Office market freeze causes both tenants and landlords to innovate

Since COVID, offices have taken on a new role in people’s lives. There is no better proof than the Budapest Research Forum reports which show the volume of office lease transactions has fallen by 50 percent in the last three years. It seems companies are having a hard time justifying having space for everyone, but also don’t want to give up the physical connection to their employees. So far most companies have simply postponed any decision, but an increasing number are now actively cutting back on space. As landlords have yet to feel any real pressure, few have taken steps beyond a superficial lobby upgrade to attract people back to their buildings.

This will change, as tenants are finally making decisions, with an increasing number moving to flexible offices or subleasing part of their current office. Dynamic Offices – a Hungarian-American startup – is taking a more innovative approach. The Dynamic Offices team realized that people at every company have developed habits for visiting the office and forming patterns of occupancy throughout the week. This creates an opportunity to adjust the size of the office daily, depending on the number of people visiting the office. Their solution reduces office occupancy costs by 25 percent and cuts carbon emissions by around 50 percent.

“The office is no longer the place we do most of our work,” says Michael Smithing, CEO. “The focus today is much more on the social aspect. So on some days, companies need a larger office, and on Fridays, they barely need any space at all. In order for this
to work, offices need to be dynamic.”

The Budapest-based firm – which promises to keep buildings full of people – is offering offices in several locations in the Hungarian capital from the beginning of 2023.