In the heart of Sydney, as commuters rush between platforms to catch trains at Central Station, a striking new cutting edge timber hybrid tower casts a shadow over the buildings it dwarfs around it.<\/p>\n
It sticks out like a sore thumb in Haymarket \u2013 a part of the city that isn\u2019t characterised by gleaming skyscrapers of glass and steel like the deeper CBD to its north \u2013 as it stretches 39 storeys into the sky.<\/p>\n
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The $1.4 billion building \u2014 dubbed Atlassian Central \u2014 is a joint project between the tech behemoth it is named after and property developer Dexus, which holds the base build construction costs. <\/p>\n
Reaching its highest structural point in a recent \u201ctopping out\u201d milestone, the hybrid timber and steel tower now stands as the tallest timber hybrid building in the world at approximately 180 metres tall \u2014 roughly 100 metres taller than the previous record holder.<\/p>\n
Yet, as the structure rises, it sits at the intersection of a rapidly changing tech industry, shifting workplace trends and the spectre of an AI jobs revolution.<\/p>\n
Tower comes after massive job cuts<\/p>\n
Atlassian knows perhaps more than most about the impact of AI on jobs, as it laid off roughly 10 per cent of its global workforce \u2013 some 1600 employees, including nearly 500 in Australia \u2013 earlier this year. <\/p>\n
Co-founder and CEO Mike Cannon-Brookes said the primary objective was to \u201cself-fund further investment in AI and enterprise sales\u201d while strengthening the company\u2019s financial profile.<\/p>\n
Renowned AI expert and chief scientist at UNSW.ai Professor Toby Walsh said the gleaming new tower combined with the sweeping job cuts highlights a \u201cmajor paradox\u201d facing tech companies.<\/p>\n
\u201cOn the one hand, there\u2019s lots of evidence from around the world that innovation happens when you put people together, where there\u2019s a geographical concentration of businesses, especially when there\u2019s some high-profile anchor tenant like Atlassian to bring everyone together,\u201d he told news.com.au, pointing to established ecosystems like Silicon Valley, London\u2019s Tech Roundabout, Berlin and Stockholm. <\/p>\n
\u201cOn the other hand, we\u2019re seeing lots of companies, especially in the tech sector, laying off up to 20 per cent of their staff.\u201d<\/p>\n
With tech workers among the most frequent adopters of remote work, committing to a massive physical footprint may appear counterintuitive.<\/p>\n
\u201cEver since Covid, I only go into the office at most half the days of the week,\u201d Prof Walsh said. <\/p>\n
\u201cFor people who\u2019ve already got their careers going and already have their connections, there\u2019s so many efficiencies in terms of one\u2019s personal life, one\u2019s family life, working from home.\u201d<\/p>\n
However, he said physical proximity remains vital for the spontaneous collaboration and creative sparks that tech companies thrive on \u2014 what he called the \u201cwater cooler moments\u201d \u2014 and one way to do this was to attract staff back, which requires thoughtful investment. <\/p>\n
\u201cI think companies are going to increasingly feel that they have to invest in ensuring that there are those chance conversations,\u201d he said. <\/p>\n
\u201cThey need to make an office in an attractive place, so that people want to be there and spend the 45 minutes it takes to get there.\u201d<\/p>\n
That sense of creativity and collaboration is exactly what Atlassian is trying to achieve with its eye-catching new tower in Sydney.<\/p>\n
Wild way workers will use the tower<\/p>\n
Asked about the tower\u2019s occupancy and purpose after laying off hundreds of employees, the company gave news.com.au a fascinating insight into how working in the tower will play out day-to-day.<\/p>\n
Gina Creegan, Atlassian\u2019s head of workplace, said the tower has been designed for the \u201cfuture of work from day one\u201d. <\/p>\n
\u201cThe timber habitats bring that vision to life, connecting spaces that are purpose-built for how we work,\u201d she said.<\/p>\n
\u201cInstead of traditional desk rows, workspaces are designed around distinct modes of work: deep focus, collaboration, social connection and recharge.\u201d<\/p>\n
