The Value of a Busi­ness’s Flex­i­bil­ity and Agility

Kyiv Post Legal Quarterly - - News -

Shared work­places are a tool that can be used to re­flect an or­ga­ni­za­tion's cul­ture, val­ues and pri­or­i­ties. The type of shared work­place a com­pany uses gives in­sight into the norms that com­pany op­er­ates within, whether in­ten­tion­ally or not. For ex­am­ple, ser­viced of­fices re­flect a more for­mal, pri­vate and cus­tom­ary cul­ture, whereas co-work­ing fa­cil­i­ties re­flect a more pro­gres­sive, trans­par­ent and mod­ern cul­ture. Al­though both mod­els may re­flect much more than just a busi­ness cul­ture, choos­ing one model over the other is cer­tainly a lens into the type of val­ues a com­pany has. Or­ga­ni­za­tions are start­ing to ini-tiate the use of this new and in­no­va­tive space model to sat­isfy the requirements of spe­cific de­part­ments or pro­ject teams that may not fit the cul­tural mold of legacy of­fice space. Whether it be to pro­mote in­no­va­tive think­ing, or ac­cess a bet­ter work ex­pe­ri­ence for em­ployee re­ten­tion, con­tem­po­rary shared work-places of­fer di­verse ways to sup­port the needs of oc­cu­piers -from small pri­vate firms to large public in­sti­tu­tions (Global CBRE Re­search).

A lo­cal sur­vey of the top largest co-work­ing cen­ters and ser-viced of­fices in Kyiv con­ducted by CBRE Ukraine found that core de­mand for shared work­place in Kyiv orig­i­nates from IT and Busi­ness Ser­vices spe­cial­ists aged 25-44, work­ing re­motely as solo­preneurs and con­sul­tants, or as a part of small pro­ject teams and start-up com­pa­nies.

Co-work­ing spa­ces of­fer a di­ver­sity of en­vi­ron­ments that give oc­cu­pants op­tions to choose where and how they want to work—and op­tion­al­ity is a key value for mo­dem mo­bile em-ploy­ees. A re­cent sur­vey of large cor­po­rate oc­cu­piers by Global CBRE Re­search re­vealed that to­day's la­bor force puts a high de­gree of im­por­tance on the de­sire for a great "work ex­peri-ence"—specif­i­cally, the func­tion­al­ity of the work­place, the free-dom of work style and the sense of com­mu­nity be­tween re­lated or­ga­ni­za­tions. These spa­ces of­fer a unique op­por­tu­nity for em-ploy­ers to ac­cess the work ex­pe­ri­ence much of their tal­ent base is call­ing for (Global CBRE Re­search).

There are a num­ber of el­e­ments to con­sider be­sides the head-line lease cost when com­par­ing the costs of shared work­places with those of tra­di­tional leased of­fices (Global CBRE Re­search). Aside from vi­brant in­fras­truc­ture and flex­i­ble cul­ture at the core of the con­cept, Kyiv's shared work­place model at­tracts mod­est space users seek­ing lower-cost and shorter-term so-lu­tions com­pared to those of­fered by tra­di­tional of­fice lease agree­ments. Be­sides lower lease cost, the lack of a con­tract ne-go­ti­a­tion process, trans­par­ent pric­ing, and turnkey so­lu­tions are the other ma­jor ben­e­fits of co-work­ings and shared of­fices.

The av­er­age desk cost in a given co-work­ing space in Kyiv ranges from $70 to $300 per month, with the price ris­ing the closer the lo­ca­tion is to the city cen­ter. The cost range for pri-vate of­fices in co-work­ing spa­ces is there­fore higher, start­ing from $100 per month and reach­ing $700 per month. Among the two key for­mats both open space set­ting and pri­vate of­fices are pop­u­lar with shared work­place users in Kyiv, where de­mand for open space seat­ing - whether a hot desk or a ded­i­cated desk - slightly dom­i­nates at 55%. With the aim of ben­e­fit­ing from the high­est cost ef­fi­ciency, more than 80% of users choose a monthly rate plan as op­posed to daily or weekly, with monthly plans usu­ally re­sult­ing in rates 1.5-2 times lower than those of­fered on a daily ba­sis.

Ac­cord­ing to a sur­vey of co-work­ing users con­ducted by Global CBRE Re­search, com­mu­nity and net­work­ing is a top fea­ture co-work­ing space users look for when choos­ing space — of course, in ad­di­tion to a con­ve­nient lo­ca­tion that takes them out of their home en­vi­ron­ment. With the ever-grow­ing num­ber of al­terna-tive of­fice lo­ca­tions in Kyiv, em­ploy­ees have bet­ter chances of find­ing a work­place that meets their lo­ca­tion and of­fice in­fra-struc­ture pref­er­ences. Such tai­lored work­ing en­vi­ron­ment set-tings spur work­ers' well-be­ing, as the qual­ity of a work­place has been shown to have a grow­ing im­pact on health and stress lev­els.

