‘The office is a foreign country, they do things differently there…’
Taking a favourite old quote and turning it into something new seems appropriate when talking about the future of the workplace.
The workplace itself is a new and changing place. Technology lessens the separation between work and home, and the office is no longer nine to five or a place with desks and a photocopier. As technology improves, so the need for presenteeism lessens. As working hours change, so the need for desks in fixed offices lessens.
Focusing on customer needs
Over the past few years the focus has shifted from demands of landlords to demands of customers. Traditional property companies and lease structures find themselves challenged by businesses that may not want what they are providing. The fleet-of-foot nature of the flexible space sector gives the ability not just to respond to emerging trends, but to develop and guide those trends. The rise of co-working and the focus on nurturing small businesses from startup through growth is not just a good thing to do, it makes economic and business sense.
As a not-for-profit trade association representing the needs of operators, suppliers and customers of managed and serviced workspace, and with more than 1,200 member locations across the UK, at the BCA we know diversification and adaptation are key to the success of the sector.
Our research has shown the sector contributes £2.5 billion a year to UK plc with an overall contribution of just under £8 billion to GDP. All this is based on a business model which makes it very easy for customers to grow in the same space and to exit without any financial penalties – and, by doing so, tends to mean they stay.
A great deal of focus is on the success of Tech City. By the time government recognised it, Tech City was already well established with flexible operators. New and growing companies had already created their desired community, and more traditional landlords were only starting to look at how to get in on the act.
The success of the serviced office and flexible space industry is far from just a London story. Across the regions, rates and occupancy continues to increase with different regions displaying their respective strengths. Light industrial continues to be a strong driver of occupancy rates in the North East, Yorkshire and Humber, and Scotland with serviced offices dominating in East England.
Disruption and change
Our research also shows more and more operators entering the market, along with more and more property companies letting space to flexible operators in grade-A buildings. Customers in flexible space trade and socialise with each other, businesses grow faster when they collaborate and workplaces themselves become a core part of that dynamic, fuelling the economic engine.
Underpinning this is high-speed broadband as the workplace only works when the technology allows it to. Government at all levels needs to recognise this because, when you get better broadband in Bulgaria than in London, Manchester or Birmingham, there is a problem. Without the right connectivity, the future of the workplace is uncertain.
We are living in an era of change and the flexible space sector is leading in creating that change. Disruption has the potential to be the new best friend of the office market. Be proactive, embrace new technologies and business models which can add value to existing propositions.