Like most markets worldwide, the UK’s office space sector is still evolving rapidly, driven by COVID’s impact and the rise of AI.
As businesses rethink their workspace strategies in response to rising costs, AI-driven efficiencies, and hybrid work models, the old assumptions about office space no longer hold.
The World Economic Forum’s Future of Jobs Report 2025 highlights blanket digital access, automation, and general economic uncertainty (especially around the cost of living and staggering economies) as key forces shaping the future of work. These forces are already reshaping workspace demand in London, and across the UK.
Businesses are moving away from rigid office leases and are embracing new models of flexible space that better align with their workforce. For those that fail to adapt, the risks are growing as margins of error will hurt ROI in a tough trading climate. Workspace inefficiency is now a serious cost to business performance, no matter your company size.
How AI and automation are redefining office demand
The World Economic Forum identifies AI and tech as the single most transformative factor in business strategy changes over the next five years, with 86% of companies expecting technology of all kinds to impact operations by 2030. Which makes you wonder what the other 14% are thinking!
But we digress, in the office sector, this is already driving a shift towards:
- AI-powered workspaces and analytics – Businesses are using predictive modelling and real-time occupancy data to right-size their office requirements, reducing unnecessary space and cutting costs.
- AI and machine learning reducing office headcount needs – As automation replaces some back-office (especially administrative) functions, businesses are reconfiguring office layouts for collaboration rather than desk-based work
- A move towards high-quality, high-impact spaces – with hybrid here to stay, fewer staff are in the office full-time. Savvy businesses are prioritising ‘experience-led’ environments that attract talent and improve productivity.
Rising costs are forcing a smarter approach to office Space
According to the WEF’s report, the rising cost of living is now the second most influential factor shaping business transformation, with 50% of employers expecting it to significantly impact their organisations.
For office space, this translates into:
- An increased focus on cost efficiency – companies are cutting unnecessary workspace expenditure and prioritising better financial planning
- A shift away from underutilised space – used by a growing number of bigger businesses, most AI and occupancy tracking reveal that most traditional office setups are deeply inefficient, prompting businesses to rethink approaches
- More flexible, on-demand workspace models – long-term leases are becoming a liability rather than an asset, as businesses favour agile solutions that scale with business growth
The ‘Green Transition’ and sustainable office strategy
The green transition is now a priority for 47% of global businesses, with companies accelerating the push to reduce carbon footprints and increase efficiency. In the UK office market, this is driving demand for:
- Low-carbon workspaces – with ESG targets tightening, businesses are actively seeking energy-efficient office buildings that reduce operational costs.
- Smarter building technology – AI-driven climate control, motion-sensing lighting, and automated building management systems are becoming non-negotiable features.
- Reducing excess office space as a sustainability measure – Many companies are cutting their real estate footprint not just for cost reasons but to minimise unnecessary emissions.
The future of office design: flexibility and high performance
In a controversial book, Philip Ross, co-author of Unworking: The Reinvention of the Modern Office, argues that businesses must unlearn a century of traditional office thinking. Instead of defaulting to static, underused, old-school office space, he sees the rise of:
- Activity-based workspaces – offices designed around function and collaboration, rather than simply housing desks and chairs
- A data-driven approach to office usage – smart companies are now measuring real-time occupancy and performance metrics, rather than assuming fixed requirement, and flexing their contracts
- Techy-driven workplace strategy – AI-driven systems are now becoming central to office planning and workforce management. This will accelerate ahead.
2025: a defining year for workspace strategy
With technology changes, cost pressures, and pressure on sustainability reshaping the office market, the companies that succeed in 2025 and into 2030 will inevitably be those that:
- Use data and AI to optimise workspace decisions
- Invest in workspaces that drive productivity, not just occupancy
- Adopt flexible office models that adapt to business needs
- Prioritise energy efficiency and long-term cost control
At ADAPT, we help businesses secure high-value, flexible workspace solutions that align with modern needs. Whether it’s finding off-market deals, negotiating better workspace terms, or rethinking office strategies entirely, our expertise ensures businesses can stay in touch with us to stay ahead in a changing market.
Need to rethink your workspace? Get in touch with ADAPT to explore smarter, better-value workspace solutions.
