Speculative suites are becoming a successful way to attract tenants for office space, allowing landlords to stay competitive by offering modern and fresh spaces. These spec fitouts typically vary from 60 to 1,000sqm.
The commercial real estate market is still presenting challenges for both landlords and tenants who are eager for quick solutions. Spec fitouts offer flexibility and quality with the minimal heavy lifting for potential tenants. The incoming tenants can take full advantage of the space without the high cost of construction or engaging a design team, and with free fitout, in a short period.
The speculative fitout trend is increasing across main cities such as Brisbane, Sydney, and Melbourne, as businesses return to the office post-pandemic.
Over the last months, the high level of vacancy in Brisbane CBD pushed landlords to seek out innovative solutions to attract lessees. Solutions like luxe furniture and finishings, attractive end-of-trip facilities, stylish break areas and inviting entrances were some of the many ways landlords were (and still are) appealing to incoming tenants.
Brisbane is now Australia’s largest spec office suites market, with more than 27,000 sqm of spec space available and robust demand across all types of buildings.
Amicus Project – 67 High Street: Converting a singular occupant building to a variety of spec suites
The 67 High Street goal was to create an appealing and diverse home for potential tenants.
The Amicus Design team repositioned the building to cater to future tenants and bring the old space back to life. Creating a versatile business hub that houses solutions from medical facilities and childcare to legal and professional services.
Despite the pre-pandemic landscape, the majority of the building’s spec suites were successfully leased before completion.
Sydney currently is the second largest spec fitout market in Australia, with around 9,300 sqm of spec suite space available in industries including Banking, Finance, and Insurance.
Landlords are being selective in the concept design phase, ensuring that the design of the suite is attractive to the tenant that they want in the building.
With the lift of almost all restrictions, including the opening of international borders earlier this year, there is a sense of positivity and desire to get back to the workspace.
Despite the challenges faced in the last few years such as COVID-19 lockdowns and unprecedented floods, data from Cushman & Wakefield shows the leasing activity has remained solid across Sydney CBD, the average incentive has been steady above 25%, which supplies space for tenants to get free fitout when leasing spec suites.
Amicus Project – Grafton Bond Building:
The Grafton Bond Building has an unbeatable location adjacent to the newly developed Barangaroo precinct, bringing a unique heritage value to the area.
Targeting small companies, creative start-ups and the media industry as potential tenants, Investa and Colliers partnered with Amicus to take the challenge of transforming four suites and bathrooms, and the result is incredible.
The design was the most crucial factor and point of difference in this project, highlighting the history and heritage while providing a modern twist, the goal of the Amicus Design team was to update the dark and outdated design, turning it into beautifully designed spec suites, resulting in open and modern heritage spaces.
Melbourne’s leasing market has changed over the last few years thanks to the generational shift in the way people work, which can be seen in the increasing demand for smaller suites. Melbourne data from the Knight Frank report has found that buildings with spec suites space remain on the market for a shorter time on average.
Amicus Project – 627 Chapel St:
With the development of a commercial office tower, Goldfields engaged Amicus to deliver a range of diverse-sized suites to appeal to a variety of tenants. Working closely with an Interior Design partner, Amicus was able to deliver sleek designed spec suites ahead of time and on budget.
This project outcome was consistent with the emerging Melbourne market, with several suites leased prior to the construction being completed.
Speculative fitouts in the Australian property market are the future. Bringing endless possibilities, where companies embracing new ways of working, innovation and flexibility are the new normal.
Interested in exploring how you can design smart, attractive & tailored spec suites? Find out more here >
* Sources:
- Cushman & Wakefield: Sydney MarketBeat Report, 2022 Report
- Knight Frank: Sydney CBD Office Market, 2022 Report
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