Flexible spaces are currently consolidating themselves as an alternative for many companies, as shown by the growing demand for this type of product, which has increased considerably during the first months of the year. Thus, CBRE’s flexible spaces pipeline for the first quarter of 2021 already surpasses in more than 300% the entire volume contracted in 2020.
Besides the quick recovery of the demand for flexible spaces, its resilience in 2020 when compared to other segments, also stood out. «Although last year the number of traded flexible spaces decreased around 26% due to the pandemic, going from 17.827 in 2019 to 13.194 in 2020, this adjustment is much smaller than the one registered within the office segment (-50%), which shows the better behaviour the flexible segment had when compared to other segments», explained Jesse Derkx, director of agile practice at CBRE España.
In terms of the whole country, occupancy went from around 71% in 2019 to around 62.6% in 2020. Along with good demand for flexible spaces, we can also forecast an important recovery for the coming months.
«Flexible spaces are proving to be an option for the present and for the future, which is very attractive for companies, particularly during these times of uncertainty, since they can adapt to other needs quickly and without investing in fitting them out, while offering additional full contract flexibility», commented Alfonso Galobart, CBRE España’s vice-president, head A&T CBRE Continental Europe and head agile CBRE EMEA.
Due to this, flexible spaces have gained weight on companies’ plans, and the number of companies interested in adopting flexible spaces grew during 2020. According to the Global Occupier Sentiment Survey from CBRE carried out at the end of 2020, in September 86% of multinational corporations anticipated that flexible spaces will play an important role in their long-term activity, going from around 23% in June to 36% in September last year.
Galobart explained that «seeking to have the work place be adapted to their workers and not the other way around, corporations will need to adopt Hub and Spoke strategies, that is, maintain its central offices within the cities’ financial districts and satellite offices in the residential areas where their clients live».
According to data from CBRE, almost half (47%) the spaces will correspond to less than 20 jobs, followed by 26% of demand, needing up to 70 jobs. On the other hand, those who seek very wide spaces which can support more than 500 jobs, represent only 8% of demand. The remaining 19% of the expected demand will be need between between 100 and 500 jobs.
Factors which motivate interest for flexible spaces
Savings are one of the determining factors for flexible spaces’ occupants. According to CBRE’s Global Occupier Sentiment Survey de CBRE, around 52% of respondents expected to reduce capital costs. Another attraction for this segment is that, for around 44% of those surveyed, flexible spaces is the option that welcomes new work models, such as the Hub and Spoke strategy. This study also showed that 70% of occupants demand from their flexible spaces’ operators a safe work environment.
«Given the extended remote work experience during the pandemic, it is not hard to imagine a world where the worker can choose when to work from home to be more productive, with no need to spend five days a week always in the same place. This flexibility will allow the employees to work from different places, but always within adequate surroundings, to ensure his safety and productivity», highlighted José Mittelbrum, senior office director at CBRE.