Page 49 - Layout 1

PROPERTY

fell during lockdowns around the world, ulti- and those that cannot agree to terms will ing real estate portfolios becoming more agile,
mately testing the sustainability of some flex- likely close. In turn, cash-rich, opportunistic reductions in lease durations, the need for
ible space models. Co-working space operators flexible space operators and/or investors could workplaces to support the employee experience
will face the toughest test, as freelancers and take advantage of this market consolidation.” and engagement programs, health, and well-
startups opt to work from home. Simultane- Mr. Duong Do also said that many issues being in the office, and the amenities race
ously, large corporations are shedding mem- arising from the Covid-19 pandemic had a within the workplace will continue to drive
berships as a quick cost-saving solution. negative impact on Toong’s partners. “We demand for co-working space,” she noted. JLL
While most flexible space operators remain are still working on late payments and bad Research also predicts that co-working space
open for business, they have been forced to debts,” he said. demand will continue to increase as a result of
adhere to government guidelines. If social For Dreamplex, their main challenge is Covid-19, though in a different form than it
distancing of two meters is required, it con- awareness in the market that its product actu- took before the pandemic. In fact, JLL believes
siderably reduces the space allocated to indi- ally exists. “While we are starting to sign up that 30 per cent of all office space will be con-
viduals within a property. In practice, this our first enterprise customers and have a loyal sumed flexibly by 2030. While there are short,
means many flexible offices will see extremely group of larger companies that have placed medium, and long-term implications for the
low utilization rates and, in some cases, will their workplace and employee experience in sector from Covid-19, the future of real estate
remain nearly empty. Profitability in these our hands, we are still on the look-out to raise is co-working space.
types of co-working spaces is driven by high awareness among companies in Vietnam,” said Meanwhile, Mr. Duong Do affirmed that
seating density and rental arbitrage. Flexible Mr. van Rossum. “For many companies, out- co-working space is not a temporary trend
space operators with a “hybrid” model that sourcing their workplace and employee expe- but a natural shift in the office market. “Co-
leans on long-term commitments in private rience is not something they consider just yet. working space has advantages to push this
office space as well as co-working may weather Often, these companies will rent a floor or part shift, such as affordable, attractive, and flexible
the storm. Those relying on a pure co-working of a floor in an existing office building, hire a space that can take care of workers’ lives,
model, however, will likely suffer from the designer, buy all their furniture, and then operate thereby contributing to improving each indi-
impact of Covid-19. the office themselves.” vidual’s performance and quality of life,” he
“These challenges will expedite a long- In the time to come, Ms. Xuan said, the said. “There are many businesses in this field
predicted consolidation of the flexible space impact of Covid-19 will not dramatically change that stop at completing facilities and don’t
market,” said Ms. Xuan. “Investors will be the global real estate market but will accelerate go on to improve the workplace environment.
significantly affected by operators closing existing co-working space trends. “The devel- Although co-working space has potential,
their spaces, creating vacancies in their assets. opments that initially drove the explosive the opportunities will not be shared equally
Covid-19 will influence lease re-negotiations, growth of the co-working space market, includ- across all operators.” %

APRIL 2021 | VIETNAM ECONOMIC TIMES | 47