According to new data from Workthere, the flexible office brokerage of Savills, New York City and San Francisco are the priciest flexible office markets in the world.
The main reason? Occupiers want the highest quality office space, and real estate costs in these cities are not for the faint of heart.
In New York, a private office desk costs an average of $961 a month and $950 per month in San Francisco.
Three European cities were placed in the top ten, including London in sixth with $803 per desk a month, followed by Berlin at $800 a desk per month.
“The flexible market is now dominated by high quality spaces because occupiers are focused on cultivating an updated office strategy around a space employees want to be in, and in an environment that enhances their desired culture,” said Griffin Foley, Northeast Lead, Workthere Americas at Savills. “Similar to the Manhattan office market as a whole, there has been an undeniable flight to quality which has resulted in a shrunken set of options to choose from and ultimately higher asking rents.”
In addition to the desire for high quality workspaces, the overall popularity of hybrid work models has increased the demand for flexible offices. In fact, demand may soon surpass supply according to Charlie Morris, practice leader of flexible office solutions at Avison Young.
Morris suggests that owners will need to “evolve their own asset management strategies” by either offering their own flexible product, or partnering with a flexible office operator in order to keep up with demand.