#WorkBold Podcast Season 3 Episode 4

How much are flex office assets worth now?

A special deep-dive piece by Evelyn Lee at PERE Magazine

PlaceTech cover photo - 2 images

Evelyn Lee, Editor for PEI Media joins Bold Founder, Caleb Parker to discuss her article on how to value office buildings with Space-as-a-Service.

Evelyn just published a research piece on valuing Space-as-a-Service assets in PERE, the Private Real Estate Magazine in PEI's portfolio.

Read article here: https://www.perenews.com/how-to-value-flex-office-investments-covid-19/

Representatives from the valuer community and capital markets have taken a stance on #SpaceAsAService. They expect demand to continue to grow, and properties without a Space-as-a-Service component will be valued less.

In this episode, Evelyn and Caleb dive into the article and her interviews with the experts quoted.

She explains why valuing Space-as-a-Service has been a challenge for commercial real estate, but how this is changing.

We learn why moving from leases to management agreements makes more sense for landlords, and how brand can play a role in driving building valuations.

You’re going to hear about a new investor profile emerging and whether a new asset class is needed for this fast growing segment of commercial real estate.

Connect with Evelyn on LinkedIn

Connect with Caleb on LinkedIn

If you have any questions or feedback on this episode, email podcast@workbold.co

Value Bombs

High Growth Demand for Space-as-as-Service

  • Space-as-a-Service is becoming a hot topic in the capital markets
  • The customer experience delivered by WeWork became a value driver for assets
  • Demand for Space-as-a-Service will continue to increase post Covid
  • Uncertainty is driving the need for flexibility
  • Accounting changes for long-term leases is causing enterprise to rethink their real estate strategy
  • Landlords should incorporate Space-as-a-Service now in their buildings as an important way of future proofing their portfolios because there is an expectation there will be a premium for those types of assets given Customer interest and demand
  • On the flip side, buildings without Space-as-a-Service components will be discounted
  • Space-as-a-Service will drive premiumsRisk mitigation via management agreements
  • We’re going to see a shift in Landlords from leases to management agreements for Space-as-a-Service
  • The lease model was perceived as being more stable and less risky, but in recent times that theory has been proven wrong.
  • It’s less risky for the landlord if they have a profit share or management agreement in place with a Space-as-a-Service operator, because it gives the landlord more control, and a share in the upside.Evolving valuation methodologies
  • The industry needs to evolve valuation methodologies to value income streams from Space-as-a-Service
  • Income streams driven by Space-as-a-Service components should be split out from the NOI of an asset and valued separately, potentially at a premium to how a traditional lease would be valued
  • New valuation methods for Space-as-a-Service should look like hotel industry valuations
  • We’ll potentially see two investor profiles teaming up to acquire assets in the future
    • Low risk profiles to invest in the core asset income stream
    • Higher risk profile to invest in the Space-as-a-Service income stream
  • Layering the right brand on top of an asset can enhance its valuation


  1. Evelyn’s article
  2. Isabelle Scemama, Global Head of AXA IM Alts & CEO of AXA IM - Real Assets
  3. Stephane Theuriau, Partner at BC Partners
  4. Richard Kalvoda, Head of the Advisory Practice for Altus Group
  5. Emma Swinnerton, EMEA Head of Flexible Workspace for Cushman & Wakefield


About Evelyn Lee and PEI Media

Evelyn is Editor at PEI Media, where she’s spent the last decade covering real estate for the private equity community. Originally working out of the company’s NYC HQ, Evelyn moved to London 2 years ago and has been covering the global market.

PEI has a global portfolio of 12 digital financial information and magazine brands that deliver critical market intelligence for professionals in specialist financial markets such as: private equity, real estate, infrastructure, private credit, agriculture and compliance.

They have a diverse team of more than 250 media, information and events specialists worldwide, and hold 50+ events globally to help their customers gain unique insights, make important business connections, and ultimately facilitate better investment decisions.

PEI focuses on the alternative and typically illiquid asset classes that have become essential components of many investors’ allocation strategies globally. They major in private equity, real estate, private debt and infrastructure investing, whilst also engaging with emerging new asset classes.

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