What’s on your flexible workspace radar in 2018?
If last year is anything to go by, we can expect more growth from our industry as forward-thinking operators and suppliers continue to identify and act on new opportunities. Despite a lack of clarity around Brexit and our ongoing battle against unfair business rates, our industry is in excellent shape and the flexible workspace revolution is continuing to gather momentum.
As for 2018, what does the immediate future hold? In January, Property Week interviewed a number of experts from the wider property industry to learn their expectations for the year ahead. Here, we identify 7 of the most relevant insights that will impact our sector in 2018:
1. The Brexit cycle:
We’ll say the ‘B’ word only once. Regarding Brexit, Pat Gunne from Green REIT believes it will be priced into real estate values sooner or later and advises: “Be patient as the cycle plays out - as it always does.” Gunne also makes an interesting point regarding Ireland: “We are starting to see an influx of foreign companies that would normally have gone to the UK as their first port of call, but are now forced to look elsewhere to access EU passporting.”
As noted at last year’s Coworking Europe Conference held in Dublin, the Irish capital has enjoyed a resurgence in recent years, with one report suggesting that Dublin’s serviced office market has grown 43% between 2015-2017. A number of operators are set to expand their flexible space in Dublin this year, including WeWork - which will make its Irish debut with two new locations.
2. Increasing appetite for flexible workspace:
Jamie Hopkins, BCA Member and Chief Executive of Workspace Group, says Workspace is on the expansion trail this year “in line with increasing customer appetite for flexible spaces”.
He added: “We are seeing a behavioural shift from occupiers, with organisations of all sizes demanding more flexibility from their landlords. I believe more traditional landlords will be looking to try and keep up - or catch up - by launching or attempting to grow a more flexible offering this year. In a crowded market, the landlords that will succeed are the ones that are attuned to what occupiers need and can adapt quickly as and when those needs change.”
3. How’s your connectivity?
Another insight from Jamie Hopkins relates to building connectivity and the resilience of telecoms infrastructure, which he says is of paramount importance to clients. As such, Workspace uses WiredScore to evaluate and improve the infrastructure of its buildings, and will “continue to roll out WiredScore certifications across our portfolio” at Gold standard or above.
William Newton from WiredScore commented that workspaces “need to provide not just the space but an environment for success”, which he believes will lead to greater acceptance and take-up of new technologies such as smart buildings.
Indeed, such is the importance of connectivity and Internet reliability that it was discussed in-depth at last year’s BCA roundtable conversations. As technology advances and occupier needs continue to evolve, this topic will remain firmly on the agenda for future roundtable conversations. More details here.
Pictured: Workspace Group's Metal Box Factory, which was awared WiredScore's highest Platinum rating.
4. Expect more inroads from traditional landlords:
Flexible workspace operators and suppliers may have been working diligently for the past three decades to build a service-led solution that’s flexible and supportive for businesses in a changing market, but it’s only in recent years that the wider property industry has sat up and taken notice.
George Roberts, Head of UK & Ireland at Cushman & Wakefield, said: “Political, economic and technological ‘plates’ don’t move in predictable lines and therefore we need to be flexible in how we react. It will be key for our industry to come up with solutions that support investment decisions and instil confidence.”
Roberts noted that 2017 produced “a substantial increase in activity within the office-as-a-service sector, with record levels of take-up” - and expects more of the same in 2018. For operators, the message is clear: flexible space is in vogue, and our industry is set to become more competitive as traditional landlords take advantage of increasing demand for workspace flexibility.
RDI REIT’s acquisition of four serviced offices in London from Office Space In Town is just one example - and we can expect much more of the same in 2018.
5. Coworking, co-living, co-operation:
Ken Shuttleworth, founder of Make Architects, added: “I think we’ll see much more around the issues of wellness and their natural spin-offs into coworking and co-living as we look to create inspirational, comfortable and adaptable places in which to work and live.”
As noted by Shuttleworth, collaboration is happening at every level; our workspaces are facilitating greater co-operation and teamwork, which in turn is generating greater demand for intuitive, design-led spaces. “It is fascinating how technology is playing such a role in shaping our built environment, and collaboration to design buildings and spaces will become ever more important to facilitate this.”
6. Future-proof your offering for long-term gain:
Charlie Green, co-founder at The Office Group, recognises the opportunities that corporate clients bring, but warns against complacency as large firms naturally move towards long-term options: “The biggest change will be increasing use of flexible space by traditional corporate occupiers as they recognise the benefits of agile working and the economic saving flexibility can deliver. But this will only work in the medium to long term if buildings can future proof against demand shifts, catering to smaller audiences in tough economic climates, when corporates may retrench to core space.”
Pictured: The Office Group, 201 Borough High Street
7. BCA Members plan for expansion:
The Office Group is one of several BCA Members gearing up for expansion this year. For TOG, this may also involve stepping outside of UK borders: “We hope to continue to find great buildings to create brilliant workspaces - whether buying, leasing or partnering - in the right UK cities and, for the first time, internationally.”
Gareth Evans - Chief Executive of BizSpace - commented that the flexible workspace market is “a fast-growing asset class” and noted “impressive resilience” from the SME market, and expects major regional cities such as Bristol, Manchester and Leeds to continue driving demand this year.
David Saul, Managing Director of BE Offices, also noted significant activity from SMEs despite the hindrance of wider political and economic factors - and expects this trend to continue in 2018. “I believe smaller companies will take full advantage of the rapidly growing flexible workspace market,” he said. “I expect Britain to continue to lead the TMT sectors and we will see even greater numbers of start-ups during 2018.”
Looking ahead to 2018 and the myriad of challenges and opportunities that await us, the BCA will dive deeper into the shape of things to come at this year’s BCA Conference and Exhibition. Join us on Tuesday 15th May 2018 for a day of learning and discovery, as leading business and workplace experts share their knowledge to help operators grow and stay ahead of the curve.
Reserve your place here: https://www.bca.uk.com/events/bca-conference-2018
Image top: BE Offices, Paddington