From office towers to retail strips
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From office towers to retail strips – professional services are on the move
Over the past year, a growing number of professional service providers like lawyers, accountants, engineers and conveyancers have relocated from traditional office towers to ground-floor retail spaces. This trend is increasingly visible across Sydney, including the North Shore. While these spaces were once dominated by milk bars and apparel retailers like women’s fashion boutiques and shoe shops, today, they’re attracting more white-collar tenants keen for street-level exposure. The trend, along with other factors like companies downsizing and the post-Covid popularity of working from home, is leaving many office towers at risk of long-term vacancy.
High-level findings from the Property Council of Australia suggest that CBD office vacancy rates in major Australian cities have risen in the last six to twelve months, partly due to tenants downsizing and seeking smaller or more flexible spaces outside traditional towers but also due to the emerging trend of opting for retail and suburban street frontage locations. Although exact figures vary by region, the broad pattern is clear – professional service providers are rethinking their workspace choices.
At Shead Property, we’ve seen this shift unfold across several North Shore suburbs such as Wahroonga, Turramurra, Roseville and Lindfield. In the past six to twelve months, we’ve received a noticeable spike in enquiries from professional service providers interested in street-facing tenancies.
Why has this become a trend?
Independent retailers, especially those selling women’s apparel and accessories, are finding it increasingly difficult to compete with major retail chains. As a result, many long-standing businesses, sometimes in the same location for decades, are sadly closing their doors and leaving the premises vacant.
This has presented an opportunity for professional service providers. Operating from a street front premises offers them several benefits, including:
Exposure – A ground-floor location offers immediate brand recognition, enabling passers-by to see and engage with the business as they go about their day or head to and from work.
Comparable (or lower) rents: We are finding that some professional service providers pay similar or even lower rates per square metre than they would in a high-rise building.
Convenience for clients: Ground-level locations often provide easier and more convenient access for customers.
We’ve already helped numerous clients secure locations that were previously occupied by retailers, spaces that, until recently, wouldn’t have been on a lawyer’s or accountant’s radar. For example, we recently supported an accounting firm's relocation from a Chatswood high-rise to a shop in Roseville that a women's fashion boutique had occupied for decades.
Our process: Raising awareness of all the options
At Shead, we never prescribe what a client should do. Instead, our philosophy is to make them aware of all possible options – from office suites to suburban street frontages – and equip them with the knowledge and resources to make an informed decision. If a tenant ultimately decides a retail shopfront is the right move for their professional service business, we’ll help them secure a site that meets their requirements.
Is this trend here to stay?
Commercial property owners in retail strips are increasingly open to non-retail tenants because they’re typically established, reliable businesses seeking long-term leases. While they may not have retail flair, professional service businesses are usually safe, secure tenants. And from the tenant’s perspective, many professional service providers wouldn’t have considered a shopfront a couple of years ago. But once they see the potential benefits, they often realise it’s a great fit.
So, with rising office vacancy rates and continued pressure on traditional retail, we will likely see more professional service providers moving to high street shopfronts. It’s a win-win for both tenant and landlord. Business owners get a more visible, conveniently located space, while landlords benefit from a stable tenant generally prepared to sign a long lease.
Interested in exploring a street front location for your professional service business?
Our team will help you navigate northern Sydney’s evolving commercial real estate market by offering the knowledge, connections and transparency you need to make the right decision for your business. For more information, contact Bill Geroulis on 0413 100 200 or email bill@shead.com.au.
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