According to the latest report by JLL, Disruption or Distraction, the flexible office space sector in Europe has more than doubled since 2014, and could grow by up to 30% per year over the next five years. These forecasts - based on an analysis of 20 major European markets - also include Warsaw, which dominates the Polish flex market.
According to the report, the volume of flex space in the 20 largest flexible office markets grew by 30% in 2017 – equivalent to around one million sq m. Furthermore, over seven million sq m could be added to Europe's flex market by 2023.
The rise of flex space is resulting in one of the biggest shifts across the real estate industry that we have ever seen. The consumerisation of real estate, which we’ve already witnessed in hospitality and retail, is reshaping business models and investment strategies alike. Our research shows how different markets and different companies are moving at varying speeds, and as the dramatic growth showing no signs of slowing, companies, investors and developers must keep on top of the evolution to understand what this means for their specific business ambitions, comments Dan Brown, Head of Flex Space, EMEA, JLL.
Experts from JLL estimate that in recent years the flex market in Poland has grown by approx. 30-40% per year, and over the last year it has grown by 100%. Companies offering flexible office space already have more than 220,000 sq m in stock. 75% of this space is located in Warsaw.
Our data confirms that in Warsaw alone, by the end of Q3, operators of flexible office space had leased 91,000 sq m, illustrating that this sector is becoming an increasingly important source of demand for offices. Furthermore, with the development of start-ups, small and medium-sized businesses and the creative industry as well as more frequently - large corporations - the flex market has great potential to grow even more. This future growth potential is especially evident when you take into account the new investment entering the market, from companies such as Regus, Spaces, WeWork, Business Link and CitySpace. Our data shows that flexible spaces will comprise one in every four square meters of office space leased this year in the centre of Warsaw”, comments Mateusz Polkowski, Head of Research and Consulting, JLL Poland.
The four main operators already account for 57% of all flexible office space available in Poland. So what is the key ingredient in the success of the flex office concepts?
Flexible office spaces perfectly respond to the changing needs of employees and the evolution, or even the revolution, of our working styles. Today, we increasingly seek creative spaces that are available by the hour, encourage co-operation and are a natural source of new business relationships and daily inspiration. These expectations are met by a wide range of flexible offices, which apart from conference rooms, assigned desks and virtual offices also take into account access to a range of events organized by the local community, - explains Anna Młyniec, Head of Office Agency and Tenant Representation, JLL Poland.
This sector consists of serviced, co-working and hybrid office spaces.
The 20 largest European markets: in Amsterdam, Barcelona, Berlin, Brussels, Budapest, Dublin, Düsseldorf, Frankfurt, Hamburg, Lisbon, London, Madrid, Milan, Munich, Oslo, Paris, Prague, Rome, Stockholm and Warsaw.