Office Giant Offers Hourly Rents as Spain Adjusts to Pandemic

Merlin Properties will offer customers the chance to rent office space by the hour as it bets tenants will seek greater flexibility in their working arrangements as a result of the coronavirus pandemic.

Spain’s biggest property firm will also start offering hourly rates to hire meeting rooms. Under the new services being offered, startups that have retreated from co-working offices due to the crisis will also be able to retain a legal address and a virtual secretary to field phone calls in return for a fee.

Merlin is offering more nimble rental conditions as the pandemic clouds the economic future for some tenants and imposes new demands such as the need to comply with social distancing protocols. The company expects clients will continue to rent about four-fifths of their space through fixed, long-term contracts and the rest through flexible arrangements.

The pandemic has raised speculation that landlords will suffer as more companies become accustomed to their employees working from home. But Merlin believes that companies will also need more space to ensure compliance with social distancing requirements, said Fernando Ramirez, head of investor relations at Merlin.

“There are going to be less square meters because of working from home but on the other hand more square meters because of social distancing,” Ramirez said.

Under Merlin’s new product, known as “Loom Passport,” tenants will purchase credits, which can be used in any of its nine co-working offices in Madrid and Barcelona. Loom, Merlin’s co-working franchise, had previously previously rented out space by the month.

Many of Merlin’s customers were already seeing demand from younger employees for a more flexible working environment, said Ramirez. Companies want to offer their staff a workspace option that combines the facilities of an office with the convenience of working closer to home, he said.

©2020 Bloomberg L.P.

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