Generating key takeaways...
Despite demonstrated stability and rising demand, the flexible office sector continues to be undervalued by property appraisers, limiting its growth potential. Industry initiatives aim to improve data transparency and attract investment, signalling a promising future for flexible workspaces.
The flex office sector, once considered a niche or novel aspect within commercial real estate, is increasingly recognised as a resilient and secure income stream, though it still faces undervaluation by property appraisers and lenders. Despite the growing evidence of stable financial performance from well-managed flexible workspaces, valuers have yet to fully attribute the high income potential these facilities offer. This discrepancy is impacting growth decisions within the sector.
British Land’s flex office offering, Storey, exemplifies this trend. Located in 100 Liverpool Street in the City, Storey’s occupancy consistently sits above 95% with average lease terms lasting four years, a strong indicator of steady and reliable income. Becky Gardiner, British Land’s head of Storey and managed workspaces, spoke at Bisnow’s UK Office Conference Series emphasising confusion over why this secure revenue stream does not attract the valuation benefit it deserves. “All of that points to this being a really secure income stream,” she said.
The flex office market, despite being over two decades old, still suffers from a lack of transparent data, a problem operators are actively working to overcome. The Workplace Intelligence Network, a coalition of flex space operators including GPE and British Land, aims to create a shared anonymised dataset. This initiative will track occupancy rates, achieved rental rates, churn levels, and other performance indicators to better inform valuers, investors and partners. Gardiner noted that the purpose is to provide “more information” for valuation discussions to reflect the sector’s true value.
Commercial property stakeholders highlight how undervaluation potentially hinders the expansion of flexible workspace solutions within developments. Raj Rajput, managing director of asset management for Hines UK and Ireland, explained there is often internal debate around how much flex space to include due to a “tipping point” at around 20%, beyond which adding more flex space might negatively impact overall building valuation. Thus, despite tenant demand, landlords must weigh its current discounted valuation in their planning.
The demand for flex space goes beyond traditional coworking; larger occupiers increasingly see it as a way to consolidate occupational costs. WeWork’s regional president Luke Armstrong presented new leasing models involving co-terminus agreements where WeWork operates space on behalf of landlords and tenants. He suggested that this approach could attract fresh capital investment, describing the emerging “rolled-up capital” opportunity as promising for service providers, landlords, and investors alike.
External industry data supports these qualitative insights. Surveys by WeWork reinforce the notion that companies view physical offices as critical to business profitability and culture, with 86% of U.S. and UK business leaders predicting increased office importance over five years. Occupancy and productivity benefits of hybrid and fully in-person workplaces are noted as key drivers of this shift.
Further market reports illustrate a stable and mature flex space sector. Industry data from 2025 shows desk occupancy rates stabilised at over 72%, with a significant segment of users opting for longer-term commitments and private offices, particularly in Europe and the UK. Revenue occupancy globally rests near 75%, with the EMEA region leading at 85%, and operators focusing on optimising utilisation through dynamic pricing and tiered memberships.
Financial analyses of major operators like WeWork reveal ongoing improvements in occupancy and operational focus, with projections indicating the potential for profitability as market conditions stabilise. Although the industry is evolving, WeWork’s repositioning after Chapter 11 bankruptcy and the broader coworking industry’s expansion—with thousands of new spaces opening in the U.S. alone—signal robust demand and confidence in flexible work environments.
In summary, while the flex office sector is no longer a novelty and demonstrates resilient income, the valuation practices have yet to catch up, potentially limiting growth. Industry leaders and operators are taking active steps to generate the data needed for transparent valuation and attract investment. This movement, combined with shifting occupier preferences and evolving lease models, points to a promising future where flex space is an integral and well-valued part of the office market landscape.
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Source: Noah Wire Services
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
8
Notes:
The narrative presents recent developments in the flexible office sector, including British Land’s Storey achieving over 95% occupancy and the formation of the Workplace Intelligence Network. The earliest known publication date of similar content is from 2024, indicating that the information is current. The report appears to be based on a press release, which typically warrants a high freshness score. However, the inclusion of updated data alongside older material suggests that while the update may justify a higher freshness score, it should still be flagged.
Quotes check
Score:
7
Notes:
The report includes direct quotes from Becky Gardiner, head of Storey and managed workspaces at British Land, and Raj Rajput, managing director of asset management for Hines UK and Ireland. A search for the earliest known usage of these quotes indicates that they have not been used elsewhere, suggesting that the content is potentially original or exclusive. However, without access to the original press release, it’s challenging to confirm the originality of the quotes.
Source reliability
Score:
6
Notes:
The narrative originates from Bisnow, a commercial real estate news outlet. While Bisnow is known for its industry coverage, it is not as widely recognised as some other reputable organisations. The report mentions British Land and Hines UK and Ireland, both of which are verifiable entities with public records and legitimate websites. However, the Workplace Intelligence Network is not widely known, and its credibility cannot be easily verified.
Plausability check
Score:
7
Notes:
The claims regarding the undervaluation of flexible office spaces by property appraisers and lenders are plausible and align with industry discussions. The report references a survey by The Instant Group and Urban Land Institute, indicating that nearly two-thirds of office landlords expect a decrease in their buildings’ capital values with the current valuation model. However, the report lacks supporting detail from other reputable outlets, which raises some concerns. The language and tone are consistent with industry reporting, and there are no excessive or off-topic details.
Overall assessment
Verdict (FAIL, OPEN, PASS): OPEN
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The narrative presents current developments in the flexible office sector, including British Land’s Storey achieving over 95% occupancy and the formation of the Workplace Intelligence Network. The information appears to be based on a press release, which typically warrants a high freshness score. The quotes from Becky Gardiner and Raj Rajput are potentially original or exclusive, but without access to the original press release, their originality cannot be confirmed. The source, Bisnow, is a commercial real estate news outlet, and the entities mentioned are verifiable. However, the report lacks supporting detail from other reputable outlets, and the credibility of the Workplace Intelligence Network cannot be easily verified. Given these factors, the overall assessment is ‘OPEN’ with a medium confidence level.
