Speaking conventionally, offices are workplaces where employees travel away from their homes to work. But this traditional way of work became life-threatening when the pandemic spread. As the pandemic de-escalates, organizations are introducing hybrid work models for employees to work collaboratively.  

Whether you set offices at different locations, drastically modify your office space, or make slight alterations in existing offices to enable hybrid work culture, a professional lease administration is required at the backend to handle all the leases.

The hybrid office model is the future of corporate

Hybrid offices are becoming a reasonably accepted and cost-effective working model across countries post the pandemic. The switch to a hybrid office model has become inevitable among corporate building occupiers.

Hybrid working models are not easier to manage for companies.  Organizations find it challenging as it involves new modifications and payment handling.

The hybrid model adoption poses several challenges to landlords, tenants, and real estate professionals regarding space management and leases agreement modifications.

A study conducted by CBRE on 42 companies stated that companies had occupied more than 350 million square feet of office space, meeting the specific needs of hybrid office models.

About 60% of companies are trying to redesign their office workplace, and 56% of companies are using flex space to augment office portfolios.

Impact of hybrid office on corporate real estate leases

Although adopting remote working has been in practice since 2020, the hybrid model is at the top of the mind of many companies as they are still figuring out how to utilize office space efficiently.

When shifting from a physical office to an entire hybrid workplace, there is much to consider for commercial tenants or corporate occupiers.

Corporate real estate (CRE) is experiencing a paradigm shift in the case of the workforce as well as the square footage required to accommodate the onsite workplace. Also, one area landlords and tenants should give more importance to is the renewal of lease agreements.

Hybrid work provides employees with a work-life balance by allowing them to work in their preferred environment. However, corporate occupiers are facing the challenge of choosing a suitable office space to meet company needs.

As onsite presence is no longer mandatory, the lease agreements will require revisions to terms, conditions, and occupancy costs. Whether the lease is for a long or short period or as spaces listed in the leasing agreement, the hybrid model will impact office leases.

Short-term leases

Keeping hybrid office models in mind, corporate companies have to sign new office leases considering office space requirements. As the remote working model brings flexibility to employees, the lack of human interaction and collaboration demands occasional in-office meetings for a healthy work environment and productivity.

However, most corporate companies adapt to a hybrid model with the uncertainty of better office solutions to support flexibility. The occupancy level remains low, with a negligible number of employees working from the office.

In such cases, short-term leases could be an alternative for corporate companies to make their monthly investments worthwhile. With proper lease administration services, companies can easily keep track of important dates and compare the existing and prospective leases to figure out which benefits the most financially and practically.

Increasing/Decreasing office space

Another way corporate offices work in a hybrid model is by renting small spaces. The occupancy cost for small offices will be less, and the room will remain full even with 25% of employees working from the office.

On the other hand, some corporate offices are expanding their business presence by renting small office spaces at multiple locations. This real estate strategy helps employees work from offices close to where they live, so they don’t have to relocate.

In such cases, the offices are required to handle multiple leases, which can be challenging. Businesses can either set up an efficient in-house administration team or outsource the administration process to service providers.

Special office requests

Another criterion the offices may consider before renting an office space is the need for extra rooms for fun activities, sanitation, well-lightened workspace, advanced technology solutions, etc., The arrangements will comfort employees and motivate them to work from the office.

Before signing an agreement, it becomes essential for offices to check for all these features required by employees and ensure the leases are compliant. The tenants must ensure the office space can improve employee work productivity.

Real estate strategies for future office models

While the hybrid model poses some challenges for corporate tenants, it also reveals insights into future real estate strategies. Not all strategies work for every organization. Before implementation, tenants must understand and prepare future work plans for their real estate strategy.

Here are some of the real estate strategies that could help your organization to adopt a hybrid workspace model,

  • Incorporate smart office designs which are technology-enabled and centralized to workspace necessities.
  • Explore setting up office spaces at different locations. Whether acquiring small office space involves partnering with co-working space or leasing from other business space, the strategy provides easy access to local offices for the employees.
  • Before renting new office space or expanding your occupancy into another office via partnership, it is better to understand lease accounting guidelines and verify them with professional lease administrators before signing the agreement.

A better understanding of lease accounting may help eliminate overcharges and bring specific lease terms under discussion.

How do lease administration services declutter lease backlogs?

Lease administration is always complicated, and sometimes it becomes difficult for the in-house team to handle thousands of lease documents. If additional support from outsourcing lease administration services can declutter the backlogs, why not get it done?

Setting up the perfect lease administration team will benefit corporate landlords and tenants to focus on other strategic decisions and spend less time on repetitive tasks.

Here are some of the benefits corporate landlords and tenants can obtain from outsourcing lease administration services to professional service providers,

  • Accessing real estate data at times can help you unlock insights into your entire real estate portfolio, enabling a better understanding and proper breakdown of lease costs.
  • Missing critical dates often result in financial consequences. Managing important dates and clauses and keeping track of a team can enable you to make intelligent decisions quickly.

Final Thoughts

The hybrid office model has become a new normal among corporate people. Today, corporate offices are no longer functional and pragmatic. Instead, they are becoming more open and collegial.

If you are one of the corporate tenants who wish to implement a hybrid model workforce, we are here to provide you with lease administration support. Just let us know your requirements, and we will contact you.


Praiselin is an SEO Content Writer. She is a passionate learner with a knack for technology. She's a movie buff and an ardent nature lover who enjoys reading crime novels in her spare time.

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