In the last four years, we have seen flexible space stock increase significantly in New Zealand as part of a growing trend across the whole of the Asia Pacific region. What do we mean by flexible space? Here’s everything you need to know about this fast growing sector.
What is Flexible space?
Flexible space typically means workspaces that fall outside of what we would understand as the traditional ‘office’ model. The ‘flexibility’ of this space refers not just to the physical layout but also the agreements in place. Co-working spaces, serviced offices, or liquid space, are all examples of flexible space available on the open market.
Flexible space has a tendency to be open plan with each unit available as an assigned workstation or hot desk, however it can also include small, enclosed offices, or even whole floors. The managing of flexible space is also varied. Many spaces are managed by specialist operators but an increasing amount is managed by individual landlords or in some cases, partnerships between specialist providers and landlords. There are also situations where a tenant has the right to sublease part of their office which is described as liquid space.
How much flexible space is there in New Zealand?
JLL research on flexible space was examined the Auckland market, where there is currently just under 50,000sqm of flexible space stock. The Auckland market recorded growth of over 300% in flexible space between 2014 and 2017. However, flexible space providers now operate across all of New Zealand’s major cities.
What is driving demand for flexible space in New Zealand?
In the past few years, New Zealand has developed a reputation as a growing hub for technological innovation and an attractive place to launch new enterprises. These kinds of operations have required flexible, collaborative and cost effective solutions for their office space which has seen the rise of co-working and serviced office space to meet these needs. It looks like demand for this space is going to increase and here at JLL, our regional research team predicts that as much as 30% of corporate portfolios could be in flexible space by 2030.
How is co-working office space different?
Co-working space aims to provide a layout that prioritises networking and a sense of community. A lot of emphasis is placed on the experience of the employee meaning that there are generally greater amenities in co-working spaces than traditional offices such as shared meeting rooms and social areas. While the dynamic and interactive environments of co-working office space have traditionally attracted a number of entrepreneurs, freelancers, and smaller start-ups, our research indicates that corporates are increasingly investigating co-working spaces as a way to foster innovation through exposure to new business concepts and the cross-pollination of ideas.
How do serviced offices differ from traditional office space?
Serviced offices are similar to traditional office space in that they are typically more formal and corporate in nature – housing established businesses and multinational corporations. Serviced offices differ in the sharing of resources within the building. For example, many serviced office buildings include access to business equipment like copiers, audio-visual equipment, and meeting rooms. Increasingly, however, we’re seeing new serviced offices adopt concepts and designs commonly associated with co-working, such as communal spaces.
What are the advantages of co-working or serviced offices?
Many organisations within New Zealand continue to utilise the community aspect of co-working space to their advantage. Placing their enterprises in ‘tech hubs’ gives many businesses the opportunity to gain access to an established network of digital technology and apps - creating cross-selling opportunities and innovation.
In a competitive employment market, utilising this kind of space allows companies to attract and retain young talent who are increasingly drawn to the attractive collaborative features of co-working space.
For larger companies in need of flexible solutions, utilising serviced offices with co-working space provides the ability to move in and out of office space at short notice without being constrained by longer term lease commitments.
For example, the short-term contracts associated with these spaces offers flexibility for project or sales teams that are looking to expand or consolidate their operations - not to mention the opportunity to reduce upfront capital expenditure and deposits.
How can I find out more about flexible space?
You can find out more about flex space and its impact on the whole Asia Pacific region by downloading the full report at the bottom of this page.
How can I find flexible space?
Explore the related properties on the right hand side of this page or ‘Search for flex space’ to view all our flex space stock and find your solution today!