Office space demand could drop by upwards of 50% according to a new report from Instant Offices.
Companies have struggled with revenue over the past few months due to millions of workers working from home, and the benefits of remote and flexible working have shined through.
With a vacancy rate of 4.5% (equivalent to 57.6 million square feet), the amount of unused commercial offices would be nearly 50 times larger than London’s O2 Arena.
“COVID-19 has shown the world that we can cope with rapid changes to the way we all work, and as more businesses embrace flexibility, we’re going to see a permanent shift in the way an office can meet individual needs,” The Instant Group said.
Throughout the rest of the year and into 2021, Instant Offices believes that business leaders will have no choice but to embrace remote working. Prior to the pandemic, many companies were apprehensive to adopt these work arrangements, but have since discovered innumerable benefits to operating with a distributed workforce. Post-pandemic, The Instant Group’s CRE advisor Simon Johnson anticipates that remote working could be used for up to 50% of the UK’s workforce.
Although long-lease commercial property still makes up the majority of the UK’s market, demand for flexible office space is expected to rise as companies turn away from risky, long-term leases.