Stay vs go
It’s no surprise that the pressure of rising costs leads to greater scrutiny of investments, including when it comes to making decisions about property. But as office space fulfils different organisational needs, businesses are using environmental and social factors alongside more traditional financial and logistical measures to inform their stay vs go decision-making. How is this working in practice?
More businesses are choosing to reconfigure existing space rather than move
What changes, if any, are you planning to make to your office space requirements in the next 12-18months? (Select all that apply)
Despite the economic uncertainty, our survey revealed a positive outlook for office property. Over 45% of the businesses surveyed said they are looking to expand their office space in the next 12-18 months, a figure perhaps caused by the need to accommodate more hybrid working practices and an increasing number of employees coming back to the office. 64%1 of office occupiers admitted they downsized too much during Covid and now need more space.
But while the vote to increase space is high, those choosing to look for new premises is not. Over 49% said they would manage future demands by re-configuring existing space as opposed to 23% who would relocate.
This cautious approach to making moves may be because of the lack of suitable space in the current market, or because they don’t want the expense of relocating staff, new fit outs and dilapidations on their bottom line.
1 Combining answer options “Strongly agree” and “Somewhat agree”.
Despite the economic uncertainty, our survey revealed a positive outlook for office property. Over 45% of the businesses surveyed said they are looking to expand their office space in the next 12-18 months, a figure perhaps caused by the need to accommodate more hybrid working practices and an increasing number of employees coming back to the office. 64%1 of office occupiers admitted they downsized too much during Covid and now need more space.
But while the vote to increase space is high, those choosing to look for new premises is not. Over 49% said they would manage future demands by re-configuring existing space as opposed to 23% who would relocate.
This cautious approach to making moves may be because of the lack of suitable space in the current market, or because they don’t want the expense of relocating staff, new fit outs and dilapidations on their bottom line.
1 Combining answer options “Strongly agree” and “Somewhat agree”.
In the ‘stay vs go’ debate, businesses are choosing the less expensive option of refreshing existing space for a 2 or 3-year window, despite the disruption this might cause.
Businesses’ brake on big relocations and their subsequent costs may also explain the greater interest in using flex space, perhaps as a halfway house, enabling them to increase their space in the short term whilst deciding what they want to do in the longer term. 44% of businesses surveyed said they would incorporate some form of flex space into their portfolio going forward; a positive vote for flex. This was particularly high in the IT/Telecoms and Finance sectors where 49% and 48% respectively said they would incorporate flex going forward.
