Thinking of Buying a Serviced Offices Business in Australia? Here Are 3 Vital Questions to Ask

The Australian serviced office leasing industry is valued at $652 million in 2025, employing about 2,486 people across 703 enterprises.

Profit margins average 7.7%, generating approximately $50 million in annual profit, with revenue forecast to grow by 3.1% per year through 2031, reaching around $757 million.

Growth is driven by the shift to hybrid work models, where businesses prefer flexible, short-term leasing solutions over long-term commercial tenancies. The demand for flexible workspaces is particularly strong among start-ups, SMEs, and professional service firms seeking cost-efficient, tech-enabled environments. However, profitability is pressured by rising rent costs in CBD areas and intense competition from global operators such as WeWork, IWG (Regus), and Servcorp.

1. Is the Business Financially Sustainable and Profitable?

Why It Matters:

Serviced office profitability depends on maintaining high occupancy rates, balancing rental commitments, and adapting to tenants’ changing needs. Businesses that combine premium amenities with flexible pricing models are best placed to secure consistent revenue.

What to Check:

• Revenue and margins – Benchmark performance against the 7.7% profit margin and identify if revenue is derived mainly from serviced offices, virtual offices, or meeting room rentals.

• Occupancy and rent ratios – Rent costs are the largest expense, particularly in CBDs like Sydney and Melbourne, where premium locations account for most of the industry’s 33% of establishments.

• Cost efficiency – Businesses with integrated IT systems, automation, and remote management tools reduce labour costs and achieve higher margins.

• Diverse income streams – Evaluate whether the business offers virtual office packages, pay-as-you-go meeting spaces, or short-term memberships to supplement rental income.

2. How Competitive Is the Business’s Market Position?

Why It Matters:

The serviced office sector is highly competitive, with low market concentration but growing dominance by global brands that offer scale, technology, and strong brand recognition. Local operators compete on flexibility, customer service, and location.

What to Check:

• Market share strength – Major players include WeWork (14.2%), Regus (10.4%), WOTSO (8.5%), and Servcorp (5.5%), together controlling around 39% of the market.

• Location and amenities – Central business districts remain prime, but suburban markets like Adelaide and Perth are emerging as lower-cost alternatives.

• Brand partnerships – Alignments with property owners, real estate networks, or technology providers can enhance stability.

• Customer demographics – Key tenants include professional services (legal, finance, architecture), IT firms, and small enterprises seeking short-term leases. These segments drive occupancy and renewal rates.

3. Is the Business Aligned with Industry Trends and Future Growth?

Why It Matters:

Workplace transformation is reshaping office leasing. Future success depends on adaptability, sustainability, and technological integration to meet hybrid and remote work demands.

What to Check:

• Hybrid-ready infrastructure – Demand for flexible, digitally connected workspaces is rising as more businesses adopt hybrid structures combining remote and in-office work.

• Technology and innovation – Tenants increasingly expect high-speed internet, advanced video conferencing, and automated booking systems. Providers investing in IoT and energy-efficient systems are gaining traction.

• Sustainability credentials – Offices certified under Green Star or NABERS attract environmentally conscious tenants and reduce operating costs.

• Economic resilience – With business confidence improving, short-term leases will continue to appeal to cost-sensitive firms seeking agility in uncertain economic conditions.

Ready to Invest in a Thriving Serviced Offices Business?

With the rise of hybrid work, demand for serviced offices in Australia continues to strengthen.

Businesses that combine flexibility, technology, and sustainability are positioned to capture the expanding market for scalable, cost-efficient workspaces.

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