Managed offices are presently the hype among office spaces. This article contributes to the office
area decision-making process of any company. To support your decision-making process, we have
backed this article with sufficient statistics, both from the past and the future likely outlook.
We also included the challenges faced by the Indian work culture in the past, and how we transformed our
work culture to rectify the shortcomings.
Overview of Managed Office Spaces
Conventional working spaces were the trends, and for a long long time indeed. Trends however took
a dramatic turn and we are now living in an era of flexible working spaces.
Day jobs are not the only source of livelihood, and freelancing and entrepreneurship are the alternatives people choose.
Traditional working places are rigid, probably not a match for professions like freelancing and such.
Soon after non-conventional working patterns ( not 9-5 jobs) grew into prominence, the concept of
flexible working spaces was officially adopted.
Flexible working spaces such as co-working spaces and managed offices became the chosen work setup. The popularity of such work setups grew because they assist companies with all kinds of working structures.
The flexible working spaces industry quickly adapts to the changing business requirements, be it
business objectives or manpower handling. The current market scenario has compelled companies
to adopt a flexible working model and flexible working spaces do justice for them.
Managed offices belong to the flexible spaces industry and provide flexibility to businesses.
Managed office space is a tailored workplace solution provided by a service provider. Such third-
party service providers offer customized workplaces alongside a bunch of amenities.
Also, they vow to manage the workplace from the time of initiation of the contract till the end of it. The lease
agreements are unlike the conventional ones and hence helps save a major portion of capital.
Managed offices do not require a company to sign a long-term lease commitment, make upfront
payments, or even maintain an in-house infrastructure development team. The flexible working
space industry is challenging to introduce a new era of workplaces and we are witnessing it already.
Flexible Office Spaces Industry
Pandemic hit us all when we least anticipated it. It shrunk the economy, but each of the industries is
trying to cope up with it and bounce back. Remote culture is suitable for these difficult times and so,
companies have adopted it as the new normal.
Since the model distributed workforce is gaining momentum, companies should consider the option of flexible working spaces.
Firstly, the real estate industry’s worth is the same but the earning capacity of the companies
probably went down. Companies are therefore considering flexible office spaces to cope with real
estate leases, costs, and other similar hurdles.
Managed office spaces mitigate risk arising from loss of capital, and thus companies are able to invest more capital in core business operations.
How is the Flexible office space industry doing post Pandemic?
Experts present a bunch of statistics from research to back up the fact that the growth of this industry is inevitable.
- As much as 25% of growth in flexible spaces was recorded in the year 2018, which has been on a rise ever since. The flexible industry has created enough increased awareness of the perks it introduces. The high acceptance rate of the industry would not put the growth rate on hold or even pull it down.
- The industry is witnessing new competition and new entrants are bringing in innovative solutions to get a competitive edge. This is the assurance of growth and constant evolution of the industry, which is touching new heights quite often.
- Offices and businesses are not leasing managed workplaces alone. Medical labs, industrial facilities, housing, and retail also have a lot to benefit from the structure of managed or coworking spaces.
Managed Offices Industry Growth
Flexible workspaces have come a long way, and the growth has been remarkable. A bunch of perks
led to the growth of this industry and we have included a few of them in the following pointers.
Amenities
Managed office services are not limited to leasing a space. The service provider
renders a bunch of post-hire services as well.
This includes facilitating high-profile amenities for
the brand like in-house gyms, board rooms, auditorium, cafeteria, etc including tech-enabled
spaces.
Cost savings
Leasing out spaces now are pocket-friendly just like shopping from a budgeted
store; who knew real estate would become budget-friendly as well.
Employees or employers
who fancy a modern office can avail themselves of the managed office space solution.
Employers
can save heavy upfront payments and other heavy charges of leasing a space if they choose a
managed office solution.
Compatibility
Startups or established companies can easily jump onto the bandwagon of
managed office spaces. Flexibility is the major perk managed offices offer and so, they are the
compatible solution for any kind of business.
The popularity of these working spaces is only
growing and so is the demand. The specialty of tech-enabled offices that managed spaces offer
is the perfect solution for the millennials and others alike.
Flexibility
Flexible spaces were a trend for startups initially and were a foreign concept for
an established brand. Well, the tables have now turned. The culture of the distributed workforce
has redefined the manpower requirement in the office.
Therefore, managed offices are now a
widely accepted term and structure. Also, the terms of the contract grants ownership to the
businesses and they get to design their workspace in any way they want.
Stats suggesting the growth of Flexi offices
The latest statistics describe that there are 35,000 flexible workspaces establishments in the world, which is remarkable growth. If we take a look at the valuation of the industry, it presently amounts to a whopping $26 billion.
Covid has barely held down any growth prospects of the industry, and we can visualize it achieving
heights. Despite the disruptions pandemic caused, the industry bounced back stronger and is
standing tall as a reliable long-term workplace solution.
