Across Australia, the way businesses plan their office locations is undergoing a shift; with rising property prices, new transport infrastructure, and the changing expectations of the workforce influencing and reshaping decision-making.

A recent global survey by Savills and CoreNet Global found that 63% of corporate leaders reported declining talent availability in their headquarter locations over the past three years, particularly acute in the technology sector.  In response, companies worldwide are recalibrating their strategies, and here in Australia, our team is seeing clients implementing measured adjustments – like selectively moving closer to central business districts, trialling hybrid formats, and layering flexible models - to sustain accessibility while managing costs. Equally, businesses already located in CBD locations are seeing the value in staying put and simply upgrading to higher quality spaces.

For years, suburban or fringe markets provided a clear advantage for Australian firms with lower rents and larger spaces and while these drivers haven’t disappeared, the equation is no longer so straightforward. Proximity to talent now carries equal weight, with central locations offering the pull of amenities, shorter commutes in some cases, and stronger incentives for staff to spend more time in the office. These elements directly influence employee satisfaction, collaboration, and ultimately retention, pushing businesses to re-evaluate the balance between affordability and access.

Organisations, though, aren’t abandoning suburban offices altogether, rather they’re diversifying their footprints, with some retaining outer locations while introducing central hubs and others gradually relocating particular teams where accessibility is paramount. This measured approach is helping reduce disruption while enabling businesses to remain connected to the talent pools they need most.

The pressures of housing affordability are amplifying these trends. As younger workers, in particular, are pushed further from CBDs, commuting becomes a decisive factor in workplace strategy. Long travel times weigh on productivity and wellbeing, making transport connectivity a central consideration in site selection and major infrastructure projects, such as metro and rail expansions, are helping to offset this challenge by broadening the range of viable locations and making more talent accessible to employers.

At the same time, flexibility has become a defining feature of location strategy. Hybrid working and multi-office models give employees the freedom to work in ways that suit them, while allowing businesses to maintain operational efficiency, and this adaptability is proving critical as organisations try to balance rising costs with the need to remain attractive to skilled workers.

Technology is adding another layer to this process and examples of this include data-driven tools like Propella AI, which enables decision-makers to evaluate not only rental costs but also workforce distribution, commute times, and surrounding amenity. By overlaying these factors, businesses can make location choices more closely aligned with both operational goals and employee needs, reducing risk and improving long-term outcomes.

Vacancy patterns clearly reflect these dynamics. According to the PCA’s July 2025 Office Market Report, total Sydney CBD vacancy is 13.7 per cent, while premium vacancy in the Core is much tighter at 8.8 per cent. In comparison, fringe markets like North Sydney, Parramatta, and Macquarie Park are running above 20 per cent. The contrast underlines why organisations seeking top tier space need to plan ahead with a clear real estate strategy.

Office location decisions are no longer driven by cost alone, but by factors such as accessibility, connectivity, and the overall employee experience. Balancing affordability with access is now a more complex exercise than ever before and the organisations that succeed will be those that respond to infrastructure changes, embrace flexible models, and use data to inform their decisions, ensuring they remain competitive while meeting the expectations of today’s workforce. Expert advice is vital in navigating these choices, helping occupiers balance cost, access, and flexibility to make confident, informed decisions.

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The postings by any individual on any blog do not necessarily represent the position of Savills, its strategies or opinions.