Major flexible operators are looking to push forward with expansion plans in order to take advantage of potential upcoming opportunities for the industry.
For example, IWG recently took up 30,000 square feet in Hong Kong, while Serendipity Labs and Industrious are looking to expand as well.
Ben Munn, managing director at flexible space of JLL, said that operators who were in a strong financial position prior to the pandemic are able to take two paths in expanding: acquiring business from struggling competitors or taking over space from other operators.
“In some cases, the previous operator has exited their lease, or in others collapsed the special purpose entity holding the lease, leaving the landlord with no recourse,” said Munn. “Or it may simply be that an operator presented unfavourable terms to the landlord for renegotiation and the landlord is taking the opportunity to restructure the workspace proposition in the building.”
The ongoing pandemic is putting pressure on tenants, but makes it difficult to indicate what their property needs are. Munn added this puts flexible office companies in a good position as they offer flexible leases, lower costs and allow organizations to scale up or down as needed.