Flexible Office is No Longer Just for Small Business

Russo: “The thinking is changing, from a discreet offering of offices to broader flexibility for a building or portfolio.”

BROOKLYN, NY—Flexible and co-working space used to be mostly for startups, freelancers and small businesses, but these days, large enterprise users are leveraging flexible, serviced offices to drop in corporate teams in new markets, Common Desk‘s CEO Nick Clark tells GlobeSt.com. Clark will be speaking on the panel for the session “Mix it Up: Integrating Flexible Office Space” during The Office Evolution conference here in November, and Jamie Russo, executive director of Global Workspace Association—which recently partnered with NAIOP to host the conference—will be moderating the panel. We spoke with both of them about the commonality of flexible office space in today’s CRE environment, where this trend is heading and how owners can make room for it in existing buildings.

Clark: “I fully believe that within the next five years, the number of companies that will need some sort of flexibility within their real estate will be at 100%.”

GlobeSt.com: How common is flexible office space in today’s CRE environment?

Russo: In markets such as Denver and New York City, flexible workspace has grown over the past 10 years to about 1% of commercial office space. Flexible office is a shift that demonstrates how consumer-driven some markets have become; this is not just a fad, but a trend. It’s a shift in how the end user expects commercial real estate to work. We see flexible office adoption most quickly in dense, urban markets and CBDs but it is also moving into smaller-tiered cities along with more suburban locations. I certainly think partnership opportunities between landlords and shared workspace operators could be greater in non-urban areas because in cities like Manhattan and San Francisco, building owners may prefer to continue to lease to high-credit, long-term lessees while owners in smaller markets may be willing to get more creative and adjust more quickly to the shifting demand model.

Clark: We’re seeing more and more companies that are needing some level of flexibility as it pertains to their office space. Most people think that flexible office is on a linear growth projection, but we at Common Desk think it’s exponential.