Savills News

Europe’s ‘second cities’ expected to be hotspots for future flexible office demand – Savills / Workthere

According to the latest research from Savills and Workthere (workthere.com), smaller capital cities across Europe  such as Dublin, Stockholm, Warsaw and ‘non-capital cities’ in core countries such as Hamburg, Frankfurt and Birmingham are likely to see strong demand for flexible office market.

The European Flexible Office Spotlight reports that, while core European capitals including London and Paris, which have more mature serviced office markets, will see higher demand for flexible office space (FOS), other cities that also have dynamic economies and attract innovation and talent will see demand for flexible offices rise. 

Eri Mitsostergiou, research director at Savills, says: “As part of our research, we have identified the cities where we expect future demand to be strongest based on a set of criteria related to economic growth, job creation, innovation, and property market fundamentals. It is no surprise that London, Paris and Berlin are at the top of the ranking, as they attract 80% of the Venture Capital (VC) investment of the cities we analyse. However, what is interesting is that capitals outside of the three core countries (France, UK and Germany) such as Amsterdam, Brussels, Dublin, Stockholm and Warsaw as well as Germany’s second largest city Hamburg and financial centre Frankfurt all rank in the top ten.”

The research notes that a quarter (24.8%) of office take up in Stockholm and a fifth of office take up in Brussels (22%) and London’s West End (21%) is now flexible office space. This is followed by Paris CBD (14.8%), Warsaw (12.9%), London City (12%) and Dublin (11%).

Eri continues: “Last year flexible office space take-up increased by 20% year on year to reach almost 830,000 sq m across the 20 major European cities that we monitor. This corresponds to 9.9% of the total take-up levels, when only three years ago this share was below 3%. As take-up of flexible offices continues to grow, it’s the smaller, ‘second cities’ where availability is higher and therefore where we can expect to see most growth.”

Cal Lee, global head and founder of Workthere, comments: “Looking forward, we expect the popularity of the flexible offices sector to intensify as the sector diversifies its offer. We believe that cities with dynamic economies, which attract innovation and talent can see demand for flexible offices rise up to 15% of the total in the medium term, while in the long term this could increase to 20-25%, especially in periods of economic growth and business investment.

“Over the next two years we expect to see the highest expansion of flexible offices in smaller but dynamic markets where availability allows and the share of flexible office space take-up is still below 15%, such as Dublin, Madrid, Barcelona, Bucharest and Lisbon.”

Listen to our podcast here: https://www.savills.co.uk/blog/article/278650/podcasts/real-estate-insights-podcast--europe-s-next-hotspots-for-flexible-offices.aspx

Download the report here:

http://pdf.euro.savills.co.uk/european/european-investments/march-19-spotlight-european-flexible-offices.pdf

ENDS

About Workthere

Launched in February 2017, Workthere is a Savills venture introduced to help businesses find flexible, co-working and serviced office space across Europe, America and Asia. Workthere is an entirely new brokerage service and website listing platform - workthere.com - combining tech with an expert human touch. Workthere is a completely free service for occupiers and covers the entire flexible work space market as well as covering more specialist space such as laboratories. The concept was formed by Cal Lee, a former graduate and development surveyor at Savills, who saw the opportunity to offer a new platform for growing co-working and flexible work space providers to market their space. www.workthere.com  

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