Four out of five UK office landlords plan to increase their exposure to flexible workspace within the next three years, according to new research from Orega.
The flexible office provider said the research showed the sector had moved decisively into the mainstream as a core allocation. Across the 500 respondents surveyed, a third said they had up to 50% of their total office space held as flex, with 23.4% saying flex represented between 25% and 50% of their office portfolio.
This momentum is growing, with 81.3% of respondents saying they plan to increase their exposure to flex in the next one to three years; 28% said they would increase “significantly” and 53% plan to grow their exposure moderately.
This growth appetite is strongest in core city markets, Orega said, with 84% of respondents in London and 83% in Manchester targeting expansion. Among those with office portfolios of 1.1m sq ft to 5m sq ft, 42.4% said they would increase their flex operations significantly, compared with 28% overall.
Orega chief executive Alan Pepper said the findings pointed to a “fundamental shift in the UK office sector”, with flex now a matured and structural part of the market.
“This independent research confirms what we are seeing on the ground: flex is not an optional extra; it is a core part of how office buildings are positioned and operated,” he said. “Landlords and asset managers are recognising that occupiers want flexibility, operational simplicity and a high-quality experience, and flex delivers on all three.
“What is particularly striking is the shift from flex being a space-filling solution to a long-term occupier retention and asset enhancement strategy. In today’s market, if you’re not offering flexibility, you could be at a competitive disadvantage.”
Looking ahead, 36% of respondents cited economic uncertainty as the single biggest driver of flex growth over the next five years, pushing businesses further away from long-term lease commitments in favour of flexibility, reduced operational burden and easier access to amenities.
Orega also flagged that operational complexity in delivering flex workspaces remained significant, and remained a challenge for landlords and asset managers. Among the primary concerns are uncertainty in demand due to economic uncertainty (27%), perceived cost premiums versus traditional leases (27%) and operational complexity and the lack of in-house expertise to manage it (24%).
Among respondents, the preferred operational model was joint ventures or partnering on management agreements with specialist operators (39%); 33% prefer in-house operations and 23% support lease-based third-party arrangements.