Workthere survey reveals uptick in confidence in flexible office sector
In its second sentiment survey of flexible office providers from across the world, Workthere found that 42 per cent of respondents are now positive about the prospects for the next three months, compared to only 25 per cent in April.
The survey also found that 74 per cent of those surveyed are positive about the next 12 months compared to only 64 per cent for the previous month. In the UK specifically, this figure stood at 85 per cent.
The flexible office specialist also found that enquiries into new flexible office contracts have recovered since last month; enquiries have seen a 40 per cent rise month-on-month globally. In Europe the rise has been 77 per cent, Asia 17 per cent and North America is the only region to have reported a month-on-month fall.
With regards to occupancy levels, the survey showed that respondents expect global occupancy to be 69 per cent at the end of June, compared to the 83 per cent pre-Covid-19 figure. Providers in the UK are expecting a similar fall in occupancy, but this would be coming from a higher base, with the survey showing they expect occupancy levels to be 77 per cent by the end of June, compared to the 92 per cent pre-Covid-19 figure.
Jess Alderson, global research analyst at Workthere, says: “Our second sentiment survey shows that globally, there has been a positive uplift in provider attitudes towards current market conditions. With over two-fifths of respondents stating that they are optimistic about the prospects for the flexible office market over the next three months. We are starting to see an uplift in enquiries, which is a step in the right direction.”
The survey also showed that 31 per cent of members have asked for rent relief, with this number at 38 per cent in Asia, 33 per cent in North America and 28 per cent in Europe. The most common forms of rent relief are still: (1) deferring rent for a month and extending the licence agreement, (2) allowing members to downsize their space and (3) 20-50 per cent rental discount for one month.
Cal Lee, global head of Workthere, adds: “It has been very encouraging to see a shift in attitudes both in the short and longer term, not just in the UK and Europe but further afield too. While there is a general trend towards an uptick in enquiries, we are also seeing a surge in interest for suburban flexible office space with 37 per cent of flexible offices saying that they are seeing most demand for these particular spaces.
“With more people realising the benefits of not commuting to a city centre, but wanting a quiet space in which to work with the infrastructure of a normal office space, we anticipate the percentage of suburban enquires could rise even further. Swing space (a temporary working environment) and extra space needed due to social distancing are other key sources of demand at the moment.”
Workthere’s Flexible Office Provider Sentiment Survey collated 90 responses from a variety of providers in 12 countries across the world to understand their position and plan moving forward, as well as their sentiment on what the short and long term picture looks like for flexible offices.