Market Trends of United Kingdom Flexible Office Space Industry
Demand for Larger Spaces driving the market
An industry group says that the number of flexible office spaces in the UK will almost double between 2019 and 2023, reaching 167 million square feet by 2023. Flexible office space, also called coworking space or shared office space, is a type of commercial office space that people, small and medium-sized businesses, and other professionals can rent for short periods of time. Flexible offices are different from traditional offices because they offer fully furnished and serviced office space without long-term rent commitments.
As the market is returning post-COVID-19 and it is becoming more apparent that 2023 is the year to embrace flex space, With serviced offices filling up and tenants opting out of long-term lease options, they're beginning to return to the city by seeing the benefit of being housed in a flex space.
Increase in demand for flexible office space in London
London is one of the prominent markets for office space that is expanding the quickest in the globe, owing to the booming start-up and IT sectors there, rising demand for office leases, and the emergence of flexible office spaces. The increase in small and medium-sized businesses is a trend observed across all major cities in the United Kingdom, while new working practices are neither location- nor sector-specific. These trends have fueled the flexible office market in London. The rise in the number of startups in the region is also expected to boost the market's growth.
In 2023, the London office market seems to be driven by a number of important factors.Because of these forces of change, trends like record completions, shorter lease terms, steady growth in the flexible workspace market, and an oversupply of prime office space caused by a persistent flight to quality will get stronger.
The most recent studies done in 2022 show that the number of people looking for flexible office space in London is once again going up. As more and more businesses require employees to come back to the office in some capacity, it seems as if flexible ways of working facilitate both in-person and remote scheduling. This growing demand for flexible offices is leading to a reduction in available supply as well as higher costs for these types of spaces. For example, the cost to rent a permanent desk in a flexible workspace increased by 3.4% quarter over quarter in 2022, reaching GBP 690 per month.
