Flexible working is growing rapidly with International Workplace Group’s (IWG’s) continued expansion across its operating brands.
From Perth, Australia to Nagoya, Japan, the first half of 2019 has seen more rapid growth from IWG’s flexible workspaces brands. The company has established 156 locations across 34 countries in its operating brands to continue its mission to service an adjustable working revolution.
A report by consultancy firm The Instant Group found demand for flexible workspace globally increased by 19 per cent in 2018, stating the growth in the supply of adaptable areas was ‘the number one story’ in commercial property markets around the world.
John Williams, head of marketing at The Instant Group, put the growth down to two factors, a change in how large companies were operating—specifically in relation to flexible working practices—and changes to the nature of the workforce itself.
“It is a mixture of the increase in the contingent workforce—consultants, one-person bands, and start-ups—and the fact larger companies now work in a more agile way,” said Williams. “Businesses are now keen to offer their employees more choice in where and how they work and digital technology enables them to work anywhere.”
Reluctance by major companies to sign long-term lease agreements to stay financially flexible was also a driver, he said.
“Corporates are less keen now on signing lease agreements for the long-term as business cycles have become shorter since 2008 and companies have had to become more agile to adapt to this change,” said Williams. “This means being able to grow, and contract, quickly rather than be tied to one space for 10 years or more.”
According to the report, although there is a rise in the number of flexible workspaces, much of this footprint is still concentrated on the world’s major ‘global cities,’ with New York and London taking up the lion’s share of such available sites. Despite this trend, IWG’s portfolio of operating brands is continuing to expand into more developing markets, too. Since the turn of the year it has established new office space in places such as Braga, Portugal; Bilbao, Spain; Rennes, France; and Gdansk, Poland.
When it comes to the nature of the workforce driving the change in operating practices, many might perceive it centres on the creative sector, with visions of young app developers in casual clothes looking to avoid what they might feel to be a more traditional, perhaps even ‘stuffy,’ nine-to-five office culture. According to Williams, this is not what their research has found.
“There is a misconception it is millennials who work in the creative or tech industries who are driving this change. This is not the case at all,” he said. “We find in the U.S. and U.K., it is actually financial and professional services organizations who are using adaptable areas more than tech companies. It is larger companies taking bigger requirements of flexible workspace that are among the fastest growing segments of the flexible workspace sector.”
Although relatively nascent as a trend in the commercial rented sector with five per cent of the total office market, Williams suspects flexible workspace will make up 40 per cent of the market in the next decade.
He cites transparency around costs, an agile approach to expansion, contraction of the business and choice of location, a greater option in working environment, and a more engaging approach to design and atmosphere as some of the main drivers behind this expansion.
“Our estimate is flexible workspace will make up as much as 40 per cent of the total office market in a decade,” he said. “Market demand is growing by as much as 30 per cent each year in some global markets and it is our understanding the majority of companies are still not aware of their options in flexible space, they are still learning about the types of space they can access and the costs involved.”
All information listed in this section was submitted by International Workplace Group.
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