Dan Zakai is the Co-Founder and CEO of Mindspace, a global provider of boutique flexible spaces in 16 cities across Europe and the U.S.
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Soon, offices everywhere will be balancing a “total ecosystem” of workspace — one that combines traditional office space with work-from-home and third-party solutions. Companies across the globe are facing one of the most perplexing, challenging and complicated questions in decades: How do we resume work in the office after months of disrupted telecommuting due to the pandemic?
Some companies will choose to dive right back in, holding their breath and hoping the waters beneath them are deep enough. Others, including a handful of the globe’s most influential tech companies, have announced that remote work will become a permanent option for their employees, a decision that has upended the idea of the global office and will have long-term ramifications on how employers design and execute workspaces and schedules moving forward.
I don’t believe an extreme all-or-nothing approach is the answer. Modern workers have evolved and changed, and so have their needs. Even before the onset of the pandemic, hybrid work schedules and flexibility in on-call hours were becoming more prevalent. And technology that enabled connectivity and availability, with or without the worker being physically present in the office, had transformed the once-rigid concept of working hours and free time. Today, our schedules are hybrid and flexible, and our workspaces are increasingly so as well.
For most companies, the answer is somewhere in between. I believe that office work will be resumed because the office is so much more than four walls and a physical space — it’s a point of connection and community that is vital to an employee’s well-being.
These are days of immense uncertainty. Facing that uncertainty requires flexibility and cost-effectiveness, especially in the short-term. And one of the easiest ways to limit damage and increase agility is to grow your business by sharing space — i.e., the conference room is shared with other companies and included in your monthly tenancy fee, for example, rather than your company solely paying for it 24/7, only for it to be left empty most of the time. The same goes for your kitchen, lounge and restrooms. We have even found that these kinds of workspaces could save companies up to 60% in costs. Savvy business leaders can then in turn reinvest those savings into building and growing the business. In a time when so many companies are contracting, that’s significant.
Of course, every company is different, and every cost portfolio is unique. Real estate is a capital expenditure. After a number of years — for most companies, the sweet spot is around year four or five — the costs of a traditional workspace begin to dip compared to that of a flexible space. So while we’re thinking in terms of short-term, post-pandemic response, it’s also helpful to have a long-term outlook in mind as well.
But in this moment, as we shift from an extreme lockdown to an unpredictable future, corporate employers need to weigh all the options available to them before locking into an office space as they shift from working from home. Businesses considering whether or not to make the leap to flexible spaces may feel overwhelmed by the decision. Here’s what you need to think about to easily understand if the move to flex space is best for you.
• Your lease agreement: Are you able to easily break your current lease, or are you currently on the hunt for new real estate space? In that case, flex space could work well for you. Rather than sign on the dotted line for a huge office building that you’re now bound to for at least another year, wasting massive amounts in overhead and seeing precious floor space squandered while you operate well under capacity, you may be able to start working in a flex space and then slowly scale up.
• Your long-term plans: Do you plan to stay put over the next five or 10 years? If that’s the case, flex space probably won’t work for you, and you’d be better off putting down roots where you are. But if you prefer not to commit to five years of rental payments for a fixed space office, or feel you can’t adequately predict the size of your company over that same time period, a flex space with a cleaner exit possibility and/or room to grow might be just the ticket.
• Cash flow: Office space requires more than just a lease agreement. You’re also going to need cash on hand for aesthetics, good quality furniture, supplies and cleaning — a major priority in today’s world. Consider your cash flow and the key priorities of your shareholders before locking yourself into a relationship with a landlord that might come with unforeseen costs that you can’t shoulder and which a flex space might help alleviate.
In a time of pandemic and downturn, the right business decisions are worth more than ever before. No matter what your company’s size, what city you’re based in or what your business model is, understanding all of your options will guide you as you move forward in this uncertain age.
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