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Understanding the Emerging Managed Office Market

Fri, 21 Nov 2025 14:54:59 GMT

As demand for sub 10,000sqft furnished offices rises, its time to understand how office management companies operate.

Avoid the voids, by changing your real estate strategy.

Flexible working will equate to c.20% of all commercial real estate occupancy by 2030.

Demand in flexible working has what seems to be an unstoppable momentum. This shift has also seen a rising demand for pre-fitted spaces, typically presented as CAT A+ or CAT B. However, to capture this new market demand, landlords can't just add kitchens and desks to bridge the gap from CAT A models.

The demand is intrinsically linked to overall amenity, management of services and the legal routes to occupy the space (licences/short form lease/management agreements & traditional leasing).

Understand Demand

In recent years the demand and size of requirement from occupiers of traditional flex space has shifted.. Typically an occupier (typically progressing from a serviced office), would be looking for anything from 1,000-3,000sqft of furnished workspaces. The demand was typically for short term arrangement from 1-3years.

However, transactions are now being regularly completed on spaces from 3,000-10,000sqft and for 3-5years. What hasn't changed is the requirement for flexibility and simplicity, over rate.

The most in-demand requirements today are typically between 2,500-5,000sqft. The offices rich in amenity (either shared or dedicated), a driving high demand and rate. Management companies skilled at delivering service led office spaces have been crucially intrinsically linked to the success of fitted managed office spaces.

Meeting Demand

The obvious route might be to partner with a flex management company. These emerging suppliers are filling the widening gap between serviced offices and traditional leases. They are skilled at delivering service lead office solutions, to occupiers wanting a simple office model, at scale but aren't ready to take a lease.

A management company will assess your space(s) and suggest what needs to be improved (fitout, amenity, utility etc.) to capture the emerging demand.

Typically, there would be an investment case to consider, which will balance investment vs return. Its commonly accepted that a lease will only yield income from 8 out 10 years on a lease. A flex model could reduce the void period by 1 year, so its essential to understand the commercial mechanics before investing.

Understanding the legal framework.

The most common method is to lease your space to a management company . They will want expressed terms to 'sub let' by way of a licence agreement, back to their client. The sole purpose of the lease will enable them to licence back the office space and manage the clients services for a management fee. The Alienation clause will set out this right and terms around the clients covenant.

By partnering landlords can expect to see a reduced void period, higher rent returns &SC returns plus mitigating business rates exposure.

Landlord - Receive Rent & SC payments as normal. If they've agreed to furnish the space first, then they can potentially expect increased rental contributions, in order to return initial CAPEX investment improvements.

The management company - They will deal with BR, utilities, services, maintenance and any other requirements their client demands. The licence agreement or short-form lease will cover their costs in the management fee.

Other management companies might ask the client to sign the lease directly with the landlord and an addendum will be created in the lease, referencing the management companies contracted services. The appended document will reference the management companies obligations to the client and their fee's.

Conclusion; The traditional CAT A office unit is struggling to compete against its furnished, managed and amenity rich competitors.

The traditional sub 10,000sqft office world is changing, will you be ready to meet it head on?

Got a Void you want to Avoid?

Wed, 19 Mar 2025 11:01:42 GMT

Flexible working experts can give you a competitive edge and reduce risk when considering a route into Flexible Working.

First hand experience & working knowledge of the flexible office sector is gold dust for any new and emerging landlords considering a move into Flex . With ever increasing void rates, its very tempting to switch a traditional leasehold stock into a flexible working product. Of course there are numerous factors such as capex spend and concept design that needs laser focus.

Entering the flexible working sector can be a daunting venture, involving considerable capex investment and risk but the ERV (estimated rental values) can be really worth it. Not only can it add desirable amenities to a development or building but it can potentially increase your asset valuation and ultimately profits.

Flexible working experts can offer you everything from feasibility work, financial planning & modelling tools, marketing support & reports, crucial fitout and design advice, understanding technology & data and so much more.

So, if you're planning an entry into this dynamic market, get some trust advice first!

I've personally been at the coalface for almost 13years now. Directing multi-site operations, opening in new markets, recruiting top tier talent, brokering enterprise office deals and advising landlords on entering this risky, yet lucrative market. if you'd like to chat about a space or building or would like some advice on who to speak to, get in touch.

