Post-COVID: the flexible office opportunity for landlords
In the wake of the pandemic, the commercial real estate market will start to accelerate toward greater flexibility. To meet this quickly growing demand, landlords will need to adapt their marketing and delivery systems.
Amidst a forced global experiment in remote working, large employers are beginning to think long and hard about the corporate workplace of the future. Overnight, conventional workplace strategy has been upended, as most companies have abruptly transitioned from 100% WHQ (work at HQ) to 95%+ WFH (work from home).
In considering the practicalities of workplace re-entry and a return to some new normal post-COVID, there are many questions and few clear answers. Will employees simply return to the office? Will existing office designs feel appropriate and safe in a time of social distancing? What if newly liberated employees choose to stay at home?
Facing so much uncertainty, corporate managers are retreating from long-term commitments and thinking more about how they can build flexibility and resiliency into the “new normal” of their operations, especially the workplace.
Going forward, companies are preparing for a distributed workplace giving employees and teams the permission and the tools to modulate between home, flexible office and HQ.
What makes flexible offices suddenly so desirable? Consider the new reality in a post-COVID world:
- Economic uncertainty will linger.
- Many employees will have proven, for themselves and their managers, that remote work actually works, at least some of the time.
- Some employees may simply be unable to leave their homes for 8 to 10 hours a day if schools and daycares remain physically closed.
- Resuming long commutes and public transportation will be unpleasant for most and threatening for some.
- Dense and open-office layouts will create anxiety.
- Corporate real estate leaders will be tasked with rationalizing their portfolios, to search for cost savings, and to instill a new level of resiliency in anticipation of future disruptions.
That’s where the growing inventory of flexible offices comes into play. These spaces offer an alternative that may allow workgroups to be productive and collaborate, while still staying close to home.
Landlords, whose principal offering has been long-term leases of raw, unfinished space, might appear to be cut out of this scenario. However, many landlords have been taking steps toward entering the flexible office economy. Now’s their time to make the leap.
In order to meet the flexible-office demand, landlords will need to overcome several challenges:
First, how do they reach the customers who are actively looking for flexible office space? Traditionally, landlords have been hidden in plain sight. Even basic information about their property locations, availability and pricing is often out of reach, tightly managed by commercial brokers who control the flow of information to prospective clients. Until now this has been an acceptable arrangement, especially when the endpoint is a multi-million-dollar, 10-year lease for the building owner, and a large commission for the broker. But historically, the brokerage community has turned its back on smaller and shorter-term customer requirements. Whether a single office by the month for a remote exec or a 10-20 person team space for several years – these deals have simply not offered enough juice for the squeeze.
Second, landlords will have to cater to the unique expectations of flexible-office customers, perhaps best summarized by Lisa Picard of EQ Office as “the three Fs”:
- Fast – Flexible-office customers are accustomed to touring today and moving in tomorrow. Is your leasing process geared for this tempo? Do you have a standard smart contract to eliminate legal delay? Is your space ready to occupy?
- Fun – The coworking revolution of the past decade has opened companies’ eyes to the importance of providing a workplace that helps attract and retain great employees. For landlords this means thinking deeply about the overall experience of your building, from entry to amenity spaces to the design and fit-out of each customer’s suite.
- Flexible – The economic upheaval of the current pandemic is only the latest of a chain of historic events that have taught SMBs and large enterprises alike that long-term real estate commitments are risky. Multiple surveys of enterprise occupiers predict that 20+% of the corporate workplace footprint will shift to flexible offices over the next 5 to 10 years.
LiquidSpace was built from the ground up to power the flexible office economy and help landlords make any space a flexible office.
- Attract – Reach customers directly with omnichannel distribution. Promote your space to thousands of active prospects in the LiquidSpace marketplace. And activate your property websites with LiquidSpace widgets, which transform your static website into a direct-to-consumer ecommerce experience, where prospects can discover, tour and book with a click.
- Convert – Execute deals faster with a simple end-to-end digital leasing workflow. Eliminate legal cost and customer frustration with DASH™, a proven, at-scale smart contract for flexible office.
- Fit-out – Enhance the marketability of your pre-built and spec-suite inventory with altSpace, our turnkey design, and fit-out service. Delight prospective tenants with a full turnkey experience that eliminates upfront capex and dramatically shortens time to market.
Are you a building landlord who is curious to learn how to shift your space to flexible? Click here to get started.