The Rise of Flexible Office Spaces: A Paradigm Shift in Work Culture
Flexible office spaces are redefining the workplace landscape as professionals and businesses increasingly embrace hybrid work models. According to a recent report by Cushman & Wakefield in partnership with WeWork, employees using flexible office spaces aim to increase their usage to encompass half of their workweek. This shift marks a significant 19% rise from current levels, underscoring a growing preference for balance between office collaboration and remote work.
Flexibility as a Catalyst for Change
The pandemic catalyzed a transformation in how we view workspaces. Rob Lowe, Executive Managing Director at Stream Realty Partners, highlights that while the flexibility of working from home (WFH) has been advantageous, excessive reliance on WFH can erode company culture, learning opportunities, and productivity. This realization is leading to a middle ground: hybrid work arrangements that provide the best of both worlds.
Businesses are capitalizing on flexible office solutions to foster collaboration, maintain cultural integrity, and adapt to evolving workforce demands. These spaces allow companies to avoid lengthy lease commitments, enabling greater agility in an uncertain economic climate.
A Longstanding Trend Amplified
Kevin Fagan, Head of CRE Economic Analysis at Moody’s Analytics, notes that flexible office usage was thriving even before the pandemic. From 2016 to 2020, the amount of space leased to flexible office operators more than doubled in the U.S. This trend was not exclusive to industry giants like WeWork but included smaller operators and specialized providers catering to niche markets.
The pandemic’s aftermath has reinforced the value of flexibility, positioning flexible offices as an integral component of commercial real estate. While shorter lease terms may introduce volatility, they also enhance property value by serving as functional, adaptive spaces for tenants.
Addressing Evolving Workforce Needs
Regan Donoghue, Senior Principal Strategy at Unispace, underscores the necessity for workplaces to adapt to ongoing changes. The hybrid model is just the beginning; the future demands environments that are agile, responsive, and designed to spark creativity.
“For so long, the workplace has been static and stale,” Donoghue explains. “It’s time we let our work environment become an adaptable space that fosters brilliance.”
Strategic Advantages for Businesses
Beth Moore, Head of Strategic Growth at Raise Commercial Real Estate, highlights the strategic benefits of flex spaces. Companies are leveraging these environments to test new markets, pilot innovative ideas, and align workspace arrangements with employee preferences. The wide array of flexible options, desirable locations, and cost-effective solutions make this model indispensable for forward-thinking businesses.
Flexibility Commands a Premium
Alex Snyder, Portfolio Manager at CenterSquare Investment Management, notes that flexibility has become a prized asset in today’s unpredictable world. Companies are willing to pay a premium for spaces that allow them to pivot and grow with ease. This willingness underscores the immense value of adaptability in contemporary business strategies.
WFH vs. Flex Work Varies by Location
Serge Vishmid, managing principal at Atlas Capital Advisors, emphasizes that preferences for flexible office space differ greatly depending on geography, even among the same clients.
For instance, in Northern California’s Bay Area, Vishmid notes that remote work remains dominant. Conversely, in Florida and Chicago, nearly all employees have returned to full-time office work. In Orange County, California, a hybrid approach is gaining traction as more employees gradually return to the office.
“…the model is very much remote work at this point, whereas in Florida and Chicago virtually everyone is back in the office full time.” —Serge Vishmid
Vishmid adds that the C-Suite expects most employees to be back in the office full-time within the next 18 to 30 months, indicating a long-term shift toward increased in-person collaboration.
The Future is Flexible
The rise of flexible office spaces reflects a broader shift toward a more dynamic, employee-centric approach to work. As businesses and workers navigate a hybrid future, flexible spaces will play a pivotal role in fostering collaboration, innovation, and growth. This trend is not just reshaping real estate but redefining the way we work.
Flex Space Gains Momentum in a Hybrid Work World
by:Paul Bergeron Sept 16th, 2022