Flex Office Demand Grows: Landlords in Hong Kong and Singapore Respond

In the evolving landscape of commercial real estate, landlords in Hong Kong and Singapore are increasingly turning to flexible office operators. This shift is largely driven by multinational corporations reshaping the industry’s risk profile and ensuring sustained demand in the long term.

The Rise of Global Companies in Flexible Workspaces

One of the key factors fueling this transition is the notable change in the type of businesses seeking flexible workspaces. Currently, global corporations make up 41 percent of flexible office users in the Asia-Pacific region, marking the highest share globally. This figure is nearly three times greater than the 14 percent seen in North America, as highlighted by Piers Mallitte, head of Workthere APAC at Savills.

This evolution represents a significant shift from the initial phase of the flexible workspace sector, which predominantly catered to start-ups and smaller enterprises, according to analysts. The growing interest from larger corporations indicates a maturation of the market.

Changing Risk Profiles

“The major turning point is the shift in risk profiles,” Mallitte explained. “Flexible workspace operators are now attracting reputable multinational tenants rather than high-risk start-ups. While this approach isn’t entirely foolproof, operators and landlords conduct comprehensive due diligence before granting access to new tenants.”

The differing office fundamentals between Hong Kong and Singapore further illuminate why landlords are reevaluating flexible workspace strategies. As these two cities adapt to the changing demands of multinational corporations, the flexible office sector is poised for continued growth and transformation.