According to the "Flexmark" benchmark analysis of the "Workthere" brokerage platform from real estate consultant Savillis, the profitability of flexible workspaces is expected to increase worldwide. Even though occupancy rates for both open spaces and self-contained office units have declined in the year of the Corona pandemic, operators have increased profitability at the operational level. "Workthere" saw a drop in private office occupancy from 81 percent to 68 percent. Occupancy in coworking spaces has decreased from 65 to 56 percent.
It is encouraging that the providers of flexible workspaces have managed to remain profitable and successfully reduce their costs. Reasons for the cost reduction could be that rent-free periods have been negotiated with customers. Another way costs have been reduced is by switching from a lease to a management agreement. This switch eliminates high fixed costs and optimizes cash flow.
On the global market, it can be observed that in Asia and in Europe are the most profitable regions for flexible workspace operators. In Germany, private office leasing accounts for the largest source of revenue. Even though in the year of the pandemic, this sector saw a 6 percent decline, Savillis anticipated larger losses. To retain existing customers and generate new ones, operators offered discounts on contract renewals, for one thing. On the other hand, new customers were attracted with reduced prices. Thus, Savillis sees good future prospects for the sector.
Source: savillis/workthere
© photodune.net
