Expert View: Alex Gathercole on Managed Solutions, Market Evolution and What's Next
Alex Gathercole, Director within our Central London office leasing team is Avison Young’s dedicated flex specialist. We get her thoughts on the rapidly evolving flex market, the rise of managed solutions and the biggest opportunities and challenges facing the flex market.
1. What has been the biggest change in how flex solutions are delivered to occupiers over the course of your career?
The biggest change for me has been the shift in perception as much as the product itself. Early in my career, serviced offices were often seen as the last resort, basic space with poor service and not somewhere most occupiers aspired to be.
Since then, the market has continued to evolve, from operator led models to greater landlord involvement, and now the growth of managed solutions. Flex today is less about just taking a short-term space, but more about delivering high-quality, service-led workplace that aligns with an occupier’s culture and ways of working which is increasingly being adopted by all types of larger corporate occupiers, as well as the typical startups and SME’s in growth phases.
2. There doesn’t seem to be a set definition of managed space. Can you define it?
Managed space remains loosely defined across the market, but it broadly sits between traditional leasing and serviced office models.
The Avison Young definition is typically a self-contained space for a single tenant, where all day-to-day operations, services and management are delivered by an operator on behalf on the occupier.
What really sets it apart is, occupiers get their own identity and dedicated space, but without the burden of setting it up and running it themselves. It’s that balance of control and convenience that’s driving a lot of its appeal.
3. Why have managed solutions seen such growth in recent years?
The growth in managed spaces really comes down to how occupier priorities have shifted.
There’s a much bigger focus now on flexibility and being able to adapt quickly, particularly given how uncertain the last few years have been. At the same time, many businesses don’t want to commit the capital or internal resource to delivering and managing the space themselves.
Managed solutions address both points, they offer speed, cost clarity and a much lighter operational burden, while still giving occupiers elements of a tailored end product. That combination has made them increasingly attractive, particularly post-pandemic.
4. How have flex occupiers needs changed over your career? Is current stock meeting their expectations?
Occupier expectations have moved on. It’s no longer about just having space, it’s about the quality of space and what it enables.
There’s more emphasis now on design, amenity, and overall experience, as well as flexibility around how the space is being used and long its used for. Supporting collaboration, culture and employee wellbeing has become a key driver.
The top end spaces that offer all of these factors are performing well, even with some very high rent levels. Some of the older or less amenitised stock is finding it harder to compete.
5. Given flex provider take-up has slowed across Central London, is this a signal that demand from occupiers requiring flexible options is slowing?
I don’t think a slowdown in flex provider take-up necessarily means demand is weakening, it’s more a sign the market is maturing.
We’re seeing operators transition from expansion led growth to a more disciplined focus on profitability and portfolio optimisation. At the same time, landlords are much more active in this space than they were previously.
Demand from occupiers is still there, but it’s shifting towards the managed and enterprise led solutions rather than generic co-working. The market is evolving, not contracting.
6. What is the biggest opportunity and challenge you see for the flex market on the horizon?
One of the biggest opportunities for the flex market is the continued evolution of workplace technology, including AI which can add real value. There’s a big opportunity to use data more effectively to understand how space is actually being used and to improve both design and day-to-day experience.
In terms of challenges, the biggest challenge, in my view, is cost. Business rates, fitout costs and the cost of capital are all moving in the wrong direction, and that puts pressure on delivering the level of quality that occupiers now expect, without pushing pricing too far. It’s an impact on both the operators’ margins and affordability of flex solutions for occupiers.
Balancing these cost pressures while continuing to deliver high quality, service led environments will be critical to sustain long term growth.
