The Flexible Workspace Series: Part 4
In addition to the challenges explored in parts 1-3 of the series, there are some important factors investors, operators and landlords alike should consider when thinking about whether to invest in, take up or let flexible workspace. Initially there are the day to day operational difficulties of running a multi-occupancy flexible workspace with its complaints of overcrowding, sudden rental hikes and opaque monthly bills, and then furthermore beyond these practical considerations there is still no clear methodology behind how flexible workspace is valued which is clearly an important factor, and one which has been particularly highlighted by the recent RICS report ‘Valuation of flexible workspace’1 and the attempted WeWork IPO.
Ultimately, every occupier’s needs will be different and whilst flexible workspace may not be suitable for all occupiers, the increase in demand overall is permeating through to the office market as a whole. JLL have warned that as flexible workspace becomes more mainstream, there is a risk of being behind the curve. This risk should encourage the conventional office space market to champion what sets them apart whilst also responding to the increasing demand for connectivity, community and the flexibility that flexible workspace offers occupiers in order to stay competitive.
In conclusion, the biggest challenge going forward for the office space market as a whole, whether conventional or flexible, will be what Strutt & Parker have identified as finding the balance between providing space that is both flexible and diverse, but which also gives occupiers areas where they can do focused, concentrated independent work in a secure environment which does not dilute their brand or pose a threat to cybersecurity2.
We hope that you enjoyed The Flexible Workspace Series. If you would like to provide us with some feedback or find out more about any of the topics discussed in this series, please get in touch with the author at firstname.lastname@example.org.
1 RICS Insight Paper, ‘Valuation of flexible workspace’, October 2019, https://www.rics.org/globalassets/rics-website/media/knowledge/research/insights/valuation-of-flexible-workspace.pdf
2 (n 10)