Is your office worth the commute?

Fri, 01 Nov 2024 15:29:34 GMT

Employers...

How can you demonstrate that the commute is really worth the time wasted travelling?

Working from home has now been widely accepted in society as the norm, with many people now choosing who they work for based on there flexible working polices. The convenance of rolling out of bed into the home office, not having to rush about dropping the kids to school and avoiding travelling in all weathers, are just some of the compelling factors of flexible working. For most, a decent IT connection and a reliable laptop enables you to work effortlessly in the home office or even on the dinning room table.

If employees value the benefits of flexible working it will be very difficult to re-enforced a FT office policy. Employers who have mandated it do so if its business critical or operationally necessary.

So how do make an office compelling? In short, you need to prove it is better than working at home!

Evaluating your workspace

If you're a employer struggling to articulate the benefits of working from the office, then you need to consider the physical office offering and holistic benefits of getting everyone in every or most days.

So what should you consider when evaluating your workspace offering?

Service and Standards, Is your office space quality and run by contentious professionals
Amenities & Facilities, Does it offer phone booths, focus areas, a gym, meeting rooms, break out spaces, bike racks, showers etc...
Connectivity, Does your supplier offer a robust WIFI and secure IT connection
F&B, Can staff access a decent Tea or Coffee and a well stocked fridge or café onsite
Location, Is parking easy or within a 5min walk from a train or bus stop
Workspace, Do you have enough quite work areas, Zoom booths and desks to accommodate everyone or use desk booking app.
The Local Area, Are there places nearby to socialise, meet colleagues and clients

How can you promote the benefits of physically attending the office?

Collaboration, is good for both the business and personal development
Improved Opportunities, being closer to the business can often lead to more career development
L&D, holding onsite training is typically more interactive and productive when face to face
Wellbeing and Mental Health, for some a commute might be the only exercise they get and seeing colleagues before, during and after the working day can be positive for mental wellbeing
Building company Culture, by working fact to face in a collaborative manner can help foster a positive company culture

So, before you make an internal decision to 'mandate' a return to the office request, you might want to review all these factors and consult with your workforce on exactly what matters most to them.

Watch my workspace wisdom presentation

Wed, 11 Sep 2024 08:13:04 GMT

If you're an operator looking to expand your Flex business this seminar is for you

With feedback from those watching live including ' very useful', 'brilliant, very interesting' and 'excellent presentation', this Workspace Wisdom Webinar is well-worth catching up with!

Flexit MB Consulting shares great advice for flexible workspace operators interested in expanding their services or opening in new locations. Find out more below, including the link to the recording.

(6) FlexSA Wisdom Webinar - Top tips for Flex operators in expanding and exploring new markets - YouTube

Flexit is presenting a Workplace Wisdom Seminar

Thu, 18 Jul 2024 08:18:04 GMT

TOP TIPS FOR FLEX OPERATORS IN EXPANDING AND EXPLORING NEW MARKETS

Tuesday 10th September

11am-12pm

I'm delighted to have been invited to present for Flexsa on their ‘Workspace Wisdom Webinars’. I will be offering advice and tips for workspace operators looking to explore new markets.

Amongst booming customer demand and an increasingly competitive flex market, many flexible workspace operators are looking for opportunities to grow their business.

What factor should be considered when entering new markets, and what steps can be taken to make the best possible business decisions?

Having specialised in the flexible commercial real estate industry for over 15 years, I will be utilises my broad experience to offer professional advice and guidance to help businesses adapt and flourish in the world of flexible working.

In this webinar, I will share advice and guidance on navigating growth in new markets and diversifying offerings within an established flex business, with the aim to get your business ‘plan’ ahead of the game against the competition.

Click here to reserve your place , after which you will receive a unique link to attend virtually.

Workspace Wisdom Webinar - Top tips for flex operators in expanding and exploring new markets - Flexible Space Association (flexsa.co.uk)

Is your building ready for flexible working?

Fri, 01 Mar 2024 13:10:59 GMT

The Management Agreement can offer landlords easy access to a rapidly growing market.

If you’re considering entering the flexible working environment to reduce voids, then you will probably encounter the ‘Management Agreement’. The Management agreement is rapidly superseding the traditional FRI/SPV leasing format for flex operators looking for their next location.

