James Rankin, Head of Research and Insight at The Instant Group discusses the UK flexible workspace market and overcoming challenges with data.
In the current market, there is a growing emphasis on data within the industry, particularly in recent years. Industry data is becoming crucial for decision-making and strategy across five key areas:
- Third-party verification for landlord or investment negotiations
- Revenue modelling for business planning
- Identification of markets with lower or higher risk for growth
- Internal stakeholder management to support sales or set expectations
- Identification of under or over-performing assets or spaces
The need for more clarity and visibility of market data is common with the demand for data-driven decision-making increasing. The flexible workspace sector faces challenges with cautious investors and softening business investments across commercial office, but there is still interest in investing in flexible workspaces despite the challenges.
Although there is an appetite for investment, the industry is not growing at the expected rates due to increased nervousness and a need for precise data on what constitutes a good investment. This extended decision-making process hinders the growth of the industry.
One valuable data type is occupancy or vacancy rates in a given market, which shows positive trends with flexible workspace occupancy rates at their highest levels. However, overall supply growth in the sector could be faster, leading to limited expansion.
Demand volumes are also key indicators. City centres rebound or stagnate, while suburban locations show mixed fortunes. Tertiary cities, traditionally undersupplied, exhibit strong demand growth, making them appealing to asset owners seeking additional value. However, primary and secondary cities face stiff competition due to quality stock and large market size.
Data-driven decision making
In this dynamic market, data-driven decision-making becomes crucial for flex operators and asset owners to navigate the complexities and make informed choices.
As the industry stands at a tipping point, understanding specific trends can make all the difference between profitability and stagnation. With average rates across the UK flex sector remaining relatively stable, the devil lies in the details—data-driven insights help identify markets with the highest potential for new space to be successful.
The increased availability of traditional spaces with increasingly flexible terms is putting pressure on the flexible sector. However, there is still ample opportunity for small to medium businesses seeking flexible solutions. Operators can now access tools like CoworkIntel, the industry’s most comprehensive market intelligence platform, to optimize rates, maximise occupancy, and make informed decisions whether it be in relation to existing assets or future growth strategy.
Want to learn more? Join the CoworkIntel operator data alliance pilot: contribute your data in exchange for access to market data and insights. Click here.
Watch the full webinar to learn more about how data can inform your decision-making process.
