OREGA REPORT SIGNALS STRUCTURAL SHIFT IN UK OFFICE MARKET AS FLEX GOES MAINSTREAM

Flexible workspace is no longer a side strategy in the UK office market. It is rapidly becoming one of the defining forces reshaping how commercial property is valued, operated and monetised.

New research commissioned by workspace provider Orega suggests the institutional debate around flex space is effectively over. More than 81% of UK landlords, advisers and asset managers surveyed said they plan to increase their exposure to flexible workspace within the next three years — a decisive signal that the sector has moved beyond its origins as a tactical leasing solution into a structural component of mainstream real estate strategy.

The implications extend far beyond occupancy levels. As economic uncertainty, changing workplace behaviour and demand for operational agility continue to reshape corporate decision-making, flexible workspace is increasingly being treated not simply as a way to fill empty floors, but as a competitive asset class capable of driving tenant retention, revenue resilience and long-term portfolio performance.

The findings, published in Orega’s Attitudes of Landlords, Advisers and Property Asset Managers to Flex Space 2026 report, point to a market entering a more mature and operationally complex phase. The question is no longer whether flex belongs within office portfolios, but who is best positioned to operate it efficiently, profitably and at institutional scale.

Across the 500 respondents surveyed, a third said up to half of their office holdings now consist of flexible workspace, underlining how deeply flex has become embedded across UK commercial property portfolios. Almost a quarter said flex space now represents between 25% and 50% of total office allocation — a marked departure from historic perceptions of flex as secondary to traditional leasing models.

The appetite for expansion is particularly strong in core city markets. More than 84% of respondents in London said they expect to increase exposure to flex space, with Manchester close behind. Larger portfolio owners are also accelerating investment. Among respondents managing between 1.1m and 5m sq ft of office assets, more than 42% said they plan significant flex expansion — considerably above the market average.

The rationale behind this shift has evolved sharply. Landlords and asset managers are increasingly viewing flex space not as an occupancy play, but as a strategic tool to improve the overall competitiveness of office assets.

According to the research, the strongest drivers behind flex adoption are attracting and retaining occupiers, improving tenant experience across entire buildings and increasing occupancy and revenue potential. The modern office is increasingly being repositioned as a service-led environment rather than a static leased asset.

For occupiers, the appeal is rooted in operational flexibility. Respondents identified the ability for businesses to scale space up or down quickly as the single biggest attraction of flex workspace. Access to premium locations that might otherwise be unaffordable and the simplicity of all-inclusive pricing structures were also identified as major drivers of demand.

Significantly, the report suggests flexible workspace is no longer viewed primarily through the lens of hybrid working. Instead, it is increasingly being treated as core business infrastructure that enables companies to manage uncertainty, reduce operational burdens and remain agile in volatile economic conditions.

That uncertainty is expected to continue driving growth. More than a third of respondents identified economic instability as the biggest catalyst for flex expansion over the next five years, as businesses move away from long-term lease commitments in favour of shorter, more adaptable operational models.

Yet despite growing demand, the report highlights a major challenge for landlords and investors attempting to scale flex operations internally: execution.

Operational complexity, valuation uncertainty and lack of in-house expertise all emerged as significant barriers to expansion. The findings underline the reality that flex workspace operates fundamentally differently from traditional office leasing, requiring specialist expertise in technology, hospitality, customer experience and operational management.

That operational gap is increasingly strengthening demand for specialist flex operators. Nearly 40% of respondents said they favour partnerships or management agreements with specialist operators, compared with a third who prefer in-house models.

However, scrutiny of operators is intensifying as the sector matures. Reputational risk, performance transparency and contractual complexity were all identified as key concerns among landlords and asset managers considering third-party partnerships.

The message emerging from the market is increasingly clear: operators seeking institutional support must demonstrate credibility, operational discipline and clear alignment with landlord objectives.

Commenting on the findings, Alan Pepper, CEO of Orega, said: “This independent research confirms what we are seeing on the ground—flex is not an optional extra, it is a core part of how office buildings are positioned and operated.”

Pepper said the sector had now moved beyond cyclical demand patterns and become structurally embedded within the UK office market.

“Flex is no longer cyclical or opportunistic—it has matured and is a structural part of the market. It is reshaping how landlords compete, how buildings are operated, and how occupiers engage with workspace,” he said.

However, he cautioned that future growth would depend heavily on operational capability.

“Our survey indicates that as flex develops, its operational complexity remains significant. That is why we are seeing growing demand for experienced and trusted professional operating partners who can deliver not just occupancy, but service, technology and long-term value. The opportunity is significant—but execution will be key, particularly if flex is to be institutionally accepted.”

The findings reinforce a broader shift taking place across the UK office sector, where flexibility, service integration and operational agility are becoming central to how landlords compete in a rapidly changing commercial property landscape.