A new report from The Instant Group has found that demand for flexible office space is growing as companies prepare to bring workers back into the office.
The analysis found that demand for flex offices grew by 21% during the second half of 2020, but transactions decreased by 29% due to purchases involving mainly smaller buildings with less desks.
Secondary cities such as Austin and Denver saw the strongest demand for flex space mostly due to lower costs of living and a higher quality of life than larger cities offer.
“We call them lifestyle cities,” said Joe Brady, CEO of the Americas for The Instant Group. “You have quality of life. If you’re commuting, you’re doing so by car or scooter or bike. The weather’s fantastic, the tax environment … is massively welcoming, and so you can actually achieve what we’ve always talked about. This notion of a work-life balance.”
On the other hand, demand for flex space in New York City fell in 2020, while surrounding areas like Westchester, New York and Connecticut saw a spike. This was likely due to more people migrating to suburban areas for more affordable living arrangements and people wanting to work closer to their homes.
“What you had were folks that were wanting to work near home and having that alternative,” Brady said. “We see that as a reaction. What we’re going to all have to do is track to see if a five-day-a-week workweek will actually return. Our position is that it probably … could be two-and-a-half, three days a week in the office.”