{"id":3680,"date":"2021-11-17T16:54:01","date_gmt":"2021-11-17T16:54:01","guid":{"rendered":"https:\/\/www.yardikube.co.uk\/?p=3680"},"modified":"2026-04-02T12:03:58","modified_gmt":"2026-04-02T12:03:58","slug":"the-ever-changing-relationship-between-commercial-real-estate-and-flex","status":"publish","type":"post","link":"https:\/\/www.yardikube.com\/en-gb\/blog\/the-ever-changing-relationship-between-commercial-real-estate-and-flex\/","title":{"rendered":"The Ever-Changing Relationship Between Commercial Real Estate and Flex"},"content":{"rendered":"\n
Yardi\u2019s Paul Orrock hosted a discussion alongside Abigail Groves from The Instant Group, Rob Stevenson from Techspace and Jonny Rosenblatt from Spacemade about the ever-changing relationship between commercial real estate and flex at GCUC Flex Fest 2021.<\/p>\n\n\n\n
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As the traditional office continues to move towards hybrid ways of working, what does this mean for the future of commercial real estate? Paul opened the discussion by asking the group, what are the barriers of entry to flex from a traditional landlord perspective?<\/p>\n\n\n\n
Rosenblatt began by stating it is doable. \u201cI think landlords are able to enter this market, but fundamentally it is a totally different business model,\u201d said Rosenblatt. He continued to explain how real estate owners don\u2019t have the infrastructure but, \u201cReal estate is probably one of the very few industries where you can have a multi-billion pound business and actually only have six guys in an office running them.\u201d<\/p>\n\n\n\n
He described how with flex, it\u2019s about the product development and building a brand as well as technology integration. It\u2019s about the cost of the journey and the customer experience, which is \u201cvery different to what a traditional real estate angle may look like.\u201d<\/p>\n\n\n\n
As customer demands have changed over the past decade, they\u2019re wanting to utilise a space in a way that\u2019s more akin to regular consumer habits, such as how we consume films and music on-demand. Rosenblatt added that, \u201cFlex is very well set up for this major dynamic shift towards hybrid working that perhaps the commercial real estate world traditionally is not.\u201d<\/p>\n\n\n\n
Groves added, \u201cIt\u2019s not necessarily about being a big brand in a particular way, it\u2019s the ownership of brand that brings communities back to your sites. It\u2019s knowing what you want to be in the market and where you want to service.\u201d<\/p>\n\n\n\n
Hybrid working encourages smaller offices<\/strong><\/p>\n\n\n\n
The conversation moved to life post-pandemic, what are people looking for with their workspaces? And how has that changed from what they were looking for before?<\/p>\n\n\n\n
Groves said, \u201cTwo years ago the headlines were saying \u2018the office is dead\u2019, and now the patterns are showing clients moving to hybrid working. Some people were really pushing to get back into the office, and we\u2019ve seen a spike in one to three desk offices, but for big corporate clients.\u201d<\/p>\n\n\n\n
Groves continued to explain how their clients are valuing being able to get together and have somewhere else to work with a good quality of space. However, she believes in another 12 months \u201cWe\u2019ll be looking at very different patterns again.\u201d<\/p>\n\n\n\n
Stevenson agreed and stated, \u201cWe\u2019re seeing much larger requirements for smaller spaces, a good example is last week we closed a deal with a 500-person company in our Berlin office. They\u2019ve taken space for 100-people. We\u2019ve never seen these kinds of ratios before, and the question is, is this a permanent shift or is this just for the next 6 months as people figure out what the office looks like?\u201d<\/p>\n\n\n\n
Retail units convert into flex spaces<\/strong><\/p>\n\n\n\n
Orrock described how banks are shying away from retail only investments, so how will operators or landlords mix up their offerings? Rosenblatt believes, \u201cTraditional retail units aren\u2019t generally suitable for a working environment.\u201d However, Spacemade recently converted an old pizza express unit into a flex office which has been widely successful. Rosenblatt specified that the unit has natural light \u2013 something retail units don\u2019t often have, which may be an issue with traditional retail units, \u201cNo one wants to sit somewhere where there\u2019s no natural light coming in.\u201d<\/p>\n\n\n\n
Groves agreed that retail units are often overlooked, but with the right space and the right operator, it can work and be a great location for a flex office. However, it is a case-by-case basis, but something that shouldn\u2019t be ignored.<\/p>\n\n\n\n
The biggest challenges of entering the flex space<\/strong><\/p>\n\n\n\n
It may still be too early to decide how the future of the office will look, but one thing for sure is that the future is uncertain. Groves believes the market will change again in another 12 months, but what will remain the same is facilitating the needs of the client.<\/p>\n\n\n\n
Rosenblatt believes it\u2019s finding the right people, \u201cWith a difficult hiring market and lifestyle changes, it can be hard to find the right team that share the same mentality, ethos and are passionate about flex\u201d, whereas Stevenson believes it\u2019s site selection.<\/p>\n\n\n\n
\u201cYou need to choose the right sites and make sure you\u2019re disciplined about where you go about growing your business. If you make the wrong decision on your sites – you\u2019re stuffed – and it can cause a lot of trouble for you.\u201d Where and how we work is changing and by embracing flexible workspaces, you can continue to support the demands of your consumer.<\/p>\n\n\n\n
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