Flexi hours spur office sector
Higher demand for serviced offices and co-working spaces
PETALING JAYA: Flexible working hours, driven by technology changes, is spurring demand for serviced offices and co-working spaces within the local property market.
Property consultancy Knight Frank said the growth in demand for working spaces has become more pronounced within the Klang Valley, which continues to see the expansion and emergence of global and local co-working operators respectively.
“With changes in technology supporting flexible working culture, the serviced office and co-working segments are gaining popularity,” Knight Frank Malaysia research and consultancy executive director Judy Ong said in a report.
“With strong government-led initiatives by the Malaysia Digital Economy Corp, leading to the launch of Malaysia Digital Hub and the Malaysia Tech Entrepreneur Programme, demand for serviced office and co-working space is expected to grow across a diverse mix of industries and professions such as technology start-ups and small and medium enterprises.”
Meanwhile, Malaysian REIT Managers Association chairman Datuk Jeffrey Ng also noted the trend for such co-working spaces, which he said has created “business disruptions” on the office segment of the market.
He said this was an opportunity for office operators. “Redevelop and convert old office buildings or warehouses into modern co-working office spaces, targeting millennials seeking a workplace lifestyle. This will also see cost-conscious entrepreneurs, freelancers and new startups leveraging on a strong business networking platform.”
Ng added that landlords should seize the opportunity to tap unused and untenanted spaces.
Meanwhile, Knight Frank’s Ong said housing affordability remains a key issue in Malaysia, particularly in the capital and key cities.
“House prices which have been trending up since 2010 continue to outpace the rise in income levels and with that, the prevailing median house prices are beyond the reach of most Malaysians.
“Coupled with the slew of cooling measures implemented progressively since 2012 to curb excessive speculation in the property market, sales volume has continued to decline.”
To address weaker sales number and falling revenue, Ong said many developers have turned their focus to the affordable housing segment.
She noted that under Budget 2018, the Government had increased allocation to address rising cost of living and affordable housing issues, among the lower to middle income segments of the population.
Ong added that the recent freeze on four components of the property market, including condominiums and serviced apartments priced RM1mil and above, will provide a breather to the challenging luxury residential segment.
“Developers are expected to take stock of the situation by reviewing and re-planning their proposed products and may further defer property launches.
“We expect to see more bite-size units which translate to lower quantum pricing (below RM1mil) coming into the market although moving forward, there may be risk of oversupply in this category of units.”