For small to medium business, the age of the long lease is dead.
Tim recently met with George Scott-Welsh, CEO of The IncuHive Space to chat through the latest trends in commercial office space for SMEs. George highlighted a seismic change in the industry: the inflexible, long lease (with a distinct lack of customer service) is being replaced by a flexible, short lease model with a highly responsive style of customer service.
Tim Scrace and George Scott-Welsh discuss changes in the workspace
Covid catalyst
Embedded business culture is notoriously difficult to change quickly. Despite common use of light-weight laptops and the availability of company secure, virtual private networks (VPNs) businesses still had something of a ‘clock-in, clock-out’ mentality before the Covid pandemic hit. Post Covid things are radically different.
You’ve set your laptop out on your garden table, you’ve enjoyed a suffusion of vitamin D enriched sun rays as you tap away on the keyboard, you’ve picked up your child from school and walked the dog and had a quick chat with your neighbour on the way… and crucially – you’ve also met all your work deadlines and ticked off your priority list for the day. You want more, and less commuting!
This is the quality-time, personal scenario – previously an aching dream of many commuting business owners and employees, that was enabled and expedited by the necessities of the Covid pandemic lockdown.
Restrictive and long lease structures
George and Frankie get ready to talk office space
Lockdown exposed the rigid structure of commercial leases. Business owners were on the edge and looking for fast solutions. Combing through the tangle of conditions in a lease, there seemed to be no flexibility – only restrictions such as a ‘fixed break’ option only available after a number of complete years; service of notice set at 6 months; exit only when all outstanding rent was paid up, to name a few examples. A long lease (minimum 5 years) that you could not exit easily was the norm across the industry pre-covid.
George Scott-Welsh:
“One of my acquaintances… he was talking about cutting his teeth selling office space in London in the ‘80s and he’d sell a 100 square foot office, like the one we’re in now, on a 25 year lease… and that was the only option.”
Zoom Forward: Home, Hybrid and Office
“Fast forward 43 years and we are in a market where the tenants are no longer accepting long leases, because they don’t need to, because the flex-letting market has become more popular and stronger.”
There are now 3 commonly accepted styles of work: at home, at the office and a hybrid version of the two. Working in the office offers relief from the solitary confinement of a home work station, opportunity to chat informally with colleagues and peers ‘at the water cooler’ and the most human form of communication: face-to-face. Hybrid is, of course, the best of both worlds.
Looking to a flexible future
Office rental companies now compete by offering flexible and customer-centric solutions with short terms leases. This allows people to enjoy all three styles of working when they choose. It also allows companies to respond fast to growth or downsizing.
At Scrace Architects we consult regularly with business leaders, entrepreneurs and our peers to keep a finger on the pulse and ‘see space differently’. Visit Flexible Office Space to find out more about how we are adapting spaces to accommodate a hybrid model and visit some of our residential projects to see some examples of how we are helping our clients work from home.
Working flexibly: Scrace Architects
We are ready to solve the architectural problems around your flexible space. Contact us today to discuss your space with potential. To arrange an appointment today, call us on: 01722 658048, email us on info@scracearchitects.co.uk or use the ‘contact us’ button.
