Amsterdam,
29
November
2021
|
14:23
Europe/Amsterdam

Flexibilisation of the office market can give the flex office market a new impulse

Amsterdam has the largest share of flexible office operators in major European cities after London

The total area of flexible office space in Amsterdam amounts to 290,000 sq. m. With a total occupied stock of 6.4 million sq. m. of office space, that equates to a market penetration of 4.5%, according to the EMEA Flex Report 2021. That is a more than double compared to 5 years ago.

 

After London, Amsterdam is the city with the highest share of flexible office operators. The differences are large: in cities such as Paris, Berlin and Madrid the share is less than 2% of the total office market.

Tech companies and flexibility driving future growth
Fast-growing companies in the tech sector are the main driving force behind this highly developed segment of the office market. Bart van Eerd, Director A&T Office Amsterdam of CBRE Netherlands: “The growth in recent years has come mainly from the start-ups, scaleups and international tech companies that often establish themselves with a flex operator and/or continue to grow there. The office space needs of these growing companies are in line with the more flexible contracts offered by flex operators.”

New flex products to meet changing demand
The flexible office operators, in turn, are anticipating the changing demands of office users. Providers are aware that the shift to hybrid working will have consequences for the scale and type of product they offer. Together with office users, the operators are testing new niche products and pricing structures such as pay-as-you-go instead of the standard short-term lease contract per desk or space. They are also conducting research into healthy and productive workplaces in order to reach price agreements with users based on productivity.

For office building owners, these developments mean that the standard long-term contracts with flexible office operators are becoming less common. Management contracts with revenue and risk sharing will be discussed at the negotiating table more and more often. For owners of hotels or shopping centres, for example, the search for product innovation means that they too can start leasing space to flexible office operators.

For example, Frank Verwoerd, Head of Research at CBRE Netherlands, indicates that “The flexibilisation of the office market in combination with hybrid working may contribute to the continued growth in the share of flex operators on the Amsterdam office market in the coming years.”