Property Australia

Opportunities for Canberra's offices

Karen Jamal Karen Jamal March 9, 2021

A third of Canberra public servants are still working from home, despite having some of the most spacious offices in the country. How do we boost office occupancy and the economy too?

 

  Three key takeaways:

  • Office occupancy in Canberra’s CBD fell from 68% in January to 65% in February, according to the Property Council’s latest survey data
  • 50% of Canberra’s office market is tenanted by the Australian Public Service
  • Canberra offices have social distancing baked in, with the Australian Public Service boasting 16 sqm of office space per person, compared with 8 sqm for Sydney CBD workers.

 

Canberra’s low-rise buildings are the perfect spaces for social distancing. So why are a third of the ACT’s office workers still working from home? This is an issue for more than business managers and building owners. “The impact on our economy cannot be understated,” says the Property Council’s ACT executive director, Adina Cirson.

100321 - Story 1 - Adina CirsonCanberra’s office vacancy rate sits at 10.1 per cent, and the nation’s capital was the only city where rates, rents and incentives held firm over six months to January, reveals the Property Council Office Market Report.

But office occupancy – the number of people physically sitting at their desks – has fallen from 68 per cent in January to 65 per cent in February. Cirson calls this a “mental barrier” rather than a physical one.

“Office owners have worked hard to make their buildings COVID-safe. The reluctance of public servants to return to their offices is in stark contrast with the popularity of social events. Canberra hosted a large outdoor concert a few weekends back, so people aren’t afraid to socialise,” Cirson says.

Stephen Oxford, a government leasing specialist with Synergy Group, says the ACT faces few of the social distancing challenges seen in other capital cities.

“We work in low-rise buildings that are two-to-four storeys high with massive floorplates and with an extremely generous amount of space per person. Most people drive to work. People rarely share desks. There shouldn’t be any hesitancy in getting people back into the office,” Oxford says.fa1224c576ce0a3a35920139ca44b5da_180x180

Andrew Balzanelli, JLL’s managing director in the ACT, agrees that Canberra’s “groundscrapers” are set up for socially distant working.

“The Commonwealth government footprint is modern, spacious and has high star ratings for indoor environment quality. The tallest building in Canberra’s CBD is 11 storeys – and that building has six lifts, so you never have to wait around in the lobby,” Balzanelli says. Public transport, while well patronised, still takes a backseat to the car.

“How do you get people back? Make them feel it is safe. That’s number one, and Canberra is a very safe destination.”

 

Transforming the third space

Respondents to the Property Council’s office occupancy survey nominated ‘flexibility’ as the greatest barrier to full occupancy, and this insight points to the future of the office.

“Public sector leaders have written to their teams to urge them back into the office. But if it is an order, the cultural conversation is lost. Instead, we need to be showing why the office is the ideal environment for people to connect with colleagues and do their best work,” Oxford says.100321 - Story 1 - Stephen Oxford

“On any given day there are 12,000 empty desks across the government’s ACT offices– or 170,00sqm of space. We also know that the average worker spends around 40 per cent their time at their desk, that’s a lot of space underutilised. The current market conditions and access to capital mean there’s an enormous opportunity for the Australian Public Service to take the freedom learned from COVID and make something fantastic for their workers to return too.”

Building owners are already reconfiguring space to meet new demands for flexibility, from working pods to Zoom rooms to collaboration zones that encourage the ‘social bump’. But both Oxford and Balzanelli say the critical success factor for the future office will be an experience beyond anything found at home on the lounge, at the kitchen table or at the local café.

“I think we’ll see a lot of non-productive spaces – like lobbies and forecourts – transformed into destinations so people don’t just bundy in and bundy out,” Balzanelli adds.

Molonglo Group’s NewActon remains a gold standard of precinct activation, with cinemas, galleries, restaurants and cafés operating alongside government departments. ISPT’s imaginative response to office activation is also inspiring. Floral displays at 7 London Circuit, 2 Constitution Avenue and 4 National Circuit in Barton celebrated spring after Canberra’s Floriade festival was COVID cancelled.

Balzanelli says these examples work because they address the “third space” – the place between the home and office where people can connect, collaborate, exchange ideas and gain inspiration. “We need to think differently about working environments – because that’s what we are creating. It’s not an office building that people are after. It’s a working environment.”

Cirson agrees that offices must adapt to meet demands for workplace flexibility, but she is also worried about the looming JobKeeper deadline.

“Our message to all levels of government is clear. The easiest way to get our economy back on track is to get people back into the office. Everyone from small retailers and hospitality businesses to hairdressing salons and caterers depend on it. We won’t make our economic recovery until people return to work.”

Tags: COMMERCIAL