General, Offices, Property Industry News

Landlords, pay attention to the growing demand for flexible & serviced office spaces.

With some of the biggest names in the professional services sector, from top law firms to major international banks, moving out of expansive, legacy offices into serviced office space, we asked our Head of Agency, Thomas Szymkiw what owners of the more traditional office accommodation should be doing to capitalise on this emerging trend.

At NG we’ve seen first-hand how tough economic headwinds and post-pandemic working habits have prompted many organisations to downsize their physical footprint, often to the advantage of the serviced office sector, a sector entering a period of substantial growth. 

Despite the ongoing economic challenges and a continued rise in the hybrid working model, professional services companies remain overwhelmingly concerned with prestigious locations and proximity to their client base, presenting a wealth of opportunities for commercial property owners.

So, what can landlords do to attract professional services firms wanting to make a bold statement about their market status whilst establishing a longer-term presence and future-proofing their business?

Mirror serviced office providers.
In recent years, the perception of what constitutes a serviced office has changed dramatically largely due to the attention to detail by their owners. Today, they are widely regarded as some of the highest-quality office spaces available. Having a landlord manage your utilities, handle carpet cleaning and take care of the security is most certainly beneficial for companies on a tight budget. 

It’s important to note that many serviced office developments are often in prime city centre locations, providing easy accessibility to clients and aligning with the growing emphasis on flexible working, a primary concern for many businesses in the post-Covid era.

Refurbish and invest in existing assets.
While we acknowledge the serviced office model might not suit every landlord, another viable option would be to refurb and renovate existing assets. Consider high-tech, ergonomic spaces that prioritise staff and client well-being front and centre. Upgrading your assets to Grade A specification and enhancing eco-credentials, will undoubtedly resonate with the desire for prestige shared by accountants, investment managers and legal eagles.

Thomas Szymkiw, head of agency at NG Chartered Surveyors, commented: “In Nottingham and across the expanse of Midlands we have seen many of the larger, notable organisations choosing to downsize and transition into serviced office spaces. Whilst cost reduction is often the primary motivation, this trend should also be recognised as a reflection of a much-changed working environment where employees value greater flexibility.

“Serviced office providers are emerging as the primary beneficiaries of this shift, but there are ample opportunities for others. Landlords sitting on vacant office space should explore specific refurbishments to attract and appeal to a different audience.

Professional services firms are known for the emphasis they place on more high-spec office accommodation, the physical presence and creating the ‘wow factor’ acts as a marker of status. In many cases, it’s the multi-million-pound organisations where poorly equipped, inflexible and unwelcoming office spaces just don’t cut it! Every detail should be high-end, slick and ultimately professional.

This is where serviced office providers are taking the lead, which explains why numerous top companies are opting for the serviced route.

In the current climate, commercial landlords wanting to maximise their return on unprofitable investments would do well to consider high-quality refurbishments and offering flexibility to potential tenants. There’s a lot of money flowing into the sector right now, including here in the East Midlands and looking at the longer term view, it’s clear demand for flexible office accommodation is here to stay and the serviced sector will likely remain a lucrative one.”

Thomas believes that the days of professional services firms taking large, statement and often ego-driven offices are well and truly over.

He added: “It’s important to note how much office space professional services firms occupy nationwide. Landlords should recognise that we are now entering a time where pragmatism rules and repurposing of offices is both inevitable and welcome. City centres are evolving rapidly, and there’ll be no rewards for those who lag with their property portfolios.

“At NG we have a wealth of experience working with professional services companies. I would invite any landlord with an eye on the sector to contact us today to explore potential ways forward together.”

For a conversation on progressing your property portfolio to maximise investment, call Thomas on 07564 580 300 or email thomas@ng-cs.com