Flexible work spaces could trim the value of central London's office market by up to 25% over 10 years, Fitch Ratings reported, citing its latest report on disruptive technologies.
As remote work enjoys "strengthening tailwinds" in London, firms are able to downsize expensive office space and the city's central business district is expected to become more available for uses other than offices, according to the June 6 report.
The report noted that headquarters and new office developments are now being designed with "agile" formats, including hot-desking, bookable rooms and shared facilities.
"The main barriers to remote working are cultural, not technological," the report said. "And as millennials rise up the ranks we predict business culture will evolve, lowering cultural barriers." The rating agency said the U.K. is lagging other European countries in terms of routine homeworking rates, concerns for which can be overcome with shared work space.
Rising demand for flexible work space is driving "double-digit" year-over-year growth in supply, Fitch noted. The agency predicts the market share of flexible work space stock will increase "sharply" from its current 5%.