The industry is well positioned to benefit from increased corporate workforce flexibility.
Melbourne, Australia (PRWEB) December 19, 2013
The flexibility of serviced offices has galvanised the Serviced Office Leasing industry's position in the office property market. IBISWorld industry analyst Anthony Kelly states "clients have warmed to the concept of securing a prestigious office location without having to commit to hefty long-term lease arrangements and permanent staffing costs." The onset of the global financial crisis and subsequent collapse in business confidence and private building investment took the industry from boom conditions to an abrupt halt. The magnitude of the correction in the late 2000s left in its wake a leaner and fiercely competitive industry that has steadily grown from the 2009-10 trough. Business confidence has trended upwards on the back of stronger domestic economic growth and this is expected to support annualised industry revenue growth of 3.1% over the five years through 2013-14, to reach $520.0 million. This growth has been underpinned by positive trends in private capital expenditure, commercial property yields and business travel.
Industry revenue is projected to maintain solid growth of 2.8% during 2013-14, supported by buoyant trends in private investment and business confidence, but partly contained by an easing in commercial property yields. Industry employment is projected to climb by 1.5% to 1,650 people in 590 locations. As economic conditions steadily recover over the next few years, demand for serviced office space is projected to strengthen. According to Kelly, "a shortage of prime property in the resource-rich states of Western Australia and Queensland is expected to drive demand for serviced office space." However, the elevated number of vacancies in Melbourne and Sydney will depress overall industry revenue growth. As more corporations move towards increasing workforce flexibility, industry participants are best positioned to offer such solutions.
The Serviced Office Leasing industry is expected to have a medium level of market share concentration. Industry concentration is gradually rising as the leading players add large-scale office space in the major capitals and leverage on their market profile to win a larger share of the customer base. Despite the presence of several substantial sized players, the industry is currently in its growth phase and comprises many small operators contesting for a share in narrow regional markets. Some office property management firms have tested the water in the industry by establishing serviced office facilities on one of more floors within their premises. For more information, visit IBISWorld’s Serviced Office Leasing report in Australia industry page.
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IBISWorld industry Report Key Topics
Companies in this industry rent or lease fully furnished office space to businesses on a part-time or as-needed basis. The industry also provides virtual office and conference room leasing options.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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