The world is still devising ways to maneuver this unprecedented COVID-19 pandemic. Enterprises are grappling with the restrictions posed by nationwide lockdowns. However, in times of crisis, innovation molds the market and paves a way for businesses to move forward. Flex space is an example of an innovative organizational system that has altered the market dynamics in the real estate sector. Enterprises are now opting for hybrid models in office spaces to simultaneously ensure cost-effectiveness and efficiency. In its new report, CB Richard Ellis (CBRE) South Asia Pvt. Ltd revealed that India’s flexible office space market is expected to grow by 10–15% year-on-year over the next three years. Let us look at some of the reasons that account for the rising demand for flex spaces and their associated benefits for enterprises.
1. Cost reduction
The economic crater is yet to fill up, which is pushing enterprises to cut back on their finances. In this turmoil, flex spaces are turning out to be their knights in shining armor. Cost-effectiveness and affordability make flex spaces greatly beneficial during these unprecedented times. It is relatively cheaper and convenient for enterprises since they can collaborate and share the rental expenditure. This helps them manage their expenses and divert more resources into other aspects of their business to stay afloat. Cost-effectiveness is very significant among the startups and SMEs that are identifying ways to sort out their expenditure at this point. Since enterprises cannot afford hefty rentals and long-term leases of single office spaces, flex office spaces prove useful due to their low rental costs and higher return on investment.
2. Customization, specialization, and nichification
Flex spaces offer enterprises the liberty to organize and plan their work. The rising demand for flexible office spaces is due to the customization, specialization, and nichification of office spaces according to the demands of the enterprises. Now, enterprises have the liberty to work in a decentralized way from any part of the country due to work-from-home options. According to Naveen Nandwani, Managing Director, Commercial Advisory and Transactions at Savills India, “A hybrid model with a concept of work from anywhere has taken over, were employees are either working from their home or flexible office spaces.” Software as a Service (SaaS) companies such as ClickUp and Asana are offering virtual office management tools that keep track of the work progress in the firm and boost productivity in employees. The freedom of managing a decentralized office model was unimaginable a few years back. However, it is now possible with the help of flex spaces.
3. Flexible lease program
The flexible lease program is a significant advantage as it allows businesses to account for uncertain times. With single office spaces, the companies usually must execute rigid seven- to fifteen-year lease agreements, which make it difficult for companies to stay afloat. However, with flex spaces, the lease deeds are relatively welcoming for the companies since they can extend from a few months to as many years as the enterprise may deem fit. They also allow the enterprises to leverage their warehouse or office spaces when they need to expand or curb their operations.
According to Andrew Kupiec, the Chief Executive Officer of Hana, “The beauty of flex space solutions is how they’re tied to the line of sight you have and not any longer. If your business needs change and you find yourself in need of more space or less space, you have the flexibility to meet those needs accordingly.”
4. Ensure employee convenience and productivity
Flex spaces are supporting enterprises to manage employee convenience to ensure a better work environment. The work-from-home culture has burned out most employees. To tackle fatigue, using hybrid working models and investing in flex spaces is the way forward. Many enterprises are reaping the benefits of investing in flexible workspaces.
Accenture, a global consulting firm, has seen a surge in productivity after shifting to a flex space office model. Dan Johnson, Global Director of Workplace Innovation, Accenture, said, “Our flex work arrangement is one of the reasons people stay at Accenture and it has turned out to be very valuable and beneficial for us.”
Further, Mick Hollison, Vice President, Integrated Marketing and Strategy, Citrix, added, “Organizations are investing in flex space to create enticing workplaces that foster collaboration, innovation and creativity, resulting in a stronger organization with high-caliber people performing at their best.”
5. Offers safety compliances
In a bid to resolve the issue of on-site working problems due to the pandemic, flexible office spaces are adopting remote monitoring services to ensure adherence to safety protocols within the office premises. This increasingly effective trend is leading enterprises to opt for flex space. The remote monitoring services regulate and supervise every aspect of the office space with the help of artificial intelligence (AI) and deep-tech learning. AI startups such as Wobot are collaborating with flex space offices to ensure that all the standard operating procedures (SOPs) and safety compliances are followed.
“Enterprises are coming up with ideas and are substituting their present working model with a remote-first model. The reason is simple. They advocate the fact that a full-time remote workforce is not conducive for all employees in the long run. Every company understands the importance of a dedicated space for their employees to meet and work since productivity and in-person exchange of ideas are undeniably the key elements for a company’s growth,” says Georgia Collins, Executive Vice President of Client Solutions, Hana.
Flex spaces are filling this gap by going a step further and giving the organizations an option to adopt remote-first policies and transform their standing with the current market trends. They even go as far as to offer a network of workspaces inside and outside urban centers for employees to use. Moving forward with this idea, an enterprise adopting the right flex space can devise a unique hybrid working model for their employees to choose the workspace location that works best for them and is conducive to collaborative working.