Operators such as IWG (Regus, HQ & Spaces), Orega & Boutique Workplace are now primarily only seeking management agreements. There are several ways to structure the management agreement but put simply they are based on profit share models between the operator and the landlord.

Leveraging Industry Expertise

A management agreement provides landlords with a convenient way to enter new markets by collaborating with an operator. This partnership allows commercial real estate investors to expand and diversify their offerings, leveraging the expertise of an operator to mitigate the operational risks associated with managing flexible office spaces.

A competent operator begins by working closely with the landlord to understand their objectives. By doing so, they can effectively contribute to achieving those goals on behalf of their client. Striking a balance in management agreements that addresses the needs of both the operator and the landlord is crucial for instilling confidence in the flexible workspace sector over the long term. Ultimately, this confidence will drive the necessary levels of activity to meet the increasing demands for flexibility from today’s workforce and their employers.

Before entering into a management agreement, it is essential to establish an open dialogue between the operator and the landlord from the outset. Both parties must clearly define their respective responsibilities, comprehend the associated risks and rewards, and align their efforts to achieve short- and long-term objectives for the workspace. Seeking independent advice before engaging with operators is advisable, as it allows an advisor to assess the feasibility of converting vacant space.

Tip: Seek independent advice from a flexible working expert before engaging with operators. A feasibility study will analyse your stocks potential to enter into a new market and what ERV can be achieved.

Fostering Growth

In the short term, both parties must fully grasp their obligations within the agreement. For instance, they should determine who is responsible for developing and approving the proposition, designing the space, planning and managing the fit-out project, launching the new space, devising sales and marketing strategies, and setting pricing and operational standards. Clear delegation of specific roles within the contract is essential.

Each operator operates with its unique business model, which should outline projected income, operating costs, and expected returns. By understanding these factors, both parties can work together effectively to achieve sustainable growth in the flexible workspace industry.

Tip: it is also advisable to set measurable milestones that will trigger options to exit an arrangement or reduce the level of fee’s payable.

If you’re interested in reading more about the growth of management agreements and what customers expect from their flex space, check out this report from Savills. The Workthere Flexmark 4.0

Office Space Terminology Explained

Tue, 03 Oct 2023 12:45:11 GMT

The confusing terminology around renting offices explained.

You will often see a non-Serviced Office space described using the term CAT A but what does it mean?

CAT A represents a standard, open plan Landlord finish, decorated, with ceilings, services and lighting installed
CAT A+ indicates the possible addition of a kitchen, some fit out, a range of furniture and the installation of data and small power wiring (either perimeter around the walls or ideally under the floor)
CAT B represents a fully fitted and furnished unit with small power wiring and live comms wiring installed - This is also called Plug and Play.

There has been a big movement away from Leasing towards Managed Offices, what are they?

Typically a CAT A+ or B finish
All-inclusive pricing, so rent, rates, service charges and all the running costs wrapped into one simple price.
Unlike leasing, a management company deals with maintenance and billing for you.
Often available for terms from 12-60months
Avoid all the complicated legal wranglings, searches and stamp duties (SDLT) than come with leasing
Limited responsibility to end of contract 'dilapidation' requirements

Dedicated Bandwidth - Non contended IT connections, what's that

Flex Office or Serviced Office providers will generally offer you a share of their IT line. This is often over charged and unless you pay £100's of per month, is often reasonably limited, albeit will suffice.
1 Gig Line, the basic size of Internet fibre pipe that can be brought into a lease or managed office. Priced by the megabit, 250mbps is usually around £250pcm, a full 1 Gig line is around £400-500pcm.
Line of sight, this is essentially a fast IT provision provide via satellite. The IT connection is beamed over the roof tops as an alternative. It is generally more expensive but can be installed very quickly (if a wayleave isn't required)
A 'Failover' line, is a backup upline provided to your building from another providers exchange. If the primary IT line is accidently cut or disrupted, the other line will immediately take over your supply.

If you're considering a Lease or Managed office solution, there are so many options available. Leases are coming down in their average term length from 10-20years to just a 7year average term. A tenant search service will cost you around 8% of the 'headline rent' as finder fee.

