Flexible Workspace Industry: Accelerating the Road To Market Recovery
With the onset of the hybrid work model, organizations are planning for workspaces where they can scale up and scale down with ease accommodating new work cultures and schedules
The last 18 months have been disruptive in many ways, with the constant rise and fall in COVID-19 cases, changing market dynamics and economic uncertainties. This has been a trying period for organizations challenging them to adapt rapidly and strategize business continuity plans on the go. Companies with agility built into their business have been the ones to thrive in this period.
Organizations across sectors had one common goal this last financial year, and that was to make capex efficient in every aspect of the business. This has led large corporations from different industries to reassess their real estate holdings, both long term and short term. One-and-a-half years back when organizations decided to switch to work-from-home, it was a short-term contingency plan. However, the perception has now changed, and companies are looking at multiple options to get the best of virtual and physical workforce collaboration along with accelerating their market recovery through asset management. With the onset of the hybrid work model, organizations are planning for workspaces where they can scale up and scale down with ease accommodating new work cultures and schedules. The flexible workspace industry seems to be the obvious choice for most businesses who want agility in their business operations.
The recent report by Cushman and Wakefield shows that in H1 2021 there is a sharp 73 per cent rise in corporates demand for flexible workspaces. Enterprises had leased 18,213 seats in the first six months of the 2020 calendar year and 36,255 desks during the entire last year. However, in the first half of 2021, the number of flex seats leased crossed 31,538, that's 87 per cent of the seats leased, already compared to the whole of 2020. There has been a sharp uptake in the flexible workspace model, with companies looking for grade A buildings and flexible options as part of their office portfolio. Companies are changing the way they take up space and adopt a flex-and-core strategy, which is a model that can be tailored to suit the size and needs of the organization. Companies will rely on flex space as they plan to transition to new floor plans and socially distant workplace policies. This leads us to believe that most companies will take on a hybrid model with a flexible structure even in 2022 as we see privacy and convenience taking precedence.
Given the current standards for the new normal, the flexible workspace industry has become more relevant than ever. The ease of getting back to work is going to be a key factor of market recovery in this financial year. The rise of the second wave in March of this year was detrimental to the economy and now that we are seeing a steady downward trend in cases, there are only two priorities for businesses. One is to accelerate market recovery, and two is to ensure safety so we do not have a hard-hitting third wave. The agility to take up multiple seats in different touchpoints across the city allows an organization to get back to work faster. Giving their employees the option to step into work at the closest centre and cut commute time as well. This not only allows the workforce to balance coming into the office and work from home, but it also mitigates risk for the companies.
However, the flexible workspace providers need to meet the moment with expertise and empathy. The offices need to meet global SOP's put in place by large MNC's for privacy, security, maintaining company culture and identity. The new age of flexible workspaces can no more be defined by large common areas and social infrastructure. The focus needs to shift to quality, higher service standards, lower density floor plans, and controlled privacy. Flexible workspaces are not a temporary solution but a paradigm shift in corporate real estate, which has been long overdue. The industry needs to cater to the needs of global giants ensuring that the economic benefit of this model also comes with protecting the organizations individuality and company culture. There needs to be a balance between shared space and privacy. If our industry steps up to this opportunity, we can collectively speed up the road to economic recovery and establish an undeniable new chapter in commercial real estate.