Dr. Gleb Tsipursky – The Office Whisperer
Nirit Cohen – WorkFutures
Angela Howard – Culture Expert
Drew Jones – Design & Innovation
Jonathan Price – CRE & Flex Expert
Once considered an alternative workspace model, flex is now firmly embedded in the commercial real estate mainstream. What began as a post-dotcom experiment has grown into a resilient, investor-grade asset class, driven by strong occupier demand, institutional investment, and operational maturity.
According to Spaces to Places new UK Flex Office report, London office occupancy remains strong at 93%, proving demand for well-run workspaces is resilient. The city remains the epicentre of flex growth in the U.K., with occupiers increasingly seeking turnkey, hybrid-ready spaces over traditional long leases.
Key Market Indicators
- Managed office supply has surged +895% since 2019, largely fuelled by hybrid work adoption and the need for fast, cost-effective occupancy
- 41% of new operator deals now use management agreements, up from just 9% pre-COVID
- Typical London deal sizes are 2,000 to 4,000 sq ft, with pricing between £150 and £240 per sq ft
- Market consolidation is underway, with expectations that the U.K. will stabilise around 10 to 15 scalable providers with proven, investor-ready models
Institutional Investment and the Rise of the Brandlord
Major landlords including Landsec (via MYO), British Land (with Storey), and CEG (Let Ready) are launching their own branded offerings, moving beyond passive leasing to become active operators. These “Brandlords” aim to capture more value through greater control, improved customer experience, and stronger income performance.
This also reflects the rise of operational real estate models, where revenue generation is tied to service delivery rather than just fixed rents. Landlords are increasingly embracing management agreements and profit-share models that align incentives with operators and support long-term flexibility.
Changing Occupier Expectations
Hybrid working patterns, capex avoidance, and speed-to-market have become baseline requirements for many businesses. These factors are reshaping demand and pushing more occupiers toward managed, ready-to-use space.
In Central London, 78% of 2024 enquiries under 5,000 sq ft were for fitted or managed solutions. Managed space is now the default for smaller occupiers and project-based teams, replacing what was once a niche alternative.
Diversification of Models and Operators
The flex sector is no longer defined by one model. It now includes:
- High-end, hospitality-led providers with premium services and design
- Value-driven operators focused on simplicity, affordability, and scale
- Specialist providers such as Mission Kitchen (culinary space), Until (wellness), Techspace (technology), and Impact Hub (social enterprises)
This diversity reflects the flex sector’s ability to meet a wide range of business needs while expanding beyond traditional office definitions into light industrial and retail-adjacent formats.
A New Valuation Framework
Valuation methodologies are evolving to match the sector’s operational nature. Discounted cash flow (DCF) models and EBITDA-based valuations are replacing outdated capitalised rent approaches. This shows an understanding of flex as a recurring revenue, service-led business — more akin to hotels than traditional offices.
The Outlook: Flex as the New Standard
What was once considered a disruptor is now embedded in the real estate mainstream. The growth of managed solutions, adoption of hybrid lease structures, and landlord-led brand creation signal that flex is here to stay.
Flexible offices now serve a dual function:
- For occupiers, they offer adaptable, service-rich environments tailored to modern work patterns
- For landlords, they provide a responsive, higher-yielding income model that outperforms traditional leasing in both velocity and value
