Four Hacks Supporting Flex Space and Change in Commercial Real Estate
It’s now a fact, not simply speculation, that Space as a Service is driving significant change in the steady world of commercial real estate.
My colleagues and I spend much of our time helping clients and commercial real estate teams understand how to navigate through change with flexible spaces. Below are four hacks typically of interest to our clients. Of course, the hacks include utilizing Furniture as a Service (FaaS).
The FaaS hack involves accessing vs. owning furniture through a subscription-like approach. This allows buildings and the people who work and manage them to use furniture as a flexible tool rather than a stagnant asset.
Lobbies and Amenities
Remember the days when extravagant lobbies were dressed to impress? Well, they are changing. These prized first floor spaces are ideal to create the amenity areas that buildings must now have. As mobility continues to drive how and where we work, touching down while on the go is critical. The quiet lobbies of yesterday have exchanged their opulence for busy, trendy and ever-changing touchdown spaces and communal gathering areas. The FaaS hack here is that lobbies can be filled with furniture that changes with the season, can be switched out as desired to create a sense of newness and life.
Flex-Spaces
In this Propmodo Flex-Space article, Ron Steinbrink defines flex space as “providing companies with access to flexible but dependable office space on a lease term of anywhere from one month to three years”. The very nature of a flexible space calls for flexible assets and that’s where FaaS comes in.
There is a trend to create flexibility in buildings that provides an option beyond coworking and specifically for mid-sized and growing firms. In some instances, building ownership and landlord teams are banking on the ol’ Field of Dreams perspective, “if you build it and they will come”. As the Flex Space article mentions, Boston Properties tested this theory and were thrilled to lease all the spaces within 30 days and realized the building valuation increased and not the other way around. Great Read summarizing their journey.
A trend I’m participating in lately aligns with older buildings that really need to have a hook to help with leasing activity. Across the US we are working with clients to install short-term flex-spaces in a portion of these buildings. The short-term space demands a much higher square footage cost. A sign of the times.
Spec Suites & Plug & Play
The FaaS hack for Spec Suites and Plug & Place is the ability it provides commercial real estate teams to provide a low cost, minimal risk and flexible approach to furnishing space. Now a solution exists to outfit a vacant space, with trendy furniture, for a fraction of the cost of purchase. And then, change it, move it, return it based on the needs of the new tenant.
A recent article in Rejournal is entitled How spec suites have become the most powerful component in the office marketing toolbox and it sheds light on the popularity of creating suites that make it easy for prospective tenants to say yes because they can visualize the space in a more finished form.
Quote from the article, “The spaces that have the higher designs of spec suites, where the building owners are clearly investing money, those are the ones that stand out to the tenants,” Brown said. “It sets the tone that the building is willing to take that risk, to spend money on design and furniture.”
CORT helps CRE teams with renderings, pricing and millions and millions of dollars of inventory to choose from. Def a hack!
Swing Space
There will always be the need for swing spaces because buildings are always changing to meet the demands of the tenant. Although some firms are utilizing coworking spaces for the traditional swing space, there is still a great need for larger firms needing their own space during transition times. With FaaS, companies are able to set up the office and then add to it as needed. Because FaaS is fast, a 200 person site can be up and running within about ten days. And gone just as fast.
All four of the examples here really do fall into the broader category of Space as a Service. Simply put, demand will drive the need for fast, flexible and well thought out space so businesses can focus more on what they do. When we queue up Spotify, we don’t need to understand what is behind the curtain, we just want to hear a song. No difference here.
Melanie Jones is a regional industry leader on the CORT Workplace team. Her mission is supporting change in the way furniture is used in the workplace with CORT’s Furniture as a Service (#FaaS) subscription-like model. @melanie_cort #faas #subscriptioneconomy #flexspace #access #usership #sharingeconomy #innovation #assetlight #change
