Most major property owners would now understand the value of providing flexible workspace to tenants in their office buildings, what should they consider when integrating flex into their portfolio?
As the flexible workplace industry continues to grow and the market recovers, what do landlords need to be thinking about when revisiting their tenant mix and should they consider increasing the flexible workplace's share in their portfolio?
How to begin integrating Flexible Workspace into your portfolio
Undoubtedly, most major property owners would now understand the value of providing flexible workspace to tenants in their office buildings. The starting point and most significant decision will be to determine how to set this up, which I would like to put into three broad buckets:
1) To simply outsource to a 3rd party operator through a simple landlord/tenant relationship,
2) Create a partnership with a 3rd party operator where in effect, it is a jointly owned business or,
3) For the landlord to operate themselves.
In Singapore, quite a few major landlords are now choosing to run their own co-working brands. However, operating a flexible workplace centre may turn out to be labour intensive and require different expertise from what most developers have in-house. Therefore, some owners may quite possibly revert to the outsourced model over time.
Factors that affect Flexible Workspace integration
Another critical point is assessing how a developer integrates flex into their new development. We are starting to see some good examples of this in Singapore, such as the upcoming development - Guoco Midtown. We can expect developers on future projects to put the same design focus on the flex component as the other key features such as the F&B amenities. Some of the considerations will be around the location of the flexible workplace in the building, how it flows with the office community, integration with technology and brand choice.
Ultimately, the success of a co-working centre is determined by the sales and demand generated by the operator. The bigger corporates tend to navigate to a few key global partners for co-working, so if it is an asset looking to attract these types of occupiers, owners may want to closely assess each operator's sales platform and their customer pool.
Interested in finding out more about flexible workspace? Listen to the full Colliers Singapore Property Insights Podcast – episode 5 | Flexible workspace in focus (10 minutes) below.
You may also like:
- Flexible workplace | Watch this space
- Property Insights Podcast: Flexible workspace in focus
- Expert spotlight: Patrick Gidney, Senior Director, Occupier Services
Liked what you read? Subscribe to our mailing list for more thought-pieces on the latest in commercial real estate.
Contact our Colliers Editorial team here.