Flex Office – modern solutions on office space market

The new, pandemic reality has presented different needs for entrepreneurs and their employees. The office space market has faced huge challenges. Flex office – a modern form of lease – is gaining strength and becoming a trend in offices of the new normality and reality. What distinguishes the Flex Office from other forms of lease? Why is it worth using flexible office space? What will the future of modern workplaces look like? Piotr Augustyn answers these and other questions ininterview for FOCUS ON Business.

FOCUS ON Business: Where did the idea for creation of your brand come from?

Piotr Augustyn, chillispaces.com: The history of the company Rise.pl goes back to 2003. That time I was responsible for management of investments in Poland. Mainly industrial and real estate investments. Subsequent customers, implementing their projects, needed a place where they could register their companies. We decided to give them such a service, which got its name from the USA and was called 'virtual office'. Then we expanded our offer by renting the office space. That is how 'Hot Desk', now called coworking, was created. After a few years, responding to our customers' needs, we started providing the serviced offices. The separated spaces were a formal requirement of our customers – we had to take into account the needs of their business partners. Each new customer is a good lesson in best practices for us. For our first big office, we threw ourselves in at the deep end because the requirements of our customers were huge. In business you have to be brave and courageous. Because it pays off! Thanks to this we know that we are able to serve both large and small customers.

Where can we look for the roots of coworking?

The service originated in the United States, where freelancers decided to rent and share the office space together. The idea of 'cost sharing' was attractive to them. They participated in the cost of rent and initially created coworking only for themselves. Later the service was extended and became available to other entrepreneurs. Requirements and needs in relation to the office space have evolved over the years. This is where the Flex Spaces are building their competitive advantages. The flexible serviced offices, by their nature, are designed as rapidly reconfigurable spaces. If we assume that in the new normality and reality the office will act as a meeting point for teams, creative work, and event spaces, rather than acres of

The Flex Office market has been developing dynamically for many years. Poland is following thetrends from theUSA and EU.

What is the new way of office space renting?

The Flex Office market has been developing dynamically for many years. Poland is following the trends from the USA and EU. The pandemic and its consequences for the organization of work has opened up a new dimension to flexible office space services. First of all, companies, which often suddenly switched to remote working, had to deal both with the excess of rented space and with great uncertainty how teams will react to returning to the office after a long time. While the issues of excess space could be relatively smoothly solved by subleasing or moving to a flexible space, the second issue is much more complex. In fact, we are still in the comeback phase and are exploring what the offices of the future should look like. desks, then the Flex Office is able to provide that space to its users. The fact that the space is managed by a flex operator takes the burden of space arrangement and associated design costs off the customer’s shoulders.

What distinguishes the flex office from other forms of lease?

It is worth understanding that a serviced office should be perceived not as a typical lease, but an office as a service. In this case not only the size of the office is important but all the elements which we call "service part of the service". It includes the speed of service delivery to a customer, its quality, stability, security and flexibility, which is understood differently today. It is not only short rental periods, but first of all the approach to the relationship with a customer.

The fact that we are closer to a customer allows us to respond faster to changes such as pandemic disease. For example: Currently, teams can't determine how much of their work will be made in their offices or in a form of hybrid work. Inthe Flex they will find a solution for themselves.

For us as an operator, the sale of the service does not end at the moment of conclusion of the lease agreement. In fact, the actual selling starts right now, because we are not protected by long lease periods and termination notices. It is important to create a good relationship with our customers, not only to make the lease last as long as possible, but precisely to know their needs. As a serviced office provider we are able to meet these needs much faster than a traditional landlord, if a landlord is able to do it at all. Such things as space changes, reconfigurations, flexible approach to valuation of the service and adapting it to the customer’s development needs, e.g. by using the "pay-as-you-grow" model, are elements that a traditional lease will not provide as efficiently and effectively as the Flex model. The fact that we are closer to a cus tomer allows us to respond faster to changes such as pandemic disease. For example: Currently, teams can't determine how much of their work will be made in their offices or in a form of hybrid work. In the Flex they will find a solution for themselves. Serviced offices combined with club cards for employees in hybrid mode remove this uncertainty and reduce costs. I mentioned earlier. No long commitments and the speed with which the office can be available. Secondly, the cost stability and scalability of the service. This is often a key element for any developing companies or new entrants. Pandemic has also shown that employees are more and more willing to work closer to home.

