The shift to hybrid work seems to be permanent. Work is done at the office, at home, at clients’ facilities, in coworking spaces, and even on trains during commutes. This shift, coupled with cost-efficiency, is prompting organizations to downsize their office space. Mere walls and long-term leases are no longer attractive. Instead, user organizations are looking for workspaces that enable meaningful encounters and services that support employee well-being and a sense of community.
Beyond four walls
Coworking spaces have long challenged traditional leasing. They can be used flexibly on demand, and they provide a community, not just desk space. Alternative workspaces have been especially popular with small businesses, but larger organisations increasingly offer coworking memberships to their employees.
Much more could be done to support social connection in hybrid work.
Yet even coworking spaces struggle to support community building with the digital tools and technology currently available in them. Much more could be done to support social connection in hybrid work, and the real estate sector could seize this opportunity.
A competitive workplace service offering does not mean every workspace should have a yoga studio, luxury lunch options, or extravagant event spaces. User organisations can share spaces and services or allow access to their underused spaces. Here, too, lies an opportunity: real estate owners could facilitate sharing and increase cash flow through innovative solutions like multi-tenant leases.
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Creating value, not square footage
The sharing economy is already well-established in many sectors and has untapped business potential in the real estate sector as well. Sharing is indeed caring, as it can save both natural and financial resources. What’s more, space sharing is often socially motivated, unlike better-known examples of the sharing economy, including pay-per-use cars, bikes, or electric scooters. This makes sharing business models particularly well suited to the workplace sector.
The real estate business should view the workplace transformation as an opportunity rather than a threat. The days of tying a tenant to excessive square footage for years on end are over. In the future, the real estate players who succeed will be those who create value for their users. A valuable workplace adapts to user needs, supports employee well-being, and enables meaningful encounters.
If the real estate sector fails to seize these new opportunities, other sectors, such as hospitality, events, or IT, will surely do so.
