The flexible office market in Manchester will increase by about 50 per cent in the next four years, according to specialist research by real estate advisors Colliers International.
The firm’s Flexible Workspace Outlook Report 2019 forecasts that such workspace in Manchester will expand by 20,675 sq metres – or about 50 per cent – from 40,530 sq metres at the end of 2018 to 61,205 sq metres in late 2022.
Consequently, the number of employees occupying flexible office space across the city will rise from 8,106 at the end of 2018 to a total of 9,793 at the end of 2022, based on 80 per cent standard occupancy of such space.
The increasing provision of such space in Manchester is shown by global space, community and services specialist WeWork now operating five locations and Spaces, the Regus brand owned ultimately by IWG plc, already occupying Peter House and due to take the entire 116,000 sq ft at 125 Deansgate currently under construction.
The growth in size of the Manchester flexible office market reflects similar expansion of the sector across 22 European cities covered by the Colliers’ report, with the number of office workers occupying such space rising to 750,000 in 2022.
According to Colliers, the number of flexible workspace operators across Europe has grown 135 per cent over the past four years, with flexible workplace centres increasing by 205 per cent over the same period.
As the desire from occupiers for flexible office space shows no signs of diminishing, Colliers’ research indicates that take-up could double again by 2022 across major European cities, with Berlin, Bucharest, Munich and Prague amongst those expected to see the most growth.
Peter Gallagher, director national offices and head of the Manchester office of Colliers International, said: “The ongoing growth of flexible office space in Manchester is reflective of its expansion across Europe in terms of the number of sites, volume of space and number of operators.
“The shift towards ‘space as a service’, and not just a commodity is probably going to be the biggest driver of growth in demand for flexible workplace going forward.
“However, even at the top end of the spectrum, total take-up remains marginal in comparison to the wider office market, suggesting the sector has not grown or expanded to excess.”
Colliers’ report highlights how traditional landlords are responding to the market shift, where, particularly in London, some are establishing their own flexible workspace presence while an increasing number look to share risk and upside through joint ventures with the more established and successful workspace operators.
Concerns over the ‘excessive growth’ of the flex sector have been well publicised, with occupiers in certain business sectors remaining wary of overexposure to co-working, particularly in light of the prospect of economic cooling and diminishing levels of employment growth.
Damian Harrington, head of EMEA research & forecasting, Colliers International, concluded: “It is clear to see how rapidly the flexible workplace niche has expanded since 2001 in terms of the number of sites, volume of space (sq m) and number of operators in situ across Europe. However, even at the top end of the spectrum, total take-up is marginal in comparison to the wider office market, suggesting the sector has not expanded to excess and there is still room for growth.