Over the past five years, flexible office space has gone from strength to strength in the UK. Undoubtedly, the impact it has made in the commercial sector doesn’t seem to be falling any time soon. In fact, over the last 12 months, London City has seen a year-on-year growth of flexible office space of more than 12% and London’s West End has risen 22%.
In the UK we have certainly witnessed a prominent shift in people’s thinking towards flexible office space. In recent years we’ve seen a large increase in the number of office providers and in the type of space on offer in order to meet increasing demand.
SMEs have become more attuned to searching for and finding space, shopping around across a number of office providers, often using brokers to bridge the gap. Brokers are experts in their field assisting companies through the whole process, often not only finding the right spaces but negotiating and getting the best deal too.
The growth in this sector demonstrates there is a demand for flexible office space across London and the UK. It is now clear that larger organisations are also starting to consider flexible office space as a viable working option, moving away from conventional, leased office space.
We are also finding that, as the current market sees a high influx of new providers, there is an expanded portfolio of new buildings to meet the demand for more space, and prices have had to become more competitive.
On the whole, London remains the hotspot where growth has been the strongest. Beyond London, prices have remained relatively unchanged, although there has been some growth in city hubs such as Leeds, Bristol, Manchester, Birmingham and Newcastle.
We are also starting to see contract lengths increasing, as businesses are often keen to either lock in a rental cost or establish an agreed increase year-on-year for periods of two or three years. This is unusual for this sector but demonstrates the commitment from both parties to align and forge strong long-term working relationships.