Research by commercial property firm CBRE found that 95% of commercial landlords expect flexible office space to soon be a mainstream investment product. Nearly four in five (79%) of the landlords surveyed are launching flexible office space in 2019.
Flexible office spaces are office buildings where landlords rent out serviced and fully equipped business space to a number of tenants on a flexible basis. Tenants do not have to commit to long leases and can rent just one desk, or a whole floor. They are popular with startup companies who like the ease of being able to rent more space in the same building while their business and their staff grow.
Property investment specialist Isabelle Scemama summarised the new attitude to office space:
“All tenants across all industries are changing the way they look at their premises. They want more flexibility and want to be more agile. They also want to take a smaller number of square metre.”
Landlords like this new model. Even though tenants may not sign long leases, developing good relationships with tenants often means that they stay with the landlords as their need for office space increases.
Landlords that want to convert existing buildings to flexible office space may need to upgrade them by adding excellent quality office furniture, staff amenities such as gyms and eating areas, and high-speed broadband. This can be financed through bridging loans or by remortgaging the property. Commercial mortgages are also available for purchasing new commercial property and converting them to flexible office space.