances the teams have also taken the bank’s clients along with them. Regus has taken advantage of this market opportunity and already operates three business centres in Perth. The group expects to add other centres to this tally within the next months, in keeping with the growing demand.
Despite the success of the serviced office market, A-grade offices have not yet recovered from the slowdown in economic growth and financial institutions have shown the greatest susceptibility to the ebbs of the global money tides. And while there has been a little activity in the market analysts say that today’s start-up companies have comparatively modest requirements and are not looking to be extravagant by taking out large office spaces. The focus is on low maintenance, fully-serviced spaces on flexible leases.
It is hoped that the A-grade office sector will see some kind of revival by the second half of the year but it looks as though markets would need to do quite a turn around and prices would need to remain competitive in order for the sector to bounce back.
The news comes to the fore as the federal government calls for Australian businesses to engage more actively with Asian markets. Analysts are countering the construction, claiming that the ties are in place and are already being more deeply entrenched.Data tells us that 70% of Australian exports are to Asian countries, while South Korea, China, India and Japan receive 55% of the country; exports alone. Additionally a free trade agreement has already been concluded with Malaysia and FTAs are currently under negotiation with Japan, South Korea, India, Indonesia and China.
As far as student visas are concerned 12 out of the 15 top countries of origin for foreign students studying down under come from Asian countries. Seven out of Australia’s 10 tourism markets are also Asian countries. Claims have also been launched this week that one of the country’s big four banks is planning a major Asian acquisition soon. The bank’s recent increase in share prices has seen its market value surpass $100 billion dollars already and the financial institution has suggested that it is looking to expand its operations beyond local borders. Perhaps this will be the tie that finally binds the two regions and gives both the opportunity to explore greener pastures.