It is understood that each of these states of work will have its own dedicated floors inside the building \u2014 with focus rooms, sprint rooms, small meeting rooms and customer and event spaces across dedicated floors.<\/p>\n
They\u2019re also designed to feel like vertical neighbourhoods, with park floors, terraces and natural materials designed to give space to reset between different modes of work.<\/p>\n
The idea is that workers will move between these sections of the building throughout the day rather than sitting at one assigned desk.<\/p>\n
Under the company\u2019s \u201cTeam Anywhere\u201d policy, it\u2019s understood there will be no attendance quotas or a mandated number of office days, so the building will not be built for a fixed attendance target or desk per employee ratios. <\/p>\n
It\u2019s also understood that while the tower will be mainly for Sydney-based workers who come into the office regularly, it\u2019s also designed for customer events, community and team gatherings.<\/p>\n
\u201cWe\u2019re building what the biggest technology companies in the world have, with customer experience centres, partner collaboration spaces and team environments designed specifically for a global workforce,\u201d Ms Creegan said.<\/p>\n
Beyond workplace strategy, the building\u2019s environmental design marks a significant shift in urban architecture for Sydney, as it will be by far the biggest timber hybrid tower in the Southern Hemisphere.<\/p>\n
Prof Walsh said he has \u201cgreat admiration\u201d for Atlassian for using a significant amount of wood instead of all the concrete with all the carbon. <\/p>\n
\u201cIt\u2019s an interesting building, not just from a work perspective, but from a building perspective in terms of sustainability,\u201d he said.<\/p>\n
On track for practical completion near the end of the year, with interior fit-outs commencing in early 2027 ahead of a formal 2028 opening, the tower stands as a high-stakes bet on the future of collaborative work in Australia, despite the global headwinds it is facing.<\/p>\n
Why the gamble could pay off big time<\/p>\n
Atlassian\u2019s push into high-end, purpose-built space is far from an isolated gamble \u2014 it reflects a broader, systemic shift playing out across Australia\u2019s commercial property market.<\/p>\n
Data from the Property Council of Australia released this week reveals a stark market divide: while general office vacancies remain elevated, demand is surging at the top end. <\/p>\n
In the first six months of 2026, premium-grade CBD vacancy dropped by 1.2 per cent down to 10.2 per cent, driven by positive net absorption across major capitals including Sydney and Melbourne. <\/p>\n
Property Council chief executive Mike Zorbas said the office sector has moved from correction into a recovery phase defined by a sharp \u201cflight to quality\u201d.<\/p>\n
\u201cMajor occupiers are seeking the best buildings,\u201d Mr Zorbas said. <\/p>\n
\u201cBusinesses in general continue to seek workplaces that support collaboration, attract talent and provide the offerings people value.\u201d<\/p>\n
At the same time, new development has slowed to a crawl. <\/p>\n
Just 176,303 square metres of office space was completed nationally in the first half of 2026 \u2014 the lowest level in nearly a decade \u2014 with the supply pipeline expected to remain subdued through to 2029.<\/p>\n
For a landmark like Atlassian Central, this constrained pipeline could prove to be an unexpected tailwind. <\/p>\n
As old-style desk-bound offices lose favour and businesses scramble for premium, eco-friendly hubs to lure remote workers back, Atlassian\u2019s 39-storey timber hybrid isn\u2019t just a new head office \u2014 it could prove to be the exact type of high-grade space modern corporate tenants are competing to secure at a time when a severe construction drought makes them harder to come by.<\/p>\n
Atlassian stuns entire world <\/p>\n
Many in the finance world had written off Atlassian as a canary in the coalmine for the tech industry amid an AI revolution, but the Australian-American software giant has left them with egg on their faces this morning.<\/p>\n
The NASDAQ-listed tech powerhouse that develops products for software development, project management and team collaboration has made headlines several times this year for the wrong reasons.<\/p>\n
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