Why hotel lobbies are becoming co-working lounges

Key takeaways

• You are no longer just selling rooms. You are selling space, time, and flexibility to remote workers, small teams, and local professionals.
• Hybrid work is entrenched in Australia. According to the Australian Bureau of Statistics, around 40 percent of employed people worked from home at least part of the time in 2023. That shift is reshaping demand for hotel common areas.
• Co-working style lobbies can lift food and beverage revenue, increase dwell time, and create a pipeline for meetings and events bookings.
• The opportunity is strongest in CBD and major regional hubs such as Sydney, Melbourne, and Brisbane, where office occupancy remains below pre-2020 levels.
• To do it well, you must manage zoning, licensing, insurance, privacy, cybersecurity, and noise expectations.
• Successful operators treat the lobby as a flexible revenue asset, not a passive waiting area.
  

Introduction: the lobby is no longer a waiting room

If you operate a hotel in Australia today, you are navigating two powerful forces at once. The first is a steady recovery in travel demand. The second is a structural shift in how Australians work.

Hybrid work has moved from temporary pandemic response to embedded business practice. The Australian Bureau of Statistics reports that working from home remains significantly higher than pre-2020 levels, particularly in professional services, finance, and technology. At the same time, CBD office vacancy rates in several capitals remain elevated, according to market data cited by the Property Council of Australia.

For you as a hotel operator, that creates a strategic question: what should your public spaces do during the 9am to 5pm window, especially midweek?

Increasingly, the answer is clear. Hotel lobbies are evolving into co-working lounges. Not in a gimmicky way, but as a deliberate repositioning of space, service, and revenue strategy.

The hybrid work economy is structural, not temporary

What the data tells you

Hybrid work in Australia is not fading. According to the Australian Bureau of Statistics, around two in five employed Australians worked from home at least once a week in 2023. In professional, scientific and technical services, the proportion is significantly higher.

This matters because:

• These workers still need professional-grade environments.
• Many no longer have permanent desks in corporate offices.
• Freelancers, consultants, and small agencies are growing segments.
  
  

IBISWorld estimates that Australia’s co-working and serviced office sector generates billions in annual revenue and has expanded rapidly since 2020. That demand is not solely CBD-based. Regional centres with strong population growth, such as the Gold Coast and Newcastle, are also seeing growth in flexible workspace demand.

What this means for your lobby

If your lobby currently serves as:

• A check-in zone
• A transient waiting area
• A casual coffee spot
  
  

You are likely underutilising prime real estate.

Your lobby can become:

• A productive work environment for business travellers
• A paid day-use workspace for locals
• A feeder channel into your meeting rooms and F and B
  
  

The key insight is that you are not competing only with other hotels. You are competing with purpose-built co-working brands and even suburban cafes.

Underperforming daytime assets are a hidden opportunity

The midweek utilisation gap

Many Australian hotels experience:

• Strong occupancy Thursday to Sunday
• Softer corporate travel Monday to Wednesday in some markets
• Quiet lobby periods between breakfast and afternoon arrivals
  
  

At the same time, CBD foot traffic has not fully returned to pre-2020 levels. Data cited by the Property Council of Australia shows that office occupancy in some capital cities continues to sit below historical norms.

This creates a supply-demand mismatch:

• Offices are underutilised
• Co-working providers are selective on new leases
• Professionals need flexible space
  
  

Your hotel can fill that gap without acquiring new real estate.

Revenue levers you can activate

By repositioning your lobby as a co-working lounge, you can create multiple income streams:

• Day passes or membership-style access
• Increased coffee, breakfast, and light lunch sales
• Meeting room upsells
• Event bookings from regular users
• Extended stays from remote workers
  
  

Consider a realistic scenario in Melbourne’s CBD. A boutique hotel converts part of its ground-floor lobby into a zoned workspace with high-speed Wi-Fi, acoustic booths, and power access. It introduces:

• $30 day passes including one coffee
• Discounted meeting room bundles
• Loyalty perks for frequent users
  
  

Within six months, weekday F and B revenue increases by 18 percent, and meeting room utilisation improves significantly. That uplift is driven by local professionals, not overnight guests.

Designing for productivity without alienating guests

Zoning is critical

The biggest operational risk is conflict between:

• Business travellers and leisure guests
• Quiet workers and social drinkers
• Short-term lobby users and paying members
  
  

You need clear spatial zoning. Practical approaches include:

• Dedicated work tables with ergonomic seating
• Acoustic screens or soft furnishings to dampen noise
• Semi-private booths for calls
• Clear signage indicating quiet zones
  
  

You are not building a full co-working floor. You are creating a layered environment where different user types can coexist.

Technology standards matter

Australian professionals expect enterprise-grade connectivity. The minimum requirements include:

• High-speed, secure Wi-Fi
• Multiple power points and USB access
• Reliable mobile coverage indoors
• Secure guest network segmentation
  
  

Cybersecurity and data privacy are particularly relevant if users are handling client information. You should ensure your IT provider can demonstrate compliance with the Australian Cyber Security Centre guidance on business cybersecurity.

Failing to meet these expectations will undermine credibility quickly.

Compliance, licensing and risk management in Australia

Repositioning your lobby as a co-working space is not simply a design exercise. It can have regulatory implications.

