Australian Financial Review
Sydney’s Tech Central precinct faces competition
Sydney’s emerging tech precinct can become a leading hub for tech start-ups but needs government support to encourage more businesses to relocate as well as facilities and financial support to help the city compete in the global war for tech talent, companies in the area say.
Workspace provider Tank Stream Labs has taken 4000 square metres across five floors of the Transgrid building at 24 Campbell Street in Haymarket and last week opened what it says is the first operational scale-up hub for businesses in the Tech Central precinct.
Setting the space pace: Tank Stream Labs CEO Bradley Delamare, left, and Douugh CEO Andy Taylor in the new Haymarket coworking space. Rhett Wyman
The company, which follows a string of businesses that have already moved to the precinct, such as Afterpay, also plans to near-double its capacity to 7000sq m by taking the remaining three floors over the next year in response to what it says is greater demand for flexible space as businesses adjust to living with COVID-19.
But the state government needs to do more for the precinct that will eventually stretch from Haymarket to Redfern on the edge of the CBD and which it hopes will offer 250,000sq m of floors pace for tech businesses, the workspace provider said.
“The NSW government needs to be driving the Tech Central precinct through building the ecosystem in the area,” Tank Stream Labs chief executive Bradley Delamare said.
The government, which described the precinct as a rival to Silicon Valley when announcing Atlassian’s nearby 40-storey office tower in 2020, should use grants and funding schemes to help businesses relocate, he said.
A diversification of property offerings was also crucial, Mr Delamare said.
“Not all businesses want A-grade corporate offices so how will the property be diversified to attract a variety of businesses?” he asked.
The region is already getting a boost from companies seeking more flexibility.
ASX-listed fintech Douugh moved its 29 Sydney-based staff to the new premises – it had up to 38 people but has cut staff in the past six months to preserve cash – and the month-by-month contract with Tank Stream Labs suited it better than the per-desk, 18-month lease at its previous space at Dexus’ 44 Market Street tower.
“It was a bit more traditional, a bit more corporate,” Douugh CEO Andy Taylor said.
The pandemic had also changed workplace patterns and having more workers variously at home made flexibility crucial, Mr Taylor said.
“The flexibility is really important for our sort of business now,” he said.
The precinct will be supercharged by the completion of the 75,000sq m Atlassian tower – possibly in 2026, the year the first stage of the Dexus-Frasers Property joint venture Central Place Sydney office development is due to come on line.
But the area faces challenges – locally and globally. Construction management software company Procore has just taken up nearly 1400sq m across two floors in the Built-developed Substation 140 heritage building at 185 Clarence Street in the CBD.
“We surveyed the local market and there was nothing that fitted our space, time, price requirements at that point in the tech precinct,” said Procore’s regional vice-president, Tom Karemacher.
“As well as this, the location was also the least disruptive to our employees’ current commute patterns, and we are glad to support the reinvigoration of the CBD.”
Procore was unlikely to move to the Tech Central precinct, Mr Karemacher said.
“Though we are a tech company, we are building a diverse workforce including hiring from the construction industry – who are not necessarily based near tech hubs.”
Mr Taylor said for a precinct such as Tech Central to fulfil its promise, financial support was also necessary to allow smaller tech companies to be able to attract and retain skilled workers who were in high demand the world over – and not just in Sydney.
“There should be government support to be able to match the salaries on offer from the big tech companies like Canva and Atlassian, as well as the major banks,” he said.
“We just can’t compete at the moment and I believe they are threatening the very existence of a thriving start-up ecosystem. As if we can’t afford top talent, how are we going to drive the innovation agenda?”
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Michael Bleby covers commercial and residential property, with a focus on housing and finance, construction, design & architecture. He is based in Melbourne. Connect with Michael on Twitter. Email Michael at email@example.com