If the past year has taught businesses anything, it is the acute importance of being dynamic and adaptable. This includes rethinking how building structures can operate in the commercial real estate marketplace and how existing structures can adapt to fit within the ebbs and flows of the industry.
As a result of an unpredictable year, we have witnessed a rise in the leasing and use of flex spaces, unique from traditional structures such as office and industrial buildings. We sat down with Matthew Curran, Vice President of Brokerage at the MacKenzie Companies, to discuss what flex office spaces are, their benefits and how they fit in the CRE market now and in the future.
What is a Flex Office Space?
According to Curran, “Flex office space is typically defined as a single-story commercial structure built out largely for office use with a warehouse component toward the back of the building. A drive-in or dock high loading door in a flex space allows for direct shipping and receiving to the premises. Most of the flex office spaces we see have 16’ to 18’ clear height.”
Flex buildings in the Baltimore Metropolitan market generally have a light industrial zoning, which allows for office, warehouse, production, assembly uses and more. These types of dynamic spaces offer the malleability required in today’s ever-changing market.
“Much of the older flex products in our market were originally used for light industrial uses,” Curran continues, “in many cases, they are still used in this way.”
Many of the newly developed flex buildings in our market are constructed to accommodate a more extensive build-out and uses such as for typical office space, medical buildings, showrooms and small businesses operations.
“They are beneficial to businesses with a need for mostly office space while accommodating their warehouse and storage needs in the same facility,” Curran adds.
What are the Benefits of Leasing a Flex Office Space?
There are several benefits to leasing or owning flex office space. Flex office spaces provide businesses the ‘flexibility’ of housing both their day-to-day office employees and their warehouse or production space in the same facility.
According to Matt, the versatility of flex office space “allows for better collaboration between employees and eliminates inefficiencies of having separate office and warehouse locations. In many of the Baltimore submarkets, flex spaces are also an economical option when compared to multi-story office buildings.”
There are several industries that can benefit from this type of space. At the MacKenzie Companies, we see all types of businesses and industries occupying flex spaces including contractors, engineering, research & development, technology, logistics, government contractors, showrooms, fitness, education and much more.
How Did Flex Spaces Ease Headaches During the Pandemic?
As experts who are deeply entrenched in market data on the regular, our brokers realized intimately the benefits that flex office spaces offered during the height of the pandemic. One distinct benefit of occupying a flex space during the ‘COVID era’ was, and still is, having direct access to your office.
“Tenants in multi-story office buildings share common areas of the building including lobbies, elevators, bathrooms and, in some cases, conference facilities and fitness centers. Occupying a flex office space with a direct entrance eliminates these shared facilities,” Curran stated regarding the ability for flex spaces to lessen the risk of contact with other individuals.
From a social distancing standpoint, this factor helped reduce the chances of spreading the virus and continues to be an added benefit as we approach the tail end of the pandemic.
How do Flex Spaces Fit Within the Parameters of Commercial Real Estate in the Future?
Curran has high hopes for the potential of flex office spaces in the marketplace, primarily in the Mid-Atlantic Region. “I believe flex space will continue to be a very strong product type in the Baltimore Metropolitan market,” he states, “The wide array of uses that flex space can accommodate, coupled by the velocity of the industrial market, should keep vacancy rates low in the future.”
Ultimately, flex office spaces aren’t going anywhere as we approach mid-year 2021, and the mobility they offer within the marketplace offers universal benefits for business owners and employees alike. They are representative of the shifting tides that favor flexibility over traditional structures that offer more constraints than opportunities to shift strategies. To learn more about Matt Curran and his role at the Mackenzie Companies, click here.
Stay on Top of the Trends in 2021 with MacKenzie Commercial Real Estate
At the Mackenzie Companies, we are closely following the market trends within the framework of the Baltimore Metropolitan Area. We strive to stay ahead of the cusp so we can best inform our clients and partners. To get in touch, contact our team of Maryland commercial real estate professionals by calling 410-821-8585. We know local matters and we are proud to serve the Mid-Atlantic region with offices in Baltimore City, Baltimore County, Harford County, Howard County, and Annapolis.