Property Council slams Victoria's proposed work from home legislation
After years of pandemic-induced uncertainty, Melbourne's office market is finally showing signs of stability.
The new Property Council Office Market Report confirms a modest but meaningful decline in CBD office vacancy – down from 18 per cent to 17.9 per cent.
This bucks the national trend and is a small but vital signal that confidence is returning to our city centre.
That's why the Victorian government's proposal to legislate the right for private sector workers to work from home two days a week is not just poorly timed – it's deeply concerning.
It comes at a time when the federal government has productivity improvements in its sights but is an act that turns its back on Victoria's most productive asset: Melbourne's CBD.
The Melbourne CBD is Victoria's most productive asset. Picture: David Crosling
Let's be clear – flexibility is not up for debate.
It is already a hallmark of modern workplaces — many employers have adopted hybrid models, to suit the needs of their teams and businesses.
We've also seen businesses going above and beyond to earn the commute of their staff, offering everything from sleep-pods and health hubs to DJ decks and golf simulators in their offices.
After two years of being the most locked-down city in the world and rapid adjustment to new norms, it's clear that employers have found models that work best for their teams.
Mandating working from home through legislation strips away the very flexibility the government claims to support.
The diversity of Victoria's private sector means there is no one-size-fits-all solution.
What works for a tech start-up may not suit a legal firm or design practice.
Decisions about work arrangements should be made by employers and their staff, not imposed by politicians from Spring St.
Even in 2025, Melbourne's CBD is still in recovery mode.
Small businesses – cafes, retailers, service providers – depend on consistent foot traffic.
Every government policy that discourages people from returning to the city chips away at its ongoing revitalisation.
The Allan-government wants to legislate to right to work at home two days a week. Picture: Supplied
Our report shows that we are starting to see momentum build: new leasing activity, demand for more affordable B-Grade office stock, and a tapering in sublease vacancies.
These are all signs of businesses regaining confidence in their workplace strategies.
Meanwhile, Melbourne has the strongest future supply pipeline nationally, with more than 300,000sq m of new office space set to come online by 2027.
Developers and investors are backing our city. They need a policy environment that backs them in return.
Victoria already suffers under the country's harshest property tax settings.
Now, the threat of mandated work-from-home rules sends another damaging message to employers and investors: Melbourne is not open for business.
We need to support our CBD's recovery, not jeopardise it.
The private sector is doing its part.
We're asking the government to do the same: back business, protect choice, and keep Melbourne open for investment and growth.
Cath Evans is Victorian Executive Director of the Property Council.
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