Flex To Impress
Whether it is bringing in a specialist flex operator or doing it yourself, adopting flexibility when it comes to leases is the only way to go in the post-Covid world for many in the market.
“The easiest way for owners to get it wrong is to do nothing and think the world is going to go back to the way it was before,” The Crown Estate Workplace Customer Partnership Director Alex Kim said.
Kim said some of The Crown Estate’s tenants contracted their space needs during the pandemic, while some expanded. The company is now working toward a model that makes leases flexible, with the ability to ramp up or down at short notice, for its small and midsized tenants.
“Just relying on location isn’t going to cut it any more. Flexibility should be a default and to do things any other way is a risk, we feel,” he said.
Of course, for a company that is almost 1,000 years old and doesn’t need debt, this is a viable strategy. Until the real estate lending world gets comfortable with flexibility, owners giving their clients the ability to break leases at short notice will be seen as less secure income than long leases. The flip side, as Kim points out, is that not offering flexibility could be the riskier strategy going forward.
So, you have decided to go down the flexible route when it comes to finding new tenants for the vacant space in your building. But how are they, as well as your existing tenant, going to deploy the hybrid work model in practice? The answer has big implications for real estate owners. Read on …
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