Shift to flexible work gives boost to London landlord Workspace

DEMAND for flexible office space in London is back to pre-pandemic levels as employees return to the workplace and companies adapt their real estate strategies for an era of hybrid working.

Workspace Group Plc, a London office landlord that offers flexible leases, reported occupancy of almost 90% at the end of March, an increase of 7.8% from a year earlier. That’s roughly in line with the company’s occupancy for the same period in 2019, before the pandemic struck.

“Our focus over the past year has been to support our customers’ return to the office, rebuild like-for-like occupancy back to 90% and drive trading profit growth,” Chief Executive Officer Graham Clemett said in a statement on Wednesday. “Customers want their office space to be as flexible as their working habits.”

The coronavirus pandemic has accelerated a shift toward flexible leases as companies adjust their office footprints to take account of evolving working patterns. While London has seen a steady recovery in the number of people returning to the office, building occupancy remains down on pre-pandemic levels as more employees work from home at least part of the week. 

The demand for more flexible space lifted Workspace rental income by 6.4%, contributing to a return to profitability. The company reported a pre-tax profit of £124 million ($156 million) for the year through to the end of March, up from a £235.7 million loss a year earlier. — Bloomberg