Editor: News that banks are refusing to lend on portfolios that are heavily weighted towards retail is indicative of the continued evolution of the high street. In 2020 alone, year-on-year retail footfall dropped by more than 40%.
Conversely, a different asset class has been growing in popularity. The flexible workspace sector continued to grow by 4% last year despite the pandemic and, with 85% of working adults wanting a hybrid approach to working in the office, it is clear that flexible working is here to stay.
For retail landlords, this offers a clear opportunity to capitalise on booming interest in the flexible workspace sector. By converting retail assets to flexible workspace, owners are able to futureproof their portfolios while also helping to drive renewed retail footfall – rejuvenating the high street through greater diversity of amenities and economic activity.
However, while the benefits are clear, retail landlords must consider several important factors before making the switch to flex. For example, evaluating the space a landlord has to offer is key. With 73% of workers aged 25-34 looking for a higher-quality office to tempt them away from WFH life, the fit-out and design of a flex space will be of paramount importance. Landlords must ensure their space offers this in order to thrive.
Ultimately, technology must be a landlord’s first port of call when making the switch to flex. With hybrid working taking hold for the long term, connecting the new workforce must be a priority.
A recent survey found that 16 million working days were lost over this year due to internet outages. Offering rapid and reliable multi-user connectivity will be a key draw for businesses and workers returning to the office and will ensure a hybrid workforce is fully integrated.
As online shopping continues to grow and retail spaces continue to experience declines in footfall, the flex sector can offer landlords an exciting opportunity to build greater resilience into their assets.
However, the right considerations and technology will be the key to ensuring this transition is a success.
Richard Morris, director, technologywithin