The transformation of offices to office as a service

The traditional office is disappearing. Employers and employees no longer see offices as a workplace alone, but as a dynamic place that can be adapted without much trouble. This trend, also called office as a service, will have a major impact on the fairly traditional real estate market.

By: Dimitri Reijerman

Sven Brookhuis is an entrepreneur active in several companies that are involved in marketing concepts around office as a service. During Bits, Bricks & Behaviour, on November 22 at the Jaarbeurs Utrecht, he will on behalf of Skepp give his view on this development and the tension it may cause for vested interests.

“I was already involved in offices sixteen years ago and started in office design,” Brookhuis explains. “Back then, you rented a concrete box for ten years. You composed the design of your office yourself. That world is changing rapidly. They have changed into places for exchange, of knowledge, of energy.”

According to Brookhuis, it is becoming increasingly difficult for organizations to estimate what office needs they will need in, say, 1.5 years, “simply because you don’t yet know with whom you are going to do that and what they are going to do. With office as a service, you can get what you need at that moment. That could be a meeting room, a room where you can work in a concentrated manner or a room where you can just chill out.”

Discrepancy in the built world

In Brookhuis's view, this demand for flexibility has a significant impact on the real estate market: "A discrepancy is starting to emerge in the built world. The projected age of the shell is different. More and more companies are starting to look at how you can give a building a kind of shell, so that multiple life cycles are possible within the same building."

It is remarkable that it is not so much the self-employed who are causing the trend towards more flexibility. “800,000 of them go to work in construction with a toolbox in the back of their van, 100,000 of them work behind the kitchen table and the other 100,000 are on their way to customers,” he outlines. According to Brookhuis, this is why only a small proportion of the self-employed in the Netherlands work in shared office spaces. “The demand for these services mainly comes from the slightly larger organisations that are beginning to realise that, in addition to a supply of permanent employees, solutions are needed for the flexible shell. The traditional office supply is also becoming more flexible.”

The entrepreneur also sees that different functions, such as living and working within a building, are starting to mix: “You see that especially in the city centres. For example, there are hotels where people work and office buildings where shops are located. Companies that have great difficulty attracting people are increasingly beginning to understand that the quality of the immediate environment has a lot to do with it. This process is really happening very quickly.”

Flexible contracts

The office industry needs to get used to different occupancy rates – “as if it were a hotel,” says Brookhuis – and to the fact that flexible contracts are becoming the norm. “Investors are realizing that an office that develops has more value than an office that works with ten-year contracts,” he thinks.

In Anglo-Saxon countries, dealing with office environments that have a service character is already much more normal than in the rest of Europe. And that trend is continuing, believes Brookhuis: “Globally, we think that office as a service will become the standard.”

However, Brookhuis is also curious to see how this development will hold up if the economy goes into recession again, especially since the real estate world is very sensitive to economic cycles: “That is because flexibility costs money. Renting a car for a day is simply more expensive than a four-year lease contract.”

Looking a bit further into the future, Brookhuis outlines: “There are futurists who foresee a ‘third place’, next to the workplace and home. This is partly because people are going to work less, for example to 4 days. The question is what this third place will look like.”

In his view, people need to start realizing that work can be a lot of fun. And that they start seeing work as an extension of their personality and make choices that suit them: “I hope that the current generation can also pick up some of that. People are getting more choices, thanks to technology.”

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