The true cost of a traditional office
A traditional office could cost millions of dollars over the life of a lease. But Hub Australia’s Office Cost Calculator shows rent is often only part of the story.
Beyond rent: what businesses often overlook
As businesses review budgets and plan for the year ahead, many will take a close look at payroll, technology and operating expenses. But one of the largest costs on the balance sheet often gets viewed through a surprisingly narrow lens.
Most businesses reduce workplace costs to a rent figure. Yet by the time fit-outs, furniture, utilities, cleaning, administration support and end-of-lease obligations enter the picture, the true cost of running an office can look very different.
Why EOFY is the right time to review
For growing businesses, EOFY presents an opportunity to look beyond the headline rent figure and understand exactly where workplace dollars are being spent.
Where workplace costs really add up
According to Hub Australia’s Office Cost Calculator, a traditional office for a 20-person team can cost several million dollars over a typical three-year lease term.
What surprises many businesses isn’t the rent itself, but everything that comes with it.
DESIGN NOTE: Insert comparison table here
| City |
Traditional office |
Hub Australia (3 years) |
|---|---|---|
| Sydney | $2.3m | $569,000 |
| Melbourne | $1.93m | $525,000 |
| Perth | $1.64m | $468,000 |
| Canberra | $1.64m | $406,000 |
| Brisbane | $1.62m | $468,000 |
| Adelaide | $1.34m | $374,400 |
Based on a 20-person team over three years.
Hub Australia Co-CEO John Preece said businesses often underestimate the costs associated with maintaining their own workplace.
“Rent is usually the starting point, but it’s only one part of the equation,” he said.
“When you add fit-outs, furniture, internet, utilities, cleaning, administration support and make-good obligations, the total cost of running a workplace can be significantly higher than expected.”
In Sydney, for example, fit-out and furniture costs alone can exceed $1.5 million over three years. Add outgoings, utilities, cleaning, administration support and make-good obligations, and the additional costs can rival the cost of rent itself.
DESIGN NOTE: Insert Sydney cost breakdown graphic here
| Cost category | Three-year cost |
|---|---|
| Rent | $974k |
| Fit-out & furniture | $639k |
| Outgoings | $214k |
| Utilities | $86k |
| Cleaning | $58k |
| Reception/admin | $162k |
| Make-good | $168k |
For many businesses, these expenses are spread across multiple suppliers, contracts and budgets, making them easy to overlook during annual planning.
A smarter EOFY workplace review
EOFY is often when business leaders make some of their biggest decisions about growth, people and investment. Understanding the true cost of your workplace can help inform those conversations.
Why more businesses are choosing flexible workspaces
That’s one reason more businesses are exploring flexible workspace models. Rather than managing multiple workplace expenses separately, a single membership bundles many of the costs associated with running an office.
At Hub Australia, that includes a fully furnished private office, high-speed internet, utilities, cleaning, meeting rooms, end-of-trip facilities and support from an on-site hospitality and Welcome Desk team. It means businesses can access a ready-to-use workplace with many operational costs already covered.
What business leaders are saying
“The way businesses use office space has changed significantly over the past few years,” said Preece. “Many leaders seek greater flexibility and more certainty around workplace costs. EOFY is a natural time to review whether your current setup is supporting your business goals and the way your team actually works.”
Questions to ask before locking in your budget
For businesses planning for growth, it’s also an opportunity to ask some important questions:
- Are you paying for more space than your team needs?
- How much capital is tied up in workplace infrastructure?
- Are workplace costs predictable enough for the year ahead?
- Could greater flexibility free up resources for growth, technology or people initiatives?
Start with the full picture
The answers will be different for every business, but understanding the full cost of your workplace is the best place to start. Before locking in next year’s budget, take the time to look beyond rent and explore the costs that may be hiding in plain sight.
Use Hub Australia’s Office Cost Calculator to understand the true cost of your current workplace and explore your options for the year ahead.
