WARSAW GETTING STRONGER IN FLEXIBLE OFFICE MARKET IN EUROPE

2024 was an exceptionally dynamic year for Warsaw’s flexible office space market. Operators in Warsaw leased 28,600 sqm in 16 locations, representing almost 70% year-on-year growth. The most active player was The Shire – Beyond Coworking, which managed to lease more than 9,400 sqm in 5 locations. At the end of the year, the capital offered nearly 205,000 sq. m. of coworking space in 85 locations with about 25,000 workstations. 72% of the space occupied by flex operators is located in the center. This year, the flex office offering will expand by at least 6,000 sqm of new space currently under development. Savills experts point out that Warsaw coworking spaces are diverse in size, with the average area of such an office being 2,400 sqm.

The market for flexible office space in Poland is constantly evolving, and we foresee further changes in 2025 that will strengthen it. The emergence of new players, such as The Shire – Beyond Coworking and Ace of Space, testifies to the growing potential of this segment. It is worth noting that Ace of Space – an operator owned by Globalworth – brings unique know-how to the market resulting from synergies between operator and property owner. Globalworth manages a portfolio of facilities in major Polish cities offering nearly 580,000 sq. ft. sq. m. rental space, and consequently has experience in designing and delivering modern spaces.

Thomas Jodar, Head of Workthere Poland, Savills Polska

A particularly interesting trend is the growing popularity of flexible rentals not only among small and medium-sized businesses, but also among large corporations. Companies are increasingly looking for models that offer both comfort and the ability to customize the space to suit their individual needs.

COOPERATION IN THE MANAGEMENT AGREEMENTS MODEL

Worthere Savills experts note the trend of operators signing their first contracts in the “management agreements” model. The perception of such contracts in the flex segment abroad and in Poland is gradually changing and more and more owners and operators are opting for it. The definition of this type of contract can be somewhat vague, as there are many ways to structure it. However, the common denominator in it is a revenue and profit sharing model between the property owner and its operator.

From the operators’ perspective, the “management agreement” is an attractive formula, because it allows them to maintain greater flexibility and reduce capital commitment without having to sign a traditional lease. Property owners have been somewhat skeptical until recently, fearing the risks of not having a formal lease and the potential impact on property values. However, they are increasingly recognizing the benefits of a well-structured lease, which can translate into higher revenues and is better suited to the growing expectations of investors who want to offer flexible office space in their buildings. In developed markets, the effect is that the number of operators who prefer this model has increased markedly in recent years.

Thomas Jodar, Head of Workthere Poland, Savills Polska

CORPORATIONS LIKE SERVICED OFFICES

Serviced offices are an increasingly attractive option not only for small companies, but also for medium and large enterprises that need flexible solutions in the era of hybrid work. Due to the need to respond quickly to changing business expectations – for example, with a sudden need to increase space, create a more creative environment for selected teams or provide a convenient location – corporations are eager to use flex’s as a convenient alternative to classic leasing. The growing range of offerings on the market is attracting companies from a variety of sectors, including IT, finance, media, logistics or cyber-security, which are keen to instantly adapt their space to their current challenges and growth plans.

TENANTS VALUE THE STANDARD OF SERVICE

As the importance of flexible offices grows, so do tenants’ expectations regarding the standard of service. After the pandemic, there has been a noticeable trend toward choosing top-quality spaces that support productivity and build corporate image. Operators who focus on providing top-notch service and support will gain a competitive advantage and increase occupancy rates.

A NEW WAVE OF OPERATORS AND AN INCREASE IN STANDARDS

Analyses by Workthere Savills experts also show that 2025 will bring increased competition among operators. In addition to global leaders, new players such as Industrious and Cubo will emerge and dynamically expand their operations in Europe. At the same time, ESG principles, which entail sustainable development, will become increasingly important. As a result, well-designed office spaces create a comfortable and healthy work environment, which in turn has an impact on employee satisfaction and productivity. Operators must respond to these needs in order to remain competitive in a changing market environment.

The flex office market is entering the next stage of development, and Warsaw, being one of the most important European business centers, remains at the forefront of these changes. This is influenced by the need to respond quickly and flexibly to the changing needs of tenants and global trends. As a result, the Polish capital is strengthening its position as one of the leaders of innovative solutions in the real estate sector, attracting both national and international companies looking for modern solutions.