Managed office agreements are typically being taken for 3-5years, with breaks from months 24 onwards. As they are catergorised as flexible solutions, there are no search fees, as these are often sourced via brokers and agents who are paid by the providers.

The office is still King

Fri, 22 Sep 2023 08:35:55 GMT

The benefits of having an office HQ - its not just about brand presence and great coffee.

CEO's and business leaders are constantly plagued with today's challenge of balancing the financial savings of hybrid working vs the need to create a thriving environment for your people. Are you?

The demand for office space is back to pre-pandemic levels and the key driver is people centric metrics. You don't need to be in the office full-time to reap the benefits of having one.

More and more SME's and medium sized businesses (30-60 employees) are choosing managed offices over long term leasing and here's why.

Team Culture and Collaboration:
Face-to-Face Interaction: Being in the same physical space allows for spontaneous and informal interactions, fostering stronger relationships among team members. These interactions can lead to better communication and collaboration.
Team Building: Office environments often provide opportunities for team-building activities, workshops, and social gatherings, which can strengthen team cohesion and camaraderie.
Immediate Feedback: In an office, you can easily walk over to a colleague's desk for quick discussions, brainstorming sessions, or to provide immediate feedback, which can speed up decision-making and project execution.
Recruiting Top Talent:
Professional Image: Maintaining an office space can project a professional image to potential employees. It can signal that the company is stable and invested in providing a conducive work environment.
Access to a Larger Talent Pool: Having an office allows companies to tap into local talent and recruit individuals who prefer or require an office setting. This expands the pool of potential hires.
Onboarding and Training: In-person onboarding and training sessions can be more effective, allowing new employees to acclimate to the company culture and build relationships with colleagues more easily.
Wellbeing and Work-Life Balance:
Separation of Work and Home: Working from an office provides a clear separation between work and personal life, reducing the risk of burnout and promoting work-life balance.
Ergonomic Workspaces: Offices are often equipped with ergonomic furniture and equipment, which can contribute to better physical health and comfort for employees.
Routine and Structure: Office work often follows a structured schedule, which can help employees establish routines and maintain a healthier work-life balance.
Mental Health Support: Some offices offer mental health support and wellness programs to help employees manage stress and maintain their mental wellbeing.
Networking Opportunities:
Industry Events and Conferences: Being in an office location can provide access to industry events, conferences, and seminars that can enhance professional development and networking opportunities.
Professional Associations: Employees working from an office can join local professional associations, further expanding their networks and staying updated on industry trends.
Access to Resources and Technology:
Specialized Equipment: Certain industries require specialized equipment or facilities that are typically found in office environments. Having access to such resources can be crucial for productivity and innovation.
Stable Internet and Infrastructure: Offices are equipped with stable internet connections and IT support, reducing technical disruptions and ensuring efficient work.

It's important to note that the benefits of working from an office may vary depending on the nature of the job, industry, and individual preferences. Many companies are adopting hybrid work models that allow employees to enjoy a balance between office and remote work to harness the advantages of both approaches.

Flexit works side by side with business leaders to source the best office options for their needs and budget. Do n't sit o n a non-productive half empty office, find a solutions that ticks all the boxes and take control of your real estate.

Re-thinking your workspace

Tue, 07 Feb 2023 17:11:49 GMT

Top Tips for creating a great flexible and happy workspace.

Here are some top tips, if you're looking to reimagine your current lease hold office space or planning to downsize your current office.

Think Holistically

- Avoid desk planning for your entire head count unless absolutely necessary. Successful modern workplace cultures often foster collaboration and productivity through multiuse work environments.

- Create multifunctional work areas. Create brainstorming areas, hot desking zones, private spaces, open working areas for teams, formal and informal meeting rooms and advanced IT allow desk booking management and online working.

Do more, with less

- monitor your onsite access activity before planning. It's very common today for employees to work 3 days in the office and 2 at home. The typical office utilisation can fluctuate from as little as 15% on a Friday to 70% on a Wednesday.

Empty offices are dull, cost money and are not generally productive and healthy places to work
Ask teams to structure their weekly visits to balance out office occupancy
Ask colleagues to use online meeting platforms like Teams or Zoom to fee up non-essential board rooms, saving you money!
Look to adapt your current Job Descriptions to enable hybrid working and encourage homeworking, when possible
Consider hot desk memberships or small cheaper satellite office spaces for those wanting to work near home. Apps like NearU allow seamless access to desks, meeting rooms and offices nation wide.
Review your working policies and ensure it is aligned to your recruitment strategies for hybrid and office working.