Planning and zoning

In most Australian jurisdictions, hotels are approved for accommodation and hospitality use. Introducing paid workspace may fall within existing approvals, but you should confirm:

• Local council zoning definitions
• Any need for change-of-use applications
• Signage restrictions
  
  

If you operate in NSW, consult guidance from NSW Department of Planning and Environment. Other states have equivalent planning authorities.

Liquor licensing considerations

If your co-working lounge operates alongside a bar:

• Are non-hotel guests permitted under your licence conditions?
• Do time-of-day restrictions apply?
  
  

Check your specific licence class and conditions. This is particularly relevant if you plan to host networking events or after-hours functions.

Workplace health and safety

Under the model WHS laws adopted in most Australian states, you owe a duty of care to workers and visitors. While co-working users are not your employees, you still have obligations regarding:

• Safe seating and layout
• Trip hazards from power cables
• Emergency egress
  
  

You may need to review your risk assessments and public liability insurance coverage.

Positioning: who are you targeting?

Not all hotels should pursue the same strategy. The opportunity varies by location and brand.

CBD full-service hotels

In Sydney or Melbourne CBD:

• Target consultants, lawyers, tech workers, and corporate teams
• Offer premium pricing and high service standards
• Bundle workspace with meeting rooms and catering
  
  

Airport hotels

At airports, the play is different. Here, your market includes:

• Fly-in, fly-out professionals
• Transit passengers with long layovers
• Corporate travellers between meetings
  
  

Flexible half-day workspace packages can capture this demand.

Regional and lifestyle destinations

In regional centres, especially high-growth areas, you may attract:

• Local entrepreneurs
• Remote employees avoiding long commutes
• Start-ups needing flexible space
  
  

A practical example could be a coastal hotel on the Gold Coast introducing weekday memberships for local professionals. The hotel benefits from steady midweek F and B sales, while members gain a professional alternative to working from home.

Food and beverage as a strategic differentiator

Co-working brands compete heavily on amenities. Your advantage is hospitality.

The commercial upside

According to the Australian Bureau of Statistics, food services remain a significant contributor to hospitality turnover nationally. By encouraging daytime dwell time, you can increase:

• Coffee sales
• Breakfast and light lunch orders
• Afternoon beverage consumption
  
  

Rather than discounting rooms, you are driving incremental spend from non-residential users.

Practical F and B strategies

You might consider:

• Bundled day pass plus coffee packages
• Pre-paid lunch credits
• Members-only menu items
• Afternoon networking events
  
  

The objective is to turn workspace users into repeat F and B customers.

Competing with established co-working brands

You are entering a space occupied by global and local operators.

Brands such as WeWork and Hub Australia have built strong reputations for flexibility and community.

However, you have structural advantages:

• Prime locations in CBD and lifestyle precincts
• Existing meeting rooms and event spaces
• Hospitality service culture
• Accommodation for travelling members
  
  

The question is not whether you can outcompete dedicated co-working providers on every feature. It is whether you can offer a differentiated hybrid experience.

For example:

• A consultant flying into Brisbane can work from your lobby, hold a client meeting in your boardroom, and stay overnight without changing venues.
• A local start-up can host a pitch event in your function space and transition seamlessly into after-work drinks.
  
  

That integrated experience is difficult for standalone co-working providers to replicate.

Pricing models that work in the Australian market

Your pricing must reflect local willingness to pay.

Common models

• Casual day passes
• Multi-day packs
• Monthly memberships
• Corporate bundles
  
  

CBD pricing can typically support premium positioning. Regional markets may require more accessible entry points.

Avoiding cannibalisation

You must ensure:

• Workspace access does not displace higher-margin event bookings
• Guests are not crowded out
• Brand perception remains consistent
  
  

Clear capacity management and booking systems are essential.

Brand implications and guest perception

There is a legitimate concern that transforming your lobby could dilute your brand, particularly in luxury segments.

To avoid this:

• Maintain aesthetic coherence
• Ensure noise is managed
• Curate your target audience
  
  

You are not creating a chaotic open office. You are creating a refined, flexible lounge.

A high-end Sydney hotel might:

• Limit access to registered members
• Offer concierge support for business services
• Provide discreet private call rooms
  
  

Done well, this can enhance your brand as modern and business-savvy.

Measuring return on investment

Before you invest in fit-out and marketing, define your KPIs.

Quantitative metrics

• Weekday F and B revenue growth
• Meeting room utilisation rates
• Average dwell time
• Incremental membership revenue
• Conversion from day user to overnight guest
  
  

Qualitative indicators

• Guest satisfaction scores
• Online reviews referencing workspace
• Corporate account feedback
  
  

Track performance over at least two quarters to account for seasonality.

Conclusion: from passive space to strategic asset

The shift from traditional lobby to co-working lounge reflects a deeper transformation in Australia’s work culture. Hybrid work is embedded. CBD utilisation patterns have changed. Professionals demand flexibility.

For you, this is not about chasing trends. It is about extracting more value from existing assets while aligning with structural changes in how Australians live and work.

By grounding your strategy in local data from bodies such as the Australian Bureau of Statistics and understanding planning and licensing frameworks, you can move confidently.

If you approach it strategically, your lobby stops being a waiting area. It becomes a revenue engine, a community hub, and a competitive differentiator in an evolving hospitality landscape.