What is impacting commercial office space in 2023?
How commercial office space savvy are you? Read our latest research on the commercial office space market and top 5 current key requirements from businesses
2023 has been the year when our work habits have become more fluid than ever and a deeper level of reflection on what people want out of life is leading to more changes in the office than ever before. The Covid-19 pandemic was a dividing line between old and new ways of working, and we can see many changes on the horizon.
Read on to find out our five key trends impacting commercial office space in 2023…
Where else to start but with hybrid working. Lots has been written and said about this already, but the fundamental point is that hybrid working is here to stay. While this is causing big changes across many sectors, nowhere is that truer than the world of commercial property.
Research from the Centre for Cities in May 2023 shows that office workers in Central London are now spending just 2.3 days a week in the office on average. This is a trend that is here to stay and it influences everything else. If you are a business owner or office manager in 2023, you will have to keep the reality of hybrid working at the front of your mind and consider how it will influence your decision making.
Enhanced amenities, facilities and future-proofing
With regard to the latter question, one area that is coming under increased focus is the amenities and facilities an office includes. If you want to get people into the office, you need to give them something which they cannot get at home or they won’t be interested. This is where improved office features can pay dividends.
For example, at our Lynch Wood Park we have made a substantial investment to provide best-in-class amenities include stunning landscaped gardens, a restaurant, gymnasium, EV charging points and much more that make it the number one office location in Peterborough. This is an office building which places wellness, collaboration and community on a pedestal to provide a working environment which has a positive impact on people’s lives.
Similarly, our £7.5m investment into 1 Newbridge Square has created an office building unlike anything else in Swindon – an instant draw for prospective employees and a place where your current team will want to be. The former Zurich Insurance headquarters building has been transformed into a Grade A office and retail space designed to meet BREEAM ‘Excellent’, EPC A rating and Net Zero Carbon standards. It is a vision of an office building fit for the 21st century and offers a future-proof home for your business in the age of climate emergency and the ESG responsibilities which come with it.
Flight to quality
Related to the previous trend is what the Financial Times has described as a “flight to quality” in the commercial office sector over 2023.
Environmental qualities are more important to people than ever before and this is being reflected in people’s choices about which jobs to take. Combine that with the desire for better amenities mentioned previously and we are seeing the best offices generating a premium as demand grows for quality.
At FI Real Estate Management, all of our new office buildings and our redevelopment projects are designed to achieve the highest environmental standards to meet that demand and give businesses what they need.
Human connection has never been more important in the office than it is now. Part of the shift to a hybrid working pattern is a need for better collaboration and co-operation which manifests partly in the type of spaces people want.
The days of everyone sticking rigidly to banks of desks are gone. Instead, employees want a variety of spaces that they can adapt to suit the needs of different types of work throughout the day.
Flexible and shorter leases
The overall move to flexibility is also manifesting in the contracts that are being offered by many offices. It is now common to be able to sign a short-term lease on more flexible terms which can be scaled up or down to meet your needs more easily than a traditional, long-term lease. With these leases, companies are not paying for empty space and can expand how much office they take as they need it rather than trying to forecast ahead.
However, this is not to say that only flexible, short-term contracts are being offered. For many businesses like large professional firms, a longer-term lease is still preferable – but it is more the case than ever that flexibility is now being offered by landlords in a way that it wasn’t before. This is a trend that has emerged into the mainstream over 2023 and will stay there for years to come.