Flexible Workspace Operators Shift to Partnership Model as Office Market Changes

Written by:

Steve Marcinuk

Date:

14 Nov 2025

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The flexible workspace sector is experiencing a significant shift as operators move away from traditional lease-based models and adopt deeper partnerships with property owners. This change reflects evolving attitudes among landlords and tenants regarding office space amid ongoing market uncertainty.

Alexander Passler, co-founder and CEO of Vallist, has observed this shift throughout his three-decade career in flexible workspace. Beginning with Regus in Europe in the 1990s, Passler later expanded Compass Offices across Asia and then joined WeWork to lead international expansion. His experience launching over 120 buildings in quick succession, followed by later portfolio adjustments, shaped his understanding of what drives success in flexible workspace operations.

“One of the most important things I learned over the journey is really understanding each market you go into extremely well,” Passler says. “There is no one size fits all in the flexible workspace sector. Every country or market has different cultural differences and work habits, and therefore the way they plan their workplace strategy is different.”

A New Model for Landlord Partnerships

Founded in 2021, Vallist operates using what Passler describes as a “white label model,” distinct from most traditional flexible workspace operators. Rather than signing leases and running branded spaces, Vallist forms direct management agreements with landlords.

“We consider ourselves like a team of professionals in this industry which is seconded to the landlord or to the property owner to run their flex space, versus us coming in and running our own business in their building,” Passler says.

This model allows for customization that aligns with each building’s tenant base and leasing strategy. For buildings serving the financial sector, Vallist creates formal environments with enhanced cybersecurity and privacy features. The design, technology infrastructure, and hospitality services are tailored to support the landlord’s overall market positioning.

“We design the space within an office building that really is aligned with the overall leasing strategy,” Passler says. “Everything from cybersecurity to network connections, sound installation, and privacy factors is designed and catered for the tenant mix in that building.”

Responding to Market Challenges

Vallist’s approach addresses several challenges in the current office market. For landlords struggling with occupancy, Vallist can fill buildings faster than traditional leasing processes and achieve higher rates. The management agreement structure also provides flexibility that standard leases lack.

“We will fill a building a lot quicker than a landlord will on his own,” Passler notes. “The decision and time it takes to sign up a client for us is a matter of weeks, whereas for a landlord, it’s a long process to sign up a tenant and then wait another six months for the fit-out to be completed.”

Financially, Vallist typically achieves a 30-40% uplift over standard office rents, operating on 10-year management agreements that include monthly fees and profit sharing.

Vallist has also developed solutions for large corporate tenants with excess space, a common issue in the post-pandemic office market. The company can monetize unused portions of corporate space by creating flexible workspace offerings for external tenants.

“You have large occupiers today—take a bank, for example—that have 200,000 square feet in a big office tower signed pre-COVID, and now post-COVID, half of their workforce is working remotely,” Passler explains. “We can design and develop a product in their space which they are not using, to market it to external parties.”

If the corporate tenant later needs space back due to changing policies, Vallist can adjust their footprint since they are not locked into traditional leases.

Technology Builds Trust and Transparency

A key component of Vallist’s partnership model is its technology platform, which gives landlords real-time visibility into operations and performance. This transparency addresses a longstanding barrier to management agreement structures.

“Our landlord partners have live reporting and live visibility into everything we do,” Passler says. “They get a huge amount of data from our business, how companies use space, what they’re using, and how frequently they’re using it. They literally have a live dashboard of everything we do.”

This level of transparency helps overcome traditional trust issues associated with management agreements, making the model more appealing to property owners who want oversight without taking on operational responsibilities.

Changing Market Expectations

Passler sees flexible workspace becoming a standard feature in office buildings, rather than a separate asset class. He predicts that within two to three years, the line between traditional leasing and flexible workspace will become much less distinct.

“I honestly believe that you’ll be able to lease full floors and do your own fit-outs, lease fitted-out floors, and lease fitted-out spaces,” Passler says. “The terms will vary from 10-year leases down to month-to-month.”

This trend is driven by companies seeking flexibility, hesitance to invest heavily in fit-outs amid uncertain future needs, and landlords recognizing that flexible workspace is now a necessary amenity in competitive markets.

“Nowadays, it’s tough for a large building in a city CBD not to be able to offer this type of work environment,” Passler observes. “Landlords are either doing it themselves or partnering closer with operators than they have in the past.”

Strategic Expansion and Market Focus

Vallist currently operates mainly in the Middle East and UK, with a deliberate approach to geographic expansion. The company’s recent London launch followed 18 months of market research and partner selection before opening its first 38,000-square-foot facility.

“We spent a year and a half in London selecting not only the building but the right partner before launching this first building,” Passler says. “Getting the partner right is as important, if not more important, than getting the building right.”

This careful approach reflects lessons learned from earlier rapid expansion strategies that prioritized speed over local market understanding. Vallist now focuses on building critical mass in each market before moving to new locations, with Miami identified as a priority for upcoming US expansion.

An Evolving Industry Model

Vallist’s partnership-driven approach marks a shift in the flexible workspace sector, moving away from the rapid expansion and contraction cycles of earlier operators. By prioritizing collaboration with property owners, Vallist aims for more sustainable and mutually beneficial relationships.

This model is designed to align the interests of operators, landlords, and tenants as office markets adapt to post-pandemic realities. Flexible workspace is increasingly seen as a core component of office buildings, supporting the need for agility and diverse occupancy solutions.

With its focus on tailored solutions, operational transparency, and strategic growth, Vallist reflects the broader evolution of the flexible workspace industry. As companies and landlords continue to adapt, partnership-based models are likely to play a central role in shaping the future of office space.