Asia-Pacific is world leader in growth of flexible spaces: JLL

Demand for flexible offices — including coworking spaces and serviced offices — is growing faster in Asia-Pacific than anywhere else in the world, according to new research by real estate consultant JLL. The region’s stock of flexible floor space is increasing 35.7% a year compared with 25.7% in the US and 21.6% in Europe.
Across Asia-Pacific, the number of major flexible space operators has doubled, while flexible floor space has increased 150% between 2014 and 2017.
JLL expects flexible workspaces to constitute up to 30% of corporate commercial property portfolios worldwide. Although corporate adoption is still in its early days, there are certain factors that will continue to make this region a hotspot for co-working growth.
Distrii at Republic Plaza (Picture: Samuel Isaac Chua/The Edge Singapore)
A key driver, according to JLL, is that governments are encouraging entrepreneurship to offset the slow growth in traditional industries such as manufacturing and are offering financial resources and backing for small companies, many of which are located in co-working-style spaces.
In Singapore, for example, the government has supported the development of flexible locations such as the JTC LaunchPad, which is home to a number of tech start-ups. Similarly, the New South Wales government backed the development of Sydney Startup Hub, a 17,000 sq m tech zone that caters for aspiring entrepreneurs. Meanwhile, reforms introduced by the Japanese government to improve work-life balance and productivity are also pushing domestic companies to explore more flexible ways of working.
Flexible workspace by major operators in Singapore has grown by 70% to 0.9 million sq ft at end-2017 from 0.5 million sq ft at end-2014, according to JLL. They have capitalised on the soft rental environment amid an influx of new supply to expand their footprint to grab market share. This is particularly the case in the CBD, where URA’s statistics showed close to four million sq ft of net new supply came on stream between 2014 and 2017.
Singapore CBD skyline