To make this new shift, employers must take into account the change in their employees' needs and expectations since remote work has numerous advantages that employees are not ready to give up on, like working more flexibly or not having to commute, therefore saving time, money and energy. To meet their employees' new expectations, many organizations are turning to flexible workplace solutions, reconsidering their space needs and redesigning workspace productivity.
A new survey from Yardi Kube takes a deeper look into why coworking spaces are becoming so popular and how occupiers are adapting to flexible work arrangements. The survey asked 1,118 soon-to-be office tenants these simple questions:
- Are you currently using flexible workspace solutions as part of your office portfolio?
- What are the top three reasons why you are choosing a flexible workspace?
- Considering office space requirements, how is your use of office space likely to change?
- Do you or your company plan on making office attendance mandatory in 2022?
- Do you intend to use coworking spaces in the near future?
- 1 in 3 respondents are considering flex office options in the future
- Cost savings, flexibility to increase or decrease the office footprint as needed and short-term lease availability are the main reasons for leasing flexible workspaces
- 47 % of respondents are embracing hybrid work
Most occupiers are coworking fans
According to the study, less than 2% of the office supply were coworking spaces. Nowadays, many businesses incline to coworking solutions due to their employees' post-pandemic requirements. Because remote and hybrid work has become an attractive workstyle, they're less likely to accept an exclusive return to the office. Occupiers are aware of this, so it's obvious why 39% of respondents to the survey stated that they either have a coworking subscription or are currently looking into one.
Flexible work arrangements are an upgrade of the office as we know it, coming as a solution not just for employees' new expectations but also for the demands of occupiers. It meets the need for more efficient space management, flexibility and cost savings.
Greatest coworking benefits: Cost savings and flexibility
The main reason occupiers opt for flexible workspace is that it results in cost savings, or at least this is what 24% of the respondents have stated. In addition, 17% of them think a flexible office footprint is a top priority, coming right after cost reduction. The third priority is short-term lease availability, as 10% of respondents said this is why they were interested in coworking properties.
The study's results confirm what previous CBRE surveys have found. They show an increasing interest in flex offices, fostered by the rise of hybrid work and the demand for flexible office footprint. Brian Sutherland, vice president of sales at Yardi, stated in a GWA webinar that coworking is the ideal solution for those looking for turnkey offices while demanding flexibility. In his opinion, "Coworking provides the best of both worlds".
Other factors also catalyze the popularity of coworking. For example, 8% of respondents said the ability to facilitate a hybrid work model matters. Also, 7% choose coworking because of the access to high-potential employees since the location stops impeding recruiting (7%).
Offices are here to stay
In 2020, many employees had to leave their offices and work from home, making most workplaces useless. This led people to think that space requirements would decrease over time, which is different from what the actual reality shows us. Returning to the office and hybrid work brought offices back to the table. Consequently, more than half of the respondents (56%) stated that their needs for office footprint would stay the same. At the same time, 35% are considering upsizing their footprint, while only 9% plan to rent smaller spaces.
Most respondents (91%) predicted an increase or no change in their office footprint, which makes the office a thing of the future. However, its role will most likely evolve because of the rise of hybrid work.
66% are into hybrid work
Increasingly, employers agree that giving employees more autonomy over work outside the office makes them value their time in the office more. That's why companies are trying to offer their employees opportunities for flexible work. For example, 47% of respondents in the Yardi Kube study indicated they would require their teams to work fully remote or no more than two days a week in the office.
Companies' return plans differ, so the ideal office solution should be tailored to their individual needs. These differences are obvious when looking at the number of companies planning to return to the office full-time vs. those planning to work remotely. The percentages are almost the same: 34% and 35%, respectively. Some companies would like to integrate both alternatives. About 12% of companies would want their employees to spend some time at the office (1 to 2 days), while 19% would opt for 3 to 4 days at the office.
When asked if they intend to use flexible working spaces, less than half of respondents (39%) had a positive answer, which shows their preference for traditional office spaces. However, this doesn't mean they don't see coworking as a viable solution, but only that it doesn't fit their business model at the moment.
In a world where hybrid work plays a crucial role, business leaders must reinvent their office solutions and create clear policies regarding their employees' presence at the office. At the same time, they must keep in mind that each company has individual traits that should be considered when making any workspace decision.
Check out Yardi Kube's original study for more details and the methodology.