There is a need for flexible leases within the commercial sector, according to privately owned business park operator Inospace, and the Covid-19 pandemic has accelerated this demand. “While we have had requests for short-term leasing for a while now, the pandemic prompted us to incorporate our flexible rental model of micro-industrial and office spaces into bigger and bigger commercial leases,” says Inospace marketing director Jodi Sher. “We therefore introduced a flexible lease option, called the InoLease, across our portfolio of business parks.”
Sher says the flexible lease structure is a significant drawcard for companies, especially in challenging economic times. “Since the introduction of the flexible option in March, we have seen a significant spike in the demand for very short lease terms. Inospace signed more leases in June and July during lockdown than it did last year, which highlights businesses’ desire for flexible arrangements.” Among the businesses showing interest in the pay-as-you-go option are some of SA’s biggest retailers. “They need immediate space for both slow- and fast-moving goods and are not interested in signing lengthy long-term leases,” says Jacques Weber, the company’s operations manager.
As more businesses make use of on-demand warehouse and industrial spaces for stock, the popularity of month-to-month warehousing solutions is not likely to subside. “Secure, serviced business parks where businesses can store and distribute stock will meet this need. When their supply lines eventually stabilise and they have no long-term commitments, then they can make longer-term decisions.” This model offers opportunities for tenants to collaborate and gain the support of an on-site management team, as well as services such as business hubs, coffee shops and 24-hour security. International property consultancy JLL predicts 30% of all commercial space will be based on flexible leasing by 2030. Its report says the impact of Covid-19 on the need for flexible options will prevail even after the pandemic.