Enable a healthy and happy workforce

- Review your wellbeing strategy, healthcare policies and physical work environment. Boost your staffs productivity by improving access to a verity of amenities and wellness programs.

Look to add or adjust your private medical plan to incorporate free or reduced price gym memberships. Schemes like Vitality Health are great for promotions like this
Review the onsite facilities before taking a new office. Look for wellness rooms, gyms, café areas, Zen rooms, Prayer rooms, Studio spaces, outside space and even the types of foods and drinks sold in onsite cafes
Add more optional work perks, like charity work days off, offsite team building events, cycle to work schemes, appoint a mental health awareness person (check out Mind ) or allow pets into work or certain days

Ultimately, there is huge amount of activity and work that you can do to improve workplace productivity and wellbeing. Simply start with creating a productive and welcoming workspaces and ask your team what they'd like to see!

Choosing the right partner for your office portfolio

Tue, 24 Jan 2023 19:49:16 GMT

What to consider if you have vacant properties in multiple locations

Landlords with long term voids often enquire as to whether or not their buildings are suitable for a flexible working product. The initial research is conducted on the location, demand, desk rates and competitors in their market place. This is all vital, however it is then essential to screen the right partners, if considering a profit share or management agreement. Not all potential partners, despite their interests, have the best fit skills, expertise and product DNA for all locations.

The type of buildings within your portfolio, their location and history will guide the types fitout/design and ultimately then a short list of potential partners.

Common building types::

Traditional Business Centre - Modern in design, function, modest density, smaller breakout areas, small/medium level of amenities, contemporary design, mainstream appeal, c.7,000-30,000sqft medium priced. Provider Examples Regus ( IWG ), Orega , Clockwise , BE offices or Boutique .

Modern Coworking - Higher density offices, expansive breakout areas, in busy communities, good range of amenities, vibrant design, Broad clientele, c.3,000-25,000sqft medium to high priced. Provider Examples WeWork , Work.life or Runway East

Design Led - Strong identity, high density offices, prominent location, unique amenities, architecturally strong, quality breakout areas, sustainable, Quality Tech, Niche Clientele, c.15,000 - 25,000sqft High priced. Provider Examples Uncommon or TOG

Innovation Hubs - (Niche) High and Low Density offerings, big conference areas, shared work studios, welling areas, breakout spaces, share tech facilities, over c.25,000sqft, Varied price ranges. Provider Examples Plus X or HERE .

Consumers of flex spaces are considering a huge variety of variables when selecting a new office space. These variables will form part of a providers 'key differentials' too and reflect in their overall product DNA.

So what are the variables influencing the occupier when selecting a flex space?

Client Variables:

Building - Types of Amenities, Location, Demographics, Accessibility, Price, Green Rating, Design & Style, Technology...

Human Factors - Productivity, Quality of Environment, Wellbeing, Talent Attraction, Employee requirements...

Economy: Interest Rates, Inflation Factors, Wage Factors, Cost of Office, Investment, Recessions Risk, Growth...

Therefore, its important to understand what type of building you will create, who it's primarily being marketed too and the level of fitout and investment required.

Office space is no longer just a functional work environment, it must add specific value to its occupiers and appeal to rapidly changing working trends. If you're a Landlord, get involved with your building and location, take time to understand what your future occupiers are looking for and evolve.

What's Driving Traditional Landlords Towards Flex?

matt@mbspropertysearch.co.uk (Matthew Blair) — Wed, 09 Nov 2022 10:28:28 GMT

An Institutional Leasing Model Is Forced To Flex

Flexible working agreements are continuing to be increasingly popular with office workers in the UK, with economic, technological, and social trends encouraging this development to grow.

As direct result, the traditional long stay leasing agreement for SME's and Corporates is losing its appeal, as the cost benefits are being outstripped by emerging trends & global economic influences.

