The one thing we do know from the EU Referendum result to leave is that it could take up to 2 years to fully exit the EU after Article 50 has been triggered. The uncertainty has not only caused worry and concern for people but for many businesses too.
Business owners currently looking for leasehold office space have a tricky decision on their hands. Do they continue to look at longer term leases or move to a more flexible solution? Some of our clients have already decided it’s not worth waiting any longer to see what plays out and have taken workspace. Many others are now seriously considering this type of space due to its flexibility. We have documented in a previous blog about the huge rise in serviced office space across the UK with the industry set to be worth up to 126billion in the next 10 years.
It’s no surprise that flexible workspaces are popping up everywhere, due to their affordability, flexibility, networking ability and locations. It’s fair to say there is no worse time for businesses to commit to long term office leases. No one can predict the impact of Brexit on property values across the country, so purchasing or leasing office space is risky business. As we have experienced in past recessions we have to maintain a lean business plan making as much profit as possible and riding the wave. Tying businesses into 5 – 10 year leasing deals makes no commercial sense at all.
Experts are predicting the UK to develop relationships globally, outside of the EU when we finally leave– will such relationships require businesses to adapt their global footprint?
It’s clear we all need to think more flexibly about location, accessibility, business growth, overheads and workspace requirements. The main reason for the rise of co-working spaces and serviced offices is because there is less commitment involved. You can often break a contract with 4 week’s notice without any penalties. The traditional model is restricting business growth, strategy and has been called old fashioned. Along with increased lease rates this solution is no longer attractive.
Along with the 9-5 model, the hours people are working and level of freedom and flexibility needed to keep people motivated, balance work and life means serviced offices are a great support mechanism for this. The latest generation of millennials see flexible working options as a must-have. It seems the Brexit vote is the catalyst to further speed this process.
The current climate makes strategic business planning difficult. Having the choice and ability to flex workspace is key as businesses move with the times. Often scaling up and down on a regular basis. Forward-thinking businesses want to position themselves to flexibly ride out the current storm and see light at the end of the tunnel when the economy is more stable
“While it seems that no one knows the long term implications of Brexit it’s fair to say that the uncertainty and the lack of a clear plan (or at least the communication of one) has caused a fair bit of chaos. Add to the mix, ever evolving technologies and ‘disruptive’ companies, it’s becoming increasingly more difficult for companies to plan for the next 5 to 10 years which used to be the norm. Companies, now more than ever, need to be agile and able to adapt quickly to market conditions, trends and new technologies. A flexible workspace solution is just one of the ways that companies can mitigate risk in an uncertain time. It will allow them to adapt quickly to evolving market conditions, whether that be upscaling or downscaling. Occupancy rates in serviced and managed offices have been increasing faster post referendum so the evidence suggests companies are taking a more flexible approach to their workspace needs pre Brexit” said Lee Grodent, MD Loc8 Commercial.
If you are looking for office space pre Brexit and want to discuss how a flexible office solution could be the ideal solution then please do give our consultants a call on 020 3031 8563.