The im­por­tance of com­mu­nity and net­work­ing is val­ued by

“There are a num­ber of el­e­ments to con­sider be­sides the head­line lease cost when com­par­ing the costs of shared work­places with those of tra­di­tional leased of­fices."

em­ploy­ees of com­pa­nies large and small, and land­lords are re-spond­ing to this call to ac­tion. They are fo­cus­ing on mak­ing the phys­i­cal build­ing a more con­nected ecosys­tem of di­verse uses, rich pro­gram­ming and ameni­ties sup­port­ing a sense of commu-nity. The pri­mary ob­jec­tive is to im­prove the oc­cu­pier ex­pe­ri­ence and pro­mote re­ten­tion, but the out­comes are vi­brant cam­puses that serve a greater pur­pose than simply be­ing places to work. To­day's busi­ness strat­egy calls for the rapid test­ing of ideas—the idea of "fail­ing fast." Co-work­ing mod­els draw on con­cepts first de­vel­oped for busi­ness in­cu­ba­tors by uni­ver­si­ties to pro­mote shared learn­ing and co-in­no­va­tion (Global CBRE Re­search). In Kyiv, for in­stance, Ukraine's first in­no­va­tion park, Unit City, is about to open a Cha­sopys-UNIT co-work­ing, a na­tional co-work­ing brand op­er­at­ing another lo­ca­tion in Cen­tral Busi-ness District (CBD) from 2013. Co-work­ing will work within Unit City in or­der to cap­ture the tar­get au­di­ence of start-ups and en­trepreneurs from data driven in­dus­tries. The idea is to al­low res­i­dents to co-cre­ate in the en­vi­ron­ment where knowl-edge shar­ing is wel­come.

An over­all trend to note is the ac­cel­er­a­tion of new sup­ply on the shared work­place mar­ket. One of the first in­ter­na­tional shared of-fices and co-work­ing space com­pa­nies, Re­gus, en­tered the Ukrai-nian mar­ket in the late 1990s. The com­pany is con­tin­u­ously ex-pand­ing, with a new lo­ca­tion about to open in Fo­rum West Side BC, by tak­ing 1,500 sq m of space, in ad­di­tion to their al­ready ex­ist­ing seven of­fice lo­ca­tions in Kyiv, pre­dom­i­nantly lo­cated in CBD. Another in­ter­na­tional co-work­ing brand, New Work Labs, has re­cently en­tered the mar­ket, set­tling in the heart of Kyiv in SC Globus with 1,000 sq m in take-up.

Con­sid­er­ing the grow­ing shared work­place sup­ply, ca. 70% of re­spon­dents in­di­cated no neg­a­tive im­pact of grow­ing com­peti-tion on their busi­ness per­for­mance. In fact, ca. 90% of those sur­veyed have fur­ther ex­pan­sion plans look­ing ahead to 2018-2020 pe­riod, re­spond­ing to grow­ing in­ter­est on the mar­ket. Among com­pa­nies-re­spon­dents plan­ning to ex­pand, the ma-jor­ity of re­spon­dents (45%) in­di­cated no pref­er­ence in terms of the ge­o­graph­i­cal lo­ca­tion of their fu­ture of­fices. Nev­er­the­less, a clear ma­jor­ity of ex­ist­ing sup­ply is con­cen­trated in Kyiv's CBD, which is why ca. 40% of re­spon­dents still con­sider CBD as their pre­ferred ge­o­graph­i­cal area for fu­ture ex­pan­sion.

An­a­lyz­ing in­ter­est by prop­erty type, al­most 70% of re­spon-dents fa­vor busi­ness cen­ters over stand­alone build­ings and street re­tail for their prop­er­ties in the pipeline, as this kind of real es­tate tends to of­fer a cen­tral lo­ca­tion, large floor space, and in­clude in­stalled HVAC and fire safety sys­tems. We an-tic­i­pate that the shared work­place mar­ket of Kyiv will stay dy­namic on both the de­mand and sup­ply side, en­cour­aged by sub­stan­tially re­duced good qual­ity tra­di­tional of­fice sup­ply on the mar­ket.

The ar­ti­cle is based on Global CBRE Re­search re­port "U.S. Shared Work­places Part 2" and a lo­cal sur­vey con­ducted by CBRE Ukraine.

CBRE Ukraine

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