Dr. Gleb Tsipursky – The Office Whisperer
Nirit Cohen – WorkFutures
Angela Howard – Culture Expert
Drew Jones – Design & Innovation
Jonathan Price – CRE & Flex Expert
For decades, the commercial real estate industry equated “long-term lease” with “predictable revenue.” A 10-year or 15-year lease was the covenant of stability. Yet today the data underscore a far different truth: traditional leases no longer guarantee predictability.
With sublease inventory swelling, shrinking footprints, and rising defaults, what looked like stability has morphed into uncertainty. Office vacancy reached 19.8% in 2024 — the highest on record for many U.S. markets.
In contrast, the flexible workspace sector offers a radically different value proposition: predictable revenue, not through duration, but through measurement.
When asset owners and flexible workspace operators understand the six core drivers of predictable revenue, flex space is not really a gamble, it becomes a quantifiable growth vehicle.
Why Predictability Matters — And Why Traditional Leases Are Failing to Deliver
The assumption that long-term leases deliver predictable cash flows is under threat. U.S. office vacancy approached nearly 19.4% in Q1 2024, according to Yardi Matrix. Another study by CBRE shows sublease availability has nearly doubled since the pandemic — a sign that tenants are exiting or downsizing even within lease terms.
Legacy leases were built for a world of certainty that no longer exists. The capital markets, however, still cling to the idea that duration equals stability. The irony is that predictability no longer comes from a 10-year commitment but from measurable, repeatable metrics.
In this new cycle, data beats duration.
The Six Drivers of Revenue Predictability
These six metrics convert flexibility into forecastable returns. They form the operating playbook for asset owners and flexible workspace occupiers alike.
1. Predictable Lead Flow
Flexible workspace generates steady lead flow through digital marketing channels — SEO, paid campaigns, marketplaces, and broker partnerships — all measurable and repeatable.
2. Predictable Conversion Rates
When tracked effectively, conversion rates from inquiry to sale across products such as workstations, meeting rooms, and virtual offices follow consistent patterns.
3. Predictable Time to Close
The sales cycle from inquiry to deal is measured in weeks, not years — a fundamental and easily monitored metric.
4. Predictable Deal Values
Average deal values by product type are readily trackable, allowing clear revenue forecasting.
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5. Predictable Agreement Terms
Contract length, whether months for offices or hourly rates for meeting rooms, can be systematically captured and analyzed.
6. Predictable Churn
Renewals, upgrades, and retention are controllable and measurable — the opposite of the silent risk embedded in subleased portfolios.
Together, these six factors create the foundation for measurable and predictable performance. Layer in cost per acquisition, and the model becomes a transparent, trackable formula for growth.
Each of these metrics mirrors the frameworks long used in hotels, gyms, and other operating asset classes that track daily performance — occupancy, churn, and average revenue per member. Traditional office assets were never built to measure this way. Flexible workspace operators are.
The challenge is that the industry remains fragmented, with only one publicly traded operator providing consistent reporting. Until metrics like these are standardized across the category, the capital markets will continue to underestimate the predictability of flex space.
Lessons from Other Asset Classes
Hotels and gyms aren’t financed on 10-year contracts with a single tenant. They’re financed on performance data. Occupancy, RevPAR, member retention — those numbers prove predictability to lenders.
Flexible workspace runs on the same logic. The global flexible office market is forecast to grow from $39.6 billion in 2024 to $136 billion by 2032, a 17% annual growth rate. Growth this steady attracts capital when it’s underpinned by standardized metrics.
By contrast, legacy portfolios remain locked in the illusion of security. Sublease availability has surged. Vacancy is at multi-decade highs. And defaults — once rare — have entered the headlines. The “predictable” lease is the real risk asset.
The Opportunity for Asset Owners and Flex Operators
For asset owners, dedicating part of the portfolio to flexible workspace creates a new source of measurable, predictable income — one that strengthens NOI and reduces dependence on long-term leases.
But predictability doesn’t happen on its own. It comes from partnering with an operator who runs a data-driven model — one that tracks lead flow, conversion rates, deal values, and churn with the same rigor as any operating business.
When owners and operators align around data, they transform flexible space from a leasing experiment into a financeable revenue stream. The more visibility an owner has into those metrics, the easier it becomes to model income, forecast renewal rates, and demonstrate performance to lenders and investors.
This is how flexibility becomes predictable — and how predictable revenue becomes bankable.
The Single Biggest Barrier: Fragmentation
The model works — right now the industry’s structure doesn’t. The flexible workspace category remains fragmented, with multiple operators, inconsistent reporting, and no shared data language. Until that changes, the risk is that capital markets will hesitate to underwrite flex space as a standardized asset class.
Standardization is the next revolution. Just as hotels converged around ADR and RevPAR, and gyms around churn and retention, flex needs its own shared vocabulary. The six drivers above form that foundation — the framework for underwriting the modern office.
Call to Action
Asset owners: Start by assessing your portfolio. Look at the demand patterns, lease terms, space sizes, and occupier needs within each asset. Then, consider how to evolve the product mix — combining traditional office space, flexible workspace, meeting rooms, and spec suites — to align with today’s market.
When you do introduce flexible workspace, whether managed internally or through an operating partner, apply the same discipline used in other operating asset classes. Measure what matters: lead flow, conversion, time to close, deal value, and churn.
Those metrics are what transform flexibility from a concept into a proven, bankable revenue stream.
Flexible workspace operators: This is a call to action focus on data — that’s where the advantage lies. The more transparent and consistent your metrics, the faster the capital markets will recognize the stability of this model.
As real estate redefines its logic, it can take cues from categories that already mastered short-term stability. Hotels and gyms operate on flexible terms but deliver predictable returns because their performance is measured, standardized, and transparent. The same principles apply to flexible workspace.
When metrics are clear and consistent, flexibility is no longer volatility — it’s a proven operating model.
