After more than a year of working remotely, employees are expressing their desire to shift to the hybrid model of working. In response to the growing need for co-working offices within mixed-use retail locations, IWG – the parent company of Regus, SPACES and HQ in South Africa – and Orion Real Estate have collaborated to bring flexible workspace into the Promenade Mall in Nelspruit.
Partnerships like this allow companies to scale back their owned or leased property, reducing their overheads and providing them with agility that most traditional contracts can’t match. Altogether, IWG has added two million new users to its network of flexible workspaces this year – the most significant increase in its 30-year history.
Amid rising demand for hybrid work solutions, IWG has made a name for itself as a pioneer within mixed-use developments and shopping centres and continues to explore the trend actively, identifying prime retail locations and partnering with property experts who are forward-moving in the new world of work.
JLL estimates that co-working space in retail properties is predicted to grow at an annualised rate of 25% over the next few years. Flexible office space in retail locations will reach 3.4 million square feet by 2023, and nearly 55% of retail co-working spaces are located in suburban areas.
The Promenade Centre has distinguished itself as one of the leading shopping malls in the Mpumalanga district. Situated in the heart of Nelspruit and along the main thoroughfare, Samora Machel Drive (an extension of the N4 highway), the Centre creates a unique shopping experience for locals and travellers alike.
These two entities complement each other in every way. Promenade Centre boasts a diverse mix of tenants, such as Mr Price, Milady’s, Rage Shoes, Total Sports, Markhams, Beaver Canoe, RJ Jeans, The Fix, American Swiss, Old Mutual, Sheet Street, Boxer Super Store, and many more. The daily diversity of customers entering the mall is something to behold. Being a mixed-use development, it comprises of first-level office and medical suites amongst a wide variety of ground-level open-air village-style retail stores.
South Africa has experienced an uptick in the conversion of retail spaces into chic co-working offices in the last few months as people adopt the Hybrid model of work. It means that a range of resources are within easy reach – shops, restaurants, entertainment facilities and it is a magnet for new tenants. Achieving a better work-life balance by saving time for ‘life admin’, be it buying dinner for the evening, picking up the dry cleaning, or shopping for last-minute necessities is becoming a significant essential for employees.
“Having local amenities close and easily accessed is not only good for work/life balance, but it reduces travel times, making people more productive and healthier, having a positive effect on the environment. Meanwhile, the investment will flood in for new infrastructure and facilities, possibly one of the pandemic’s most dramatic and long-lasting legacies”, says Joanne Bushell, MD, IWG, South Africa.
“The post-pandemic world has offered an opportunity to re-evaluate how the workplace can enhance productivity and employee engagement through the growth of flexible office spaces as an asset class. Property owners realise that serviced offices have long been a popular alternative to simply finding one tenant, and demand for a flexible working option is increasing”, adds Bushell.
“The strength of the Regus brand, coupled with our vision of becoming a global player in the property space, this first franchise partnership in our thriving Promenade centre is our pilot project. Once this 800 sqm flexible office space solution is settled down we plan to engage with IWG to partner on more sites in South Africa.
We are very proud to be associated with IWG and are looking forward to a long and mutually beneficial business relationship.” – Franz Gmeiner CEO Orion Real Estate Ltd
For landlords concerned about the future of the traditional commercial property, pivoting to providing a flexible workspace represents an exciting opportunity.
“The pandemic has had a dramatic and permanent effect [on the world of work],” Mark Dixon, CEO and Founder of IWG explains. “But it’s merely accelerated a trend that’s been underway for several years – one that is irreversible.” He insists that the days ahead are bright for property owners and investors if they’re ready and willing to adapt: “The future of work is already with us,” Dixon concludes. “And it’s only going to improve.”
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