A new study from flexible workspace specialist Workthere found that 79% of global flexible offices are profitable at an operating profit margin level.
According to Workthere’s Flexmark, a flexible office benchmark, there is a link between profitability and higher allocation of private spaces. The research surveyed operators from Belgium, France, Germany, Ireland, Spain, The Netherlands, Singapore, the U.K., the U.S. and Vietnam.
About 65% of revenue comes from private office rentals, compared to the 16% coming from coworking spaces. With this, only 12% of flexible offices with 80% or more of their space allocated to private offices were found to be unprofitable.
Workthere’s research also found that private office occupancy levels have been increasing year-on-year from 76% in 2018 to 81% in 2019.
“It appears that we are currently seeing an imbalance between profitability and allocation of space,” said Jessica Alderson, Global Research Analyst at Workthere. “With the corporate appetite for flexible space expected to increase further over the coming years as they recognize the benefits of greater collaboration and space efficiency, we expect some coworking areas within flexible offices to be converted into private offices to better match supply with demand and boost profitability.”