The Future is Flexible: Why Flex Real Estate Is Gaining Ground
The nature of work is changing. The nature of cities is changing. And the push for sustainable practices continues to change the way people do business. In light of these developments, many believe that it's time for real estate to change as well.
What will the future of real estate look like? Without a crystal ball, it's difficult to know for sure, but many industry speculators keep circling back to one word: flexibility.What is flexible real estate? Why are developers, investors and tenants excited by the concept? Andhow might flexible real estate positively impact the future? Let's look at why flex real estate is gaining
ground.
What Is Flexible Real Estate?
As such a new term, there's no hardline consensus on the definition of "flex real estate." To some, flexible real estate refers to a hybrid approach to development that incorporates several industries and uses under one roof. You might see retail businesses coexisting with corporate offices, manufacturing centres and even residential apartments.
To others, flex real estate involves re-imagining existing properties as flexible enough for multiple applications. For instance, a flex property in the REEF network might use a parking lot to host modular applications like dark stores, e-commerce fulfillment centres, delivery kitchens and micro-healthcare clinics.
Finally, flexibility in real estate may refer to the working environment itself – a customizable, reconfigurable, and, ultimately, people-focused way of thinking about workspaces.
The Benefits of Flex Properties
People are excited about flexible real estate – for good reason. Done well, the concept benefits owners, tenants and workers.
Real estate owners and investors benefit from flexible properties in a couple of ways. Chiefly, flex spaces are more "COVID-resistant"; they are reconfigurable and customizable enough to attract diverse businesses and co-working tenants, ensuring continual occupancy. Essentially, your flexibility is a hedge against vacancies.
Flexibility also benefits employers. As Deloitte points out, renting a flex space allows businesses to rent less space on a fixed term, increasing the efficiency of a lettable area and lowering square-meter-per-employee required.
Finally, flex properties benefit workers in several ways. They are more customizable, allowing co-workers to create an ideal space for themselves. In mixed-use properties that host services like restaurants and clinics, workers enjoy greater proximity/accessibility to amenities. And flex spaces allow people to feel more interconnected – with their co-workers and their community.
The Overarching Advantages of Flex Real Estate
Beyond the impact on immediate beneficiaries, flexible real estate can have an overarching impact on sustainability, community empowerment and neighbourhood walkability. Because flex properties aim to densify and diversify the number of businesses in a given area,
community members see a more walkable neighbourhood.
As an example, take the REEF model (mentioned above), where modular applications like restaurants and healthcare clinics occupy otherwise-empty parking lots. Neighbourhood residents enjoy walkable amenities, which can improve quality of life and make cities less car-dependent.
That's just one example of how sustainability, community empowerment and walkability are interconnected with flex real estate. Also, repurposing spaces as multi-use properties is more sustainable than developing new, single-use commercial properties.
With any luck, the future of real estate will be flexible. In re-imagining real estate properties as multi-use, customizable, reconfigurable spaces, everybody wins. Owners can see lower vacancy rates, employers can expect higher productivity rates, workers can feel more interconnected, and community members can enjoy a more walkable, sustainable neighbourhood.
