HEWN unveils second Flexible Workspace Returns Index

Flexible workspace consultancy, HEWN, has just dropped the second edition of its Flexible Workspace Returns Index - taking a closer look at how flex is really performing against traditional office rents across London. Despite a more muted year for the wider market, flexible workspace is holding firm and, in many cases, still outperforming.

A market of two halves

“Last year was a tale of two halves,” says HEWN Founder, Will Kinnear. While performance eased in the latter half of 2025 alongside the broader market, the longer-term picture is more telling. Across both one- and five-year timelines, higher-quality flexible workspace continues to outperform traditional rents. At its peak, 5* product reached returns of over 200% of headline rent, even against the backdrop of a more cautious and uncertain CRE market.

Quality is the differentiator

One of the more consistent themes running through the report is the growing divide between product tiers. 5* and 3* space continues to outperform across most London submarkets, while lower-grade 1* product has proven far more volatile - and, in some cases, has struggled to keep pace with conventional office rents altogether. It’s a widening gap that speaks to a more mature market, where product, experience and execution are increasingly driving performance.

West End and City lead the charge

Unsurprisingly, London’s core office markets continue to lead performance across the capital. In the West End, 5* flexible workspace hit its highest desk rates in Q2 2025, generating returns of around 125% of prime headline rents. While this eased slightly later in the year, levels remained ahead of 2024. In the City, the top end of the market recorded its strongest performance in five years, climbing to almost 200% of traditional prime rents before settling closer to 130% by year end.

Canary Wharf and beyond

Canary Wharf also saw particularly strong performance at the top end, with 5* product reaching returns of over 230% of market rents at its peak. Elsewhere, markets such as Midtown and Southbank remained stable overall, although both saw some fluctuation in the second half of the year as supply increased and market conditions shifted.

A shifting role in the landlord playbook

Behind the data is a broader shift in how flexible workspace is being viewed. As Kinnear puts it, it has “become mainstream” - no longer a secondary or experimental offer, but a strategic component of a building’s overall proposition. As landlords continue to rethink how their assets are used — from shared amenity spaces to fully managed workspace - the ability to deliver high-quality, operationally sound flex product is becoming increasingly important.

The takeaway

There’s no doubt flexible workspace has moved beyond disruptor status - and is now firmly part of the established market. But as this year’s index makes clear, performance is far from universal. The gap between well-executed, high-quality product and everything else is widening - and it’s the former that continues to pull ahead.

To dive deeper into these findings, download the full report.