Flexible working trends

· Four Day Working Week – There is clearly a growing trend of the ‘four-day week’ being introduced in UK businesses

· Remote & home Working

· Flexible hours

· Unlimited holiday (and maternity/Paternity leave)

· Flexible Dress Codes

· Sabbaticals or extended vacations

· Office sharing schemes and desk hire app’s (Short stay & PAYG)

Economic factors

The Bank of England warns of longest recession in 100 years, with the recession now expected to last until the middle of 2024. With that the uncertainty could persist for years, not quarters, and that employers will continue to prioritize flexibility, as they look to determine when, where, and how employees will utilise office space going forward.

As void rates grow in the traditional commercial leasing sector, more and more CRE owners are looking at flexible working solutions to fill space. In recent years that has taken the form of Management Agreements, direct Leasing to established Flex Providers, Profit Share arrangements and now Landlord Operated Spaces or Brandlord's, as they are being called.

Time to Flex?

Forecasts are predicting that almost a 1/4 of all office space will be catergorised as 'Flex' by end of the decade. Typically, the ROI on a flex model should yield around 25-30% compared to traditional office leasing portfolio.

It's good advice to therefore consult with a 'flex expert consultancy' to assess your portfolio and local market demand. They will be able to advise on the best operating models for you, support your business planning requirements, introduce you to specialist flex providers (for vital infrastructure and equipment needs) and support you on how and where to market your new flex offering.

For more information on Flex models and how to create a flexible working product, check out our other blogs/articles or get in touch.

Save money, improve desk utilisation and increase workplace efficiency

matt@mbspropertysearch.co.uk (Matthew Blair) — Mon, 03 Oct 2022 12:20:48 GMT

As organisations look to reduce real estate costs, companies like WeWork are responding with new agile working software.

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Planning your office layouts that meet local demand

matt@mbspropertysearch.co.uk (Matthew Blair) — Mon, 30 May 2022 09:44:08 GMT

Knowing your local office market is an essential part of any feasibility study, so before full fitting out your floors do some research on demand.

Never assume that 'if you build the space they will come'!

Before building your office floors to meet an unknown flexible office market, make sure you seek expert advice to understand the local lead flow and DEMAND.

In a recent assignment we eventually advised the landlord to only fit 2/3 of their office floors, leaving 30% of the office space to be sold 'off plan'. When you're unsure what the demand will be, create it around the enquires and save money on build costs. There is also something special for a client to be able to create their own space, that perfectly meets their flexible working requirements.

Most serviced offices will have a variety of suites, breakout spaces and coworking areas to cater for a variety of enquiries. However, if your bringing a new product offering to a market, you must know the demand before building

Most serviced offices will need:

Private offices 2-30desks - the mix depending on building layout and local demand
Desks - Some fixed for coworking, small ones for high density (1000mm), 1200-1400's standard stock and 1600mm on demand for exec office requirements.
Reception area - waiting area, refreshments, welcome suite (if there is space) and some storage for the Centre Manager
Break out areas - tea and coffee points to work, relax and meet
Kitchen points, with space to sit and relax
Hot and Fixed coworking desks - with some storage lockers
Phone booths or quite areas
2 Meeting rooms (1-4 and Board room)- again, sizes and how many once you understand demand
Outside space - bike storage, seating, smoking, socialising
IT/Comms room
Toilets with showers is a bonus
Other nice to haves - Gym, relax or prayer rooms, VR suites, Zen rooms and exercise studios

To Flexit or Not?

matt@mbspropertysearch.co.uk (Matthew Blair) — Fri, 27 May 2022 12:00:23 GMT

If your concerned by high void rates and now considering converting your assets into a flexible working centre, then check out out these tips.

After running Flexit for 6months now, we've spoken to a variety of developers and landlords about their estates. One of the most common question is 'will my building work as a serviced office'? The answer isn't always yes, as there are many variables to consider from location, build costs, issues with internal management frameworks, structural restrictions, planning or build restraints and access to facilities like parking.

Despite these variables, in the main a good deal of empty buildings are suitable as flexible working centres.

Before embarking on this journey, its essential to do three things:

- Conduct a feasibility study on your building (looking at ROI, Costs, infrastructure and Infrastructure required for operating

- Appoint an experienced marketing company to research demand, desk rates and scope out your brand offering

- Decided on who is managing it, run it internally, appoint a managing agent or consider a JV or Management Agreement with a trusted operator.

Check out the slide that list some of the benefits of moving your assets over to flexible working.