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Ahead of MIPIM 2020, one of the world’s largest real estate events, IWG’s Sebastian Koziara shares insights on how perceptions are changing in his region
MIPIM – the world’s premier real-estate event – will take place in Cannes, France, welcoming influential players from the international property industry. As the leading global flexible workspace-provider, Regus parent company IWG will be there to spread the word about the opportunities for investing in this rapidly growing sector of real estate.
Sebastian Koziara, Network Development Director in Eastern Europe, will be in attendance. “MIPIM is a great opportunity to meet potential investors, partners and companies who would like to discuss our offer.”
In terms of the Eastern European market, Koziara says Poland and the Ukraine are the main focus for 2020. This is due in part to the comparative size of their economies, the number of major cities and population sizes. Still, the region’s smaller nations – such as the Baltics (Lithuania, Latvia and Estonia), Slovakia and Georgia – are also experiencing an upward trend in demand.
“Central Eastern Europe is part of the global trend,” says Koziara. “What we have seen is continual growth and demand, driven by both corporate and local clients, as well as SMEs. Perhaps the only difference is the market is not so far along in terms of the number of centres and competitors compared the rest of Europe. But the region’s corporate clients and the economies are driving demand.”
Is there any sign of the flexspace sector’s slowing down in the region? “Growth is still very positive,” says Koziara. “In Warsaw and Kiev especially, there is a lot of construction going on, and many new projects both for conventional office space and flexspace.”
When there’s the prospect of an economic downturn, demand for flexspace during a downturn has tended to increase as, in the face of uncertainty, companies seek workspace solutions that let them upscale or downsize their office portfolio in line with their business outlook. Flexspace proves to be a recession-proof investment for both businesses and landlords.
Koziara says clients operating in Eastern Europe are part of this trend. “What we’ve seen in our market is there are more and more large corporate clients looking for flexible solutions,” he says. “These clients may be preparing to adapt for the next economic cycle. When I talk to developers, all these companies confirm that when looking for a very large space, they’re all thinking that part of the space should be flexible. So there’s a demand for landlords to have certain parts of their building reserved for coworking for corporations.”
It all comes down to adaptability: “And it’s very clear that big clients are trying to mitigate the risk of the real estate office market by having part of their portfolio that’s flexible, so they can easily grow or downsize in case of change in the market,” he adds.
From a landlord’s perspective, having a flexspace offering under the roof can supplement their current offering of traditional workspace – helping them retain clients for longer. “By having a flexible workspace-provider in the building, landlords can offer more flexibility to clients,” says Koziara. “If existing corporate tenants grow out of their conventional office space, landlords are able to say: ‘We may not have space for you now, but we have Regus or Spaces who can offer you this kind of service.’ There’s a very clear synergy for all parties. And it increases the value of a landlord’s property. Because, in the end, many tenants will consider leaving the building in need of more space. But if they can grow inside the building in a Regus Centre, it makes it easier for them to stay.”
For property experts looking to delve into the flexspace market, Koziara says that Regus, as well as IWG’s suite of brands that includes Spaces, No18 and HQ, provide stability and global network coverage – with more than 3,500 locations. “In Warsaw alone, for example, we already has 18 locations – none of our competitors can offer this kind of existing network covering many areas of the city,” he says.
“Our global network is growing, the flexspace market is growing, so anybody who wants to understand how it works, they can meet me at MIPIM 2020. It’s a very good time now to discuss this kind of offer.”
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