Co-working on cards for Collins St’s T&G Building

Spaces — part of London-listed serviced office giant IWG, which has more than 3000 locations globally — already has a location in inner-suburban Richmond and one in Sydney’s Surry Hills, but will now open at the Paris end of Collins St.

The deal comes as local and global co-working space operators make inroads into the Australian market.

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US-based co-working group WeWork opened its first Melbourne office late last year and is actively looking for more sites, referring to traditional office towers as its competition.

But flexible and more traditional office environments can co-exist, according to Pembroke Real Estate vice-president and head of Australia Matthew Knight.

“I think they can work together,” Knight tells The Australian. “This isn’t a case of us trying to keep up with the Joneses — if we were trying to do that probably we would have already launched our own product.”

He says the operator will be a “significant addition” to a building that has already signed key office tenants including professional services firm Accenture and wealth manager IOOF, and is undergoing a major refurbishment set to be complete by the end of February.

Pembroke has a global relationship with IWG, which is a tenant in its buildings in Sydney, Tokyo and elsewhere, but Knight says the group has spoken to several other co-working operators before signing the deal.

“One of the important things for us is the long-term longevity and business acumen of the entity itself. Co-working spaces are a little bit untested in terms of market downturns,” he says, adding that the tenant has been operating for a “very long time”.

Spaces will take a total of about 4600sqm, including all of the second level and 600sqm on level one with direct access to the ground floor lobby.

The agents on the leasing deal were Adam Raap and Tim Farley from Colliers International’s Occupier Services team.

This article originally appeared on www.theaustralian.com.au/property.