By: Melanie Jones, CORT Workplace Regional Business Development Executive
The commercial real estate industry is changing rapidly. As internet connectivity has improved, there has been an accompanying rise in demand for more flexible work environments. In fact, a 2017 Gallup report, found 43 percent of American employees had spent at least some time working remotely. And given that evidence from other studies suggests that remote work can boost productivity and help retain employees, more and more companies are beginning to adopt a flexible work environment.
As a result, flex space is a topic that comes up more and more often in conversations surrounding commercial real estate. But what is it, and how can it make your business more competitive?
What is Flex Space?
Flex space is a term that refers to commercial real estate spaces that can be used for short periods of time. Unlike traditional commercial leases that are three to five years long, flex space provides access to offices for months or weeks, and even sometimes by the day.
Who Needs Flex Space?
The need for flex space arises from changes in the way people work. There are fewer employees sitting full-time in corporate office spaces every year as more employees choose to work remotely, or come into the office only a few times a week. That decrease may translate to a lower demand for long-term commercial leases, but people still need a place to work. As such, there is still a demand for office space – only the terms have changed. Access to that space needs to be flexible in order to accommodate more flexible working styles.
Enter the coworking movement. Because coworking spaces provide affordable, short-term access to office space, many small companies initially turned to coworking to address their need for office space. However, those same start-ups, early stage, and small companies are now outgrowing what we have come to know as the typical coworking environment. This is a flat-out reality.
Often growing firms, or those who are not sure what the future holds, are looking for next step options for teams of 20-50 employees. What options do they have other than a standard long-term commercial lease, and all that work that goes into that process? Not much, but things are changing. Demand is growing and innovators in the commercial real estate space are capturing this new market segment.
Who Provides Flex Space?
Industry pioneers such as Breather, LiquidSpace and Swivel are creating and marketing new ways for users to find and book commercial space. Breather, with their app driven interface, provides a network of move-in ready office spaces, designed with the needs of businesses and professionals in mind. Workspaces are available for hours, days or months. LiquidSpace, on the other hand, focuses on connecting growing teams and professionals looking for space directly with venue partners and space providers. In addition, there is Texas–based Swivel, which has created a program featuring an online option where fast-growing companies can find and design their own plug-and-play workspace and pay for it on flexible terms.
As Space as a Service (SaaS) emerges, there will continue to be more progressive ways to service this booming segment of the workplace population. Some commercial real estate partners are catching on to the vision of what CORT has termed “Flex Space On Demand,” or strategic vacant space marketed as a ready to roll, short-term flex space, that provides the continuity and turnkey solutions many companies have come to expect.
Flex Space Requires Flexible Furnishings
Pairing the SaaS concept with other fast and flexible necessities is critical. Furniture as a Service (FaaS) certainly fits the bill, as the furniture is easily reconfigurable, exchangeable and modifiable within a few days. Quickly flipping the switch for internet, phones, security, parking options and support services are obviously key as well.
These ideas are a pivot from long held perceptions of how the real estate cycle works, but this pivot is critical. Changes in commercial real estate are happening before our eyes, and we must adapt our operational flexibility to stay in the game. To quote Drog Poleg of rethinking.re:
“Stability is no longer a virtue. Flexibility is key.”
Melanie Jones is an industry leader on the CORT Workplace team. Her mission is supporting change in the way furniture is used in the workplace with CORT’s Furniture as a Service (FaaS) subscription-like model.