Managed offices were denoted as the trend but are now the mainstream solution since we are
witnessing a hike in distributed workforce ratio. A distributed workforce is the hybrid work model
and companies that have adopted this model are considering a flexible workplace.
Such flexible workplaces fulfill the need of companies managing remote teams from across the globe.
Statistics
Future prospects of the industry would remain unhampered. The growth rate is increasing at a slow
rate, and the future looks bright. Check out the flexible working industry stats from the recent year,
2020-2021.
- Experts predict that there will be a spike in demand for managed offices by as much as 21% by the end of the year. This figure is derived after carefully considering the aftermath of the Pandemic.
- Presently, the area used to build Flexi spaces is as much as 86 million sq. ft. If we compare this figure from the previous records, there has been 2x growth in 4 years.
- Employees are now open to the concept of coworking, more than ever. Experts have also mentioned that brands already using coworking spaces would stick to it. Also, the strength of 54.9% added to the remote workforce say they would join coworking spaces to fulfil their remote working needs.
- The future of this industry is definitely bright and the aforementioned stats back it up. Pandemic or otherwise, this industry remains unshaken and is projected to grow beyond leaps and bounds. The era of modern offices is here, indeed.
Managed Offices Trends
Global flexible workspaces valuation is expected to touch USD 111.68 billion by 2027, at a CAGR of
around 17.1%.
Rest assured, small, medium, and large-sized businesses, as well as start-ups, are all open to the idea
of flexible workspaces. Vast adaption is the contributing factor to the growth of flexible workspaces,
which presently have around 5 billion customer base already.
Compatibility as per Industry
The BPOs and KPOs sector has the highest acceptance rate of managed offices. Other industries that
have adopted managed offices are IT, Retail, Entertainment, and BFSI. The IT sector prefers this
solution since they need a tech-backed compound and office premises.
Retail and entertainment industries do not work the conventional way and hence they are in dire need of a fancy work environment which endorses collaboration and creativity.
Compatibility as per Cities
Cities from India with a high adaptation rate are the Tier 1 cities. Awareness of this industry is
spreading fast in Tier 2 cities as well and they are expected to jump into the trend. Trends in India
show that the square feet occupied have increased by 60% lately.
Pandemic has brought forwards 2 lessons, the necessity of socializing within office premises and
distributed workforce model. Remote working was a luxury previously and this barely had an impact
on the decision-making process of desirable workspace.
But the pandemic has now changed our work culture, and companies are in talks to infuse distributed workforce or the hybrid model if they already haven’t. This is forcing companies to reevaluate their workspace requirement, and the flexible office is indeed the right and quick solution here.
Managed Offices Adaptation in India
2017 brought forward economic reforms in Indian markets, keeping the door of managed offices
wide open. Such reforms led to the upliftment of many sectors, including the commercial real estate
sector.
2017 was the stepping stone towards progress for flexible workspace and experts predicted
2018 would be positive. Indeed, the prediction turned out to be true.
Managed Offices Industry Outlook
Flexible working spaces have made a notable advancement till the moment, but the adaptation rate
is sleek as compared to the traditional workspaces. We have however included a bunch of factors in
this section, which would drive the future demand.
Flexibility
Desk and chairs were the prior norms, but do not compulsorily belong to the flexible spaces. Brands
now focus on minimizing costs and penetrate sales through teamwork and amplified productivity.
This is why more and more companies are expected to join the community of flexible workspaces
shortly.
Money Value
Studies claim that companies that avail themselves of managed offices save a major chunk of their
expenses. This can indeed be a major game-turner for large and medium-sized businesses.
It is because they will be able to retain more capital from real estate investment which they can
contribute to core business. Benefits of amenities from flexible office service providers are the
cherry on top.
Talent acquisition
A flexible workplace lets companies easily explore remote work models. A company can quickly
switch to a hybrid model of work through flexible workspaces as they are tech-based infrastructures.
Such infrastructures let service providers efficiently manage a remote team. Should there be any
further advancement in technology, the flexible office service providers would provide the same
level of tech assistance.
Future Infrastructure Prediction
Though the future is unpredictable, the present data depicts what the future offices can be.
- Pop-up privacy booths can be a part of managed office spaces in the future in case the present level of socializing gets too much.
- Tech is in its advanced stage and we are building smart cities and offices alike. This might lead to the establishment of data-tracking smart campuses.
- In coworking space, members would be open to communities. Big community gatherings would emerge as members would be interested in fun interactions alongside sharing the office space.
- Pandemic is enough proof for why wellness would be the priority of companies.
- Work from home is the trend and the hype is real. Employees are getting cozy at home, and hence to invite them to the office, companies would want to bring in a comfortable look and feel, partially.
Five years down the lane, the outlook of the Managed Office industry looks promising. The
traditional workplaces are presently dominating the rental office industry but tables are all set to
turn.
The flexible workplace industry is booming with its appealing offers and would soon surpass
the present Traditional (dominant) rental stake.
