The Sturt Street Bet: How One Ballarat Developer Is Rewriting the Office Market Playbook

Ballarat's commercial property market is splitting in two. On one side: ageing, single-tenancy office stock sitting half-empty along Lydiard Street and the outer Bridge Mall precinct. On the other: a thin but growing tier of adaptive, short-lease workspace that local operators say cannot be built fast enough. The clearest example of that second tier is currently taking shape at a refurbished building on Sturt Street, where Ballarat-based developer Meridian Property Group has converted three floors of a former insurance office into flexible co-working and private suite space — and has already leased 80 per cent of the net lettable area before the fitout is complete.

The timing matters. National commercial real estate data from CBRE's June 2026 regional Victoria report put the Ballarat CBD office vacancy rate at 14.2 per cent — up from 11.8 per cent in mid-2024 — driven largely by hybrid work policies that have not reversed and by the departure of several state government tenants who consolidated back into Geelong. Against that backdrop, gross face rents for B-grade stock on Lydiard and Curtis streets have slipped to around $210 per square metre per annum, a figure that makes traditional leasing economics brutal for landlords carrying older buildings with deferred maintenance bills.

Filling the Gap the Big Landlords Left

Meridian's model sidesteps that problem by charging monthly memberships and short-term licences rather than three-to-five-year leases. Private offices in the Sturt Street building are listed from $1,850 per month for a two-person suite, with hot-desk memberships at $295 per month. That per-square-metre equivalent is well above the market face rent — but tenants, the company argues, are paying for flexibility and fitout they do not have to fund themselves. Anchor occupants confirmed so far include a digital marketing agency, a Ballarat-based arm of a Melbourne law firm, and a regional office for a federal government contractor.

The precinct context helps. The Sturt Street corridor — running from the train station precinct toward the Ballarat Base Hospital — has absorbed a quiet but steady stream of professional services in the past two years, partly because the City of Ballarat's Invest Ballarat program has actively courted health-tech and professional services firms looking for a foothold outside Melbourne. The co-working pitch aligns with that recruitment effort: businesses can trial a Ballarat presence without committing to a ten-year head lease on a building that may need a new HVAC system.

Federation University's city campus on Camp Street is also pulling foot traffic into the inner CBD, and Meridian's principals have been explicit in marketing materials about positioning the Sturt Street building as a landing pad for university spin-offs and graduates who want to stay in Ballarat rather than commute to Melbourne.

What the Numbers Need to Prove

The flexible workspace sector is not without risk, and Ballarat is not Sydney. Co-working operators nationally have had a patchy five years — the WeWork collapse in late 2023 cast a long shadow, and several smaller Australian operators quietly shut sites in regional cities through 2024 and 2025 when membership volumes failed to cover fixed occupancy costs. Meridian's principals have structured the Sturt Street deal with a purchased freehold rather than a head lease, which removes one layer of that structural risk.

The broader commercial market will be watching the building's first twelve months of operation closely. If occupancy holds above 75 per cent through to mid-2027, it would give other Ballarat landlords sitting on vacant B- and C-grade stock a credible case study for conversion. The City of Ballarat's economic development team has indicated it is tracking the project as part of a wider review of the CBD activation strategy due to be presented to council in the first quarter of 2027.

For business owners weighing up a Ballarat office, the practical upshot is straightforward: the city now has more genuinely flexible commercial space than it did eighteen months ago, concentrated between the Sturt Street spine and the Bridge Mall edges. Rents on traditional leases have eased. The stock that cannot adapt is quietly being left behind.