Flex Real Estate: Why CRE Brokers Should Promote Flexibility
Following two years of heavily shifting market dynamics, workplace trends are on track to further diversify throughout 2022 and beyond. In the wake of the pandemic, remote work has taken center stage, prompting owners, asset managers and operators to reassess their strategies — and emphasize flexibility in the workspace.
In 2021, the market share of flexible real estate grew as companies adjusted their work policies to accommodate changing employee preferences. And, according to a recent office report from CommercialEdge, the flexibility that shared space provides is expected to play a key role going forward in attracting and retaining talent in a tight labor market.
Why Brokers Play a Vital Role
Considering the rate at which flex space continues to gain ground, commercial real estate (CRE) brokers are in the perfect position to promote flexible space solutions and further benefit from the sector’s momentum.
While flex space is not a new trend, the pandemic has accelerated its adoption as companies had to quickly adapt to new market conditions. What’s more, the switch to remote work has transformed the office landscape, bringing hybrid work configurations to the forefront. Consequently, brokers who have a comprehensive understanding of the market and their clients’ needs are well-positioned to facilitate the transition to a hybrid work environment.
At the same time, as employers increasingly adopt this new strategy, a broker’s role is essential in helping companies identify their workplace needs and presenting the available alternatives and solutions that match their requirements. Accordingly, to determine the best formula, brokers should encourage clients to initiate conversations with their employees about workspace preferences.
Flex Space’s Strong Points
From the broker’s — and the client’s — perspective, deals involving flex spaces are often made at a faster pace than traditional leases because flex space agreements are typically short-term, unlike traditional long-term leases. This can then pave the way for long-term collaborations, which can enable brokers to establish long-lasting relationships with clients in search of temporary solutions — and returning clients equal recurring commissions.
Additionally, considering that flex space is regularly move-in ready, turnkey office space significantly reduces costs for the client — as opposed to traditional leases, in which a company might spend considerable time and funds to outfit the space before taking occupancy.
From the employees’ perspective, a flex office operation means more workspace options and being able to focus on productivity in an environment that matches their needs. Whether the company’s strategy involves a hub-and-spoke model with one central office and smaller satellite offices closer to where employees live; a hybrid configuration with a hot desk system; or office hoteling in coworking spaces, flex work strategies should emphasize employee well-being — a crucial factor for attracting and retaining top talent.
To that end, one of the benefits of a flexible work model is a reduced or eliminated commute, which not only gives employees more personal time and a much-improved work/life balance but also marks a fundamental move toward a more sustainable future.
Useful Tools to Note
Regardless of office configuration — whether it’s shared space, coworking or another model — today’s workspaces must include proper safety measures that both enhance and streamline the office experience. Specifically, automation, touchless technology features and mobile apps are fundamental elements in today’s work environment.
As such, software that facilitates operations is essential in a flexible work environment: The right platform should help operators manage the space to ensure proper social distancing, streamline bookings and optimize overall operations. Moreover, the user mobile app should allow them to make reservations, access meeting rooms, and establish clear communication channels among employees and with office staff.
For example, Yardi Kube, a centralized booking and management platform, enables landlords and operators to easily convert available spaces and fill vacancies with tenants who can move in more quickly. The software streamlines flexible office operations with easy communication and thorough occupancy analytics, including real-time access to information on space use, how many people are using it at a given time, who booked a desk and other useful features.
Similarly, Yardi Corom, a workplace management platform that includes desk hoteling for flexible spaces, facilitates navigating back-to-office protocols for occupiers and tenants. The office hoteling solution is scalable to any size business and serves as an internal occupancy tracking system that enhances employee safety and convenience. Additionally, the Corom suite also provides lease, transaction, facilities and construction management features.
Despite much speculation on the permanence of remote work, one thing is certain: Companies will still need physical space to collaborate, train and build company culture. Fortunately, flex space is a fitting solution to bridge the gap between the requirements of the present and the uncertainties of the future, as the CommercialEdge report highlighted. Subsequently, conveying the value of flex space is set to become a significant part of brokers’ business plans going forward.
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