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Savills reports serviced, flexible workspace is increasingly popular

Savills reports serviced, flexible workspace is increasingly popular
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Savills reports serviced, flexible workspace is increasingly popular
Siobhan Stirling - Sharp Minds Communications for Capital Space by Siobhan Stirling - Sharp Minds Communications for Capital Space
Owner/Director - Sharp Minds Communications Ltd

To be a successful business, you need to be aware of trends happening in your sector, including drivers such as changing customer wants and expectations, technological developments and macro-economic trends. The serviced office sector is no different, so at Capital Space we keenly devour industry reports to ensure we continue to meet the evolving property needs of small and medium-sized businesses. A significant sector report is the Savill’s Flex Report , which shows lots of reasons for optimism for 2024 and beyond.

Serviced office sector overview: increasing demand

There is good news for the serviced office sector: demand is increasing for flexible office space, with average desk prices rising as a result and occupancy rates at 88% in London and 86% in the rest of the UK. Demand has risen by a staggering 173% since pre-Covid levels and enquiries are up 12%, year on year, leading to increased optimism from landlords regarding the long-term future of the serviced office sector, which in turn provides reassurance for their customers about the security of their workspace.

Business accommodation that offers flexibility in highest demand

Savills’ findings show that, increasingly, corporate businesses are only willing to consider buildings which offer flexible, serviced space as they look to relocate. This growing demand for flexibility has resulted in increasing size requirements from customers as the typical footprint in demand was 2,500 sq. ft+ in 2023, up from  500-2500 sq. ft in 2022. Significantly, there is increasing desire from larger tenants to transition to flexible spaces as 13% of spaces are reportedly over 5,000 sq. ft. This suggests that flexible space is not just for SMEs anymore but is also attracting larger organisations looking to operate in serviced space.

As a result, serviced offices may see greater diversity among their customers, with flexible space now appealing to more sectors as they begin to see its value, leading to a richer, more varied working environment.

The importance of amenities in flexible workspaces

Alongside the growing demand for flexible space, the serviced office sector is attracting more customers due to the amenities they can offer. According to the report, there’s a higher demand for “readily available space for amenity rich buildings”. Amenities add to convenience, but they are also sought after for two other reasons.

Firstly, as the labour market has become a “war for talent ”, employers are focusing more on what amenities they can offer their staff when they come into the office as a way of making their work environment more attractive.

Flexible offices are also a useful way to promote collaboration especially when communal spaces, restaurants and cafes enable networking between the different companies in a business centre. Spaces which encourage this are seen as more valuable as they can open up new opportunities for customers.

Meeting the needs of today’s SMEs and entrepreneurs with flexible business accommodation

With inflation pushing up the costs of fitting out and financing an office building, the serviced office sector is becoming increasingly attractive as it puts the onus for maintaining the space on the provider. Add to this the quicker move in time and the flexibility to adapt your space and location according to your business’s needs, and it’s easy to see why the Savills Flex Report shows that things are looking positive for the serviced workspace sector.

Having built our Capital Space business centres around a key philosophy of offering SMEs and entrepreneurs the flexibility and facilities they need to adapt to changing opportunities and support their growing businesses, we’re not surprised that flexibility and amenities are the key things that businesses are looking for in 2024.

As flexible, serviced workspaces become increasingly in demand, their benefits are really shining through as the amenities, collaboration opportunities and convenience for business owners and their staff become ever more valuable.

If you’re searching for a flexible, serviced workspace for your business, get in touch