There is no doubt the future of work is flexible. Global workspace provider Regus has forecast over 12% of Australia’s commercial office stock will be flexible workspace by 2030, CBRE data shows 86% of 77 major global companies anticipate using flex space from now on while a recent survey by Regus’ global parent company, IWG found at least half of Gen Z between the ages of 18 and 24 years would choose hybrid work over extra pay or more annual leave.
The shift has given rise to the term ‘space as a service’ (Spaas). One white paper sums Spaas up as “a paradigm shift in the way in which the commercial real estate industry has provided products and services to tenants and has changed the role of commercial landlords from rent collectors to service providers.”
Existing coworking operators would like to see themselves as leaders in the change to Space as a Service. Jim Groves, founder of Australian flex office space Rubberdesk website , defines Spaas as a model “offering shorter leases with a focus on a more on-demand experience” Flex office in comparison is “a capsule term that captures everything from serviced offices to coworking rooms to meeting rooms”.
“I’m not convinced that anything in the commercial office space is black and white anymore,” Mr Groves said. “I think there’s all sorts of shades of grey. Often tenants aren’t necessarily aware of all the options available to them - that they can buy, lease, sublease or lease a fully fitted space, or that they can move into a coworking space or take a private office within a coworking space.
“Within all of those areas there are aspects of space as a service, and probably more so with coworking and serviced offices with concierge staff that help with day-to-day office needs.”
The coworking business model works especially well in cases where, for instance, an organization requiring event space occasionally rents a venue instead of retaining a facility “that potentially sits idle 90% of the time”.
“Or an organization can rent an office for 10, and if more people join the team there is spill-over space available in the coworking area that they can also rent.”
Room to grow
The Rubberdesk website which came about in 2016 maintains a feed of current availability and pricing for all kinds of workspaces across the country. It also powers the ability to find offices for customers. “Commercial agents will also often use us to help them find flex space, as their primary focus is usually on leasing and subleasing. The Rubberdesk platform is pure flex space.”
In regard to trends, Mr Groves said there were “more and more tenants looking for flexibility of terms, shorter terms than they may face in a lease”.
“This is especially the case where a tenant is facing uncertainty or, on the flipside, wanting the ability to grow and therefore wanting to know they have the space available to do so”.
The past three months had seen premium office spaces filling up fast, he said. As for existing office blocks, the more successful and popular were “almost creating a third space for this area and some are offering some are offering fully fitted suites”.
“There’s a fair bit going on,” Mr Groves said. “The opportunity is where businesses are trying to attract staff back into the office to give them a reason to commute in and reward them with somewhere fabulous to work.”
However, the coworking business model has also faced challenges in recent times. A number of landlords have locked-out coworking operators from their spaces for failing to pay rent
Another business hoping to ride the Spaas wave is CreativeCubes.Co. CEO Tobi Skovron founded the company in 2017 “literally on my kitchen table”. CreativeCubes.Co now offers seven buildings across Melbourne accommodating around 1300 companies, each with workforces ranging from three to 10 people.
“Around 4000 to 5000 people are using our buildings every day,” Mr Skovron said. “The pandemic accelerated our growth – the storm that came to kill us was actually the storm that made us.”
CreativeCubes.Co’s point of difference was delivering culture along with tailored and engaging spaces.
“CreativeCubes.Co sets itself apart in the space as a service area because we not only provide space but happiness at work,” Mr Skovron said. “We are not here just to be four walls and an office. We run a lot of programs through the weeks and months to deliver culture, energy, thought leadership. It’s part of our service along with the space.
“CreativeCubes is agnostic to industry. We’re trying to build positivity and happiness at work with surrounding yourself with the right calibre of people rather than industry specific people.”
Office desk vs kitchen table
As what is seen as the start of broader acceptance of Space as a Service, companies are similarly subscribing to as well as simply using the service of curated office space. “A lot of companies come to us because they need a meeting room for a couple of hours or a couple of days,” Mr Skovron said. “So what they’re doing is they may not necessarily be subscribing to the space as a service but they’re using the space.
“Then you have the other type of user who wants to put a 10 to 50 person crew together and sign up for 12 months, then that ends up becoming a membership subscription and we deliver curated space.
“The pandemic has proven that people can work from home - but you can’t meet your client at your kitchen table so people are leaning into hiring meeting and event spaces.”