Recent years have shown that the idea of the "share economy" is visible inmore and more areas of our lives. We share cars, holidays homes and many more. How about sharing the office space as well?

Another important factor is the simplicity of the cooperation model. The customer pays a simple fee for a workspace that includes all necessary elements.

Why use the flexible office space?

There are several reasons for this. First and foremost is the flexibility Serviced office networks with locations

beyond downtown can provide their customers who have distributed teams with the office space in a variety of locations.

Recent years have shown that the idea of the "share economy" is visible in more and more areas of our lives. We share cars, holidays homes and many

more. How about sharing the office space as well? The serviced office is an area dedicated to a given customer, but auxiliary facilities such as conference rooms, reception areas, chillout spaces are shared by all customers, which helps to reduce costs.

Who is the Flex offer aimed at? What should a tenant consider when choosing a flex office offer?

First of all, a tenant should take into consideration the completeness and versatility of the service, i.e. the price should include all necessary charges. Secondly, the quality and stability of the infrastructure which must guarantee and provide has shown itself as a pandemic effect, i.e. the expectation on the part of traditional tenants for a flex operator to be in the building where they rent an office. In this case, the flex offering complements an offer of the building owner and becomes the same essential element as food service, showers, conference rooms and many more.

What will the future of modern workplaces look like?

That's a very good question. I would like to know the answer to it myself (smile). I think we all realize that the role of the office will change. Over the coming months and upon the permanent return of teams to their offices we will see how

dramatic and spectacular this change will be. What we see today is very high occupancy in our offices, despite pandemic disease – some of our offices are 100% leased. The Flex space is no longer just a temporary solution, but a target location for companies that have previously based on traditional leases. The possibilities offered by the Flex for hybrid teams have a positive impact on the perception of this service. The share of the Flex space in the total market has been growing, and please remember

The market is changing dynamically and rapidly. The coworking and serviced offices, two different services, are no longer dedicated mainly to freelancers and small companies. Even before the pandemic, we estimated that large corporations and medium-sized companies generated about 40% of the turnover in our industry. The pandemic has only intensified this trend. The Flex is still an offer for small businesses and freelancers who will find here a professionally prepared office and, importantly, also a community and contacts. However, a corporate customer places emphasis on other elements, such as the high-quality IT infrastructure, redundancy, stability of the service as well as security and safe of the space, not only physical, but also health and medical. Additionally, a customer is interested in the image of its company and its office, i.e. the possibility of customizing of any flexible spaces in accordance with the customer’s requirements, so that its employees feel part of the organization.

The Flex is still an offer for small businesses and freelancers who will find here a professionally prepared office and, importantly, also a community and contacts.

the failure-free continuation of any business processes. In my opinion, it is important for the location to provide opportunities for development and reconfiguration of a given space. The rest depends largely on actions of an operator and its flexibility. Flexibility, however, is in a way a state of mind.

Is the Polish office market prepared for modern forms of lease?

These forms are already here. The market certainly is ready for them and is developing rapidly. Operators in our country are also beginning to offer new types of services, developed for example in the U.S. by the Corporate Serviced Suite, which are dedicated to corporations. There is also a phenomenon that that the level of this share in Poland is much lower than in Europe. The question “what kind of office it should be”

is not as important as the question “where this office should be”. In the U.S., there is a strong trend to open the flex space away from city centers so that an employee does not have to commute to the office. This office "comes" to an employee by creating a network of satellite offices. Work-life balance certainly benefits from this. In our strategy we have assumed the creation of flex

centers in smaller cities/towns which also have their potential, and which are not the first choice for investors entering Warsaw or Cracow.