FLEXIBILITY...THE NEXT FRONTIER?

LOOKING TO THE FUTURE, TENANTS EXPRESS A DEMAND FOR FLEXIBILITY


The rapid recent growth of co-working operators prompted us to ask tenants about their needs for greater flexibility in lease terms. This is not exactly a property management issue, as it is determined by negotiation between landlord and tenant. However, property managers are key to making flexibility work. The survey shows an elevated level of demand for flexible terms of occupation: 55% of survey respondents want this in some form. There is some variation between sectors: Flexibility is most valued by office users (57%) and least by industrial users (39%).

55% of office and industrial tenants want some form of flexible occupation terms.

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Of the three types of flexible occupations, the highest demand is for serviced offices (26%), then shorter-term leases of the traditional type (24%), then co-working (20%). Other CBRE research suggests, (2018 Occupier Survey) that the demand for co-working could even be higher than this.

Among office tenants, flexible space has greatest appeal for APAC respondents, with 83% interested in at least one form of short-term leased space. This was followed by EMEA (56%) and Americas (48%).

Retail respondents in general are slightly less interested in flexible space. Of the three options, shorter-term leases for existing space is the most popular option (23%), followed by temporary additional space (18%). Just 13% of retail respondents value kiosks in common areas as a short-term option.

For more insight and guidance on the agile workplace, explore the CBRE Agile Real Estate Knowledge Hub

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