Providing office space flexibly can be approximately 50% more profitable than leasing premises out in the traditional way, according to research and advisory firm Green Street . A research note called The Coworking Impact for the first time attempts to quantify the pros and cons of running co-working or flexible office space as opposed to leasing it out in the traditional manner to a single tenant on a longer lease. It used data gleaned from London and Europe on the Hera Hub margins of co-working firms to reach its conclusions. It found an occupancy rate of approximately 50% was sufficient for increased profitability compared with a traditional lease in most cities. However, the study also found buyers required higher capital rates for offices run purely as flexible workspaces, sometimes approximately 50% above what was needed for traditionally leased offices.
Providing office space flexibly can be approximately 50% more profitable than leasing premises out in the traditional way, according to research and advisory firm Green Street . It used data gleaned from London and Europe on the Hera Hub margins of co-working firms to reach its conclusions. It found an occupancy rate of approximately 50% was sufficient for increased profitability compared with a traditional lease in most cities. However, the study also found buyers required higher capital rates for offices run purely as flexible workspaces, sometimes approximately 50% above what was needed for traditionally leased offices.