Corporate Real Estate (CRE) professionals are moving with the times and reaping the benefits of flexible office space.
Flexible workspaces, flexspace – or “office hotels” – are rapidly gaining traction across the globe, with IWG steering the ship as market leader.
Office hotels and co-working are not a new phenomenon but as the flexible working revolution builds in momentum all over the world – with companies allowing more employees to work remotely – the trend has accelerated in recent years. Corporations and large businesses are making the move to flexspace as they’re finding it’s a more intuitive, efficient way to manage their property portfolio. In fact, real-estate consultant Jones Lang LaSalle (JLL) predicts that large businesses (rather than startups) are set to account for the most growth within the flexible workspace sector.
Larger businesses and multinationals also need the chance to grow or shrink their team sizes depending on market conditions, especially in an uncertain global economic climate. And it also allows them to be more agile in either changing where their teams are based, or choosing to allocate different departments in different areas of the same city – a company’s engineering team and a sales team, for example, may be more productive working in different workspaces.
The flexibility of office hotels helps keep companies’ overheads down. This is partly because they offer the option of shorter leases, and the chance to upsize or downsize the amount of space they use depending on changes to staff numbers or business outlook. Compared to conventional office space, where businesses often find themselves locked in to a set workspace for a set amount of time, they consider how fluctuations can affect growth plans, and give the flexibility to make changes.
According to Klaus Koponen, Country Manager for Finland at IWG, businesses typically sign an initial contract for a 10- to 12-month period – but many end up staying much longer. Taking the nation as an example, he reveals that, in six years, the brand has gone from operating three office hotels in the country to 30. “Helsinki Metropolitan area is clearly the most attractive location,” he says; “IWG plans to move into cities with over 100,000 inhabitants. IWG's goal in Finland is to open four to five new office hotels per year.”
What does it mean for employees to use flexible office space rather than conventional workspace? For a start, flexible office space tends to be newer and more intuitively designed than decades-old office buildings. And while it often comes with co-working areas – think a good amount of buzz, where people can collaborate – IWG’s locations also offer the option of private offices within the same space. This means that large companies can enjoy the privacy and peace they require while also benefiting from the community atmosphere of the office house’s communal areas if they wish. So in terms of the day-to-day environment for employees, there’s the same level of professionalism as a conventional office set-up but with quality infrastructure guaranteed, a community feel, and staff on hand to take care of the building and to work on reception.
What about the real estate market? According to JLL, 30% of all global commercial real estate across the world will be flexible office space by 2030. Essentially, flexible workspace is becoming the new normal. The potential for conventional office buildings to adapt, renovate and move with the times is there. In order to stay competitive, next-generation workspace needs to be more flexible and in tune with the way people are working.
Find out more about the benefits of “office hotels” – or flexible workspace – for businesses.