To those of us who work within the flexible workspace sector, increasing landlord interest in our market was inevitable. The question was not ‘if’ but ‘when’. And Richard Williams’ recent piece shows, the time is definitely now.
The broader property market is finally addressing corporate customer demand and looking at a product that is better aligned to new, more agile ways of working. From our perspective, the provision of flexible solutions by landlords represents a long-overdue and significant shift in the property market. The real question now is: how will they adapt to a market that already successfully meets much of this demand from customers and is highly adept at doing so?
Occupier demand for flexible space has risen by double digits every year for the past five years. Supply to the market has grown rapidly, too. It is a diverse and fragmented sector – more than 90% of flexible space is supplied by operators that run only one or two centres.
What the existing market does very well is provide choice – operators have spent years honing their products, understanding demand generators and tailoring their space to specific requirements. In short, they do something very well – operators provide excellent customer service.
The flexible workspace market provides space to clients on their terms – flexible pricing, length of stay, choice of location, buying online and, yes, even free beer. This is the fast-moving end of the market where the customer (not the tenant) is always right, and the end product has been created for a specific user base.
With new landlord and conventional entrants into flexible space, it will be very interesting to see how they adapt to this more consumerised market. This is a digital marketplace, one that is highly transparent and data-led and where price comparison is easily available. The market is highly competitive and client-focused. That may come as a shock to those dipping their toes in the water for the first time.