As the UK property market enjoys relative stability, now is the time to invest in flexspace says IWG’s Clare Sowerbutts
The phrase “Brexit means Brexit” sums up the ambiguity that has lingered over the UK property market since 2016. However, since the UK left the EU in January, there have been early signs of the industry stabilising – positive news for property developers and landlords in Britain.
And for London in particular, things are looking up. According to property firm Carter Jonas, over-anticipated demand for office space in the UK capital is forecast to outpace supply in 2020. For developers hoping to capitalise on this fresh appetite for London workspace, it’s well worth exploring the possibilities of the rapidly growing flexspace sector.
Clare Sowerbutts, Development Director for IWG in London and the Southeast, reveals that, when it comes to flexspace, a sense of post-election stability has returned to the capital, and corporates who were holding off on adding flexspace to their real-estate portfolio finally feel able to act. “Demand is buoyant across the Central London markets,” she says. “Prior to the UK’s general election in December, decision-making was stalled and there was some procrastination amongst some clients. Now there is a government with a healthy majority, clients are committing to space speedily and with renewed confidence.”
Flexspace is particularly attractive to companies during times of economic uncertainty. Unlike conventional office space, it allows businesses the option of shorter leases, and the chance to easily upscale or downsize the amount of workspace they’re using in line with their business outlook. The evidence suggests that companies based in London are keen to find out more – but are looking for a reputable flexspace provider with a proven track record of stability during challenging times.
“An increasing number of enquiries are from larger corporate clients who are starting to realise the benefits of flexing at least a proportion of their total office space,” says Sowerbutts. “IWG has been around for more than 30 years and we’ve seen numerous economic downturns. It’s at those times that businesses, irrespective of size, become risk-averse, and don’t want to commit to long leases and burdensome occupational costs. Businesses want the flexibility and control of costs which IWG provides.”
IWG’s multi-brand proposition is well-suited to the diversity of London’s industries. It means property developers can assess which kind of working environment would be most attractive to businesses operating in different London neighbourhoods – be it upscale offices at a Signature by Regus location, or creative coworking with Spaces, for example.
“Location-specific demand remains in London, with media and creative companies preferring the West End, whilst the financial and insurance industries tend to gravitate to the City,” says Sowerbutts. “Fringe Central London locations continue to increase in popularity with a strong level of enquiries for areas such as Farringdon and Angel, and Victoria, where IWG is well-placed to cater for demand with an impressive new Spaces having opened in the past 12 months.” As Sowerbutts points out, it all comes down to choice: “IWG’s multi-brand offer of Spaces, Regus, Signature, No18, HQ and Basepoint provide a range of price points, locations and working-style choices for our clients – there is a product for everyone.”
In June, Sowerbutts will join other regional development directors from IWG at MIPIM, Europe’s leading real-estate event. It’s a chance to meet potential partners looking for dynamic opportunities in property, and see if adding flexspace to their investment portfolio might be the answer. “MIPIM is a great opportunity to meet landlords and developers, talk about our business and brands, and unearth property and partnership opportunities to enable us to build a pipeline of new centres for all IWG brands,” she says. “We have a substantial network of around 325 centres in the UK and 3,500 globally, providing an outstanding service for clients with, and aspiring for, international presence.”
Interested in incorporating flexible workspace into your real-estate portfolio? Set up a meeting with the IWG team at MIPIM or get in touch with us online today