- Top takeaways from MatchOffice’s 2018 flexible workspace survey in continental Europe
- The report finds a rising trend for occupancy levels of 90% or above, although growth has slowed slightly compared to last year
- Germany and Sweden are leading the field, although all markets are feeling the effects of increased competition
Earlier this month Copenhagen-based serviced office broker, MatchOffice, released its fourth annual survey covering flexible workspace performance across 8 countries in continental Europe.
The report found a rising trend for occupancy levels of 90% or above. However, overall occupancy growth has slowed slightly compared to last year, which may be indicative of rising competition and new centres opening. This is having a knock-on effect on pricing as the majority of European operators are maintaining the same prices as last year in order to stay competitive.
Top Takeaways – Europe
- Belgium: Over 30% of the workspaces are almost fully occupied – representing a 7.5% increase compared to 2016 – and over one-third have the same occupancy as last year. Only 8.7% of respondents in Belgium predict fewer clients in 6 months’ time.
- Denmark: There has been an increase in centres reporting occupancy of 90% and above, but those with less than 60% occupancy has doubled. This is likely down to a surge in competition and new workspaces opening in key markets like Aarhus and Copenhagen. According to MatchOffice, demand in Denmark is “buoyant” and this has allowed providers to increase prices without losing clients.
- France: A quarter of all workspaces that participated in the MatchOffice survey are almost fully occupied and close to half report occupancy higher than 80%. However, over 20% of providers have negative occupancy expectations over the coming year, which may be linked to 25% of providers increasing their rental rates.
- Germany: MatchOffice claims that the German market is the industry leader in continental Europe, and based on performance, it’s not surprising. Almost half of workspaces are over 90% occupied, which is above average compared to the rest of Europe, and the two lower occupancy bands have also diminished slightly. Looking ahead, nearly 30% of providers in Germany expect even better results in terms of both occupancy and profitability forecasts, with more than 70% of respondents holding an optimistic view.
- Italy: The market is picking up in Italy – that’s MatchOffice’s conclusion based on improvement in the two highest occupancy bands, with a simultaneous decline in offices less than 69% occupied. Interestingly there is a 24% rise in shorter contracts, possibly reflecting local demand for greater workplace flexibility.
- The Netherlands: There is a distinct upsurge in the popularity of flexible workspaces in this market as more than half of workspaces reported an increase in clients compared to last year, combined with a twofold decrease in those with lower occupancy.
- Spain: The number of workplaces with more than 90% occupancy has increased by 12%, and MatchOffice reports a growing tendency for providers to have higher year-on-year occupancy, especially in big cities like Barcelona and Madrid. There are no negative sentiments this year, whereas the number of providers who believe the Spanish industry has very bright prospects has doubled.
- Sweden: In Sweden, the biggest growth is in the 80-89% occupancy band, while there are threefold fewer offices with the lowest occupancy rates. Furthermore, over 40% of Swedish operators believe they will have more clients over the coming year.
According to the report, 70% of the respondents have an optimistic outlook for the industry, which MatchOffice CEO Jakob Dalhoff says is indicative of a “healthy and thriving” flexible workspace market in Europe.
“Furthermore, it has a good growth potential as many providers are expanding their business to new cities and countries,” he added. “In 2018, we acknowledge that the industry has fulfilled providers’ aspirations for growth, and, like in previous years, has shown its great potential. We can confidently say: the best is yet to come.”
Martin Roerholt, Global Relationship Manager at MatchOffice, noted that increased competition is being felt across all parts of Europe, which is forcing operators to differentiate and improve the quality of their buildings. “It’s more important than ever that the providers find their strategy and position in the market. They do need to identify how to differentiate themselves – otherwise, you will be outperformed much faster than just a few years ago,” he said.