Friday, 16 October 2026
As Bucharest’s modern office supply becomes increasingly constrained, companies are reconsidering how much space they need, how long they should commit to it and whether traditional leases can accommodate rapidly changing business requirements. Andreas Schlote, owner of Hotspot Workhub, Skyhub and Hotspot Exclusive, believes serviced offices are becoming an important part of corporate real estate strategy, while closer cooperation between operators, developers and landlords could create new opportunities across the market.
In an interview with CIJ.World, Schlote discusses the potential growth of flexible workspace in Bucharest, why maximum occupancy is not necessarily the most profitable operating model, the economics of developing serviced offices, opportunities to revitalise older buildings and how artificial intelligence could influence future office demand.
CIJ.World: Bucharest’s office vacancy is falling while demand for modern space in the best locations is strengthening. Are companies choosing flexible offices because they value flexibility, or because conventional leasing cannot provide the right space and delivery timeframe?
Andreas Schlote: Flexibility today is far more than an additional convenience. It is increasingly becoming an essential part of corporate real estate strategy and, for many companies, an important risk-management tool. The pace of change makes long-term space planning much more difficult than it used to be. Artificial intelligence is already reshaping organisations and workforce requirements, while economic and geopolitical developments can rapidly affect business models and headcount. Companies are finding it increasingly difficult to predict their office requirements three, five or seven years ahead.
This is where the limitations of traditional leasing become more visible. Companies commit to a fixed amount of space for relatively long periods, while their actual requirements may change much faster. A business might need 800 square metres but have to lease 1,000 square metres because that is what a building offers. Serviced offices provide greater adaptability, allowing companies to expand or reduce their footprint without significant upfront investment in fit-out, furniture or infrastructure. Demand is increasingly coming from both directions. Companies want flexibility, but it is also becoming harder to secure suitable modern offices in prime locations at short notice. When all operational costs are considered, serviced offices do not necessarily have to be more expensive than conventional space. They also allow companies to concentrate on their core activities rather than managing property-related responsibilities.
CIJ.World: Flexible workspace represents only slightly more than 2% of Bucharest’s modern office stock. What is preventing the sector from expanding faster, and what market share could it realistically reach over the next five years?
Andreas Schlote: The market has evolved considerably. Flexible workspace was initially associated with coworking, start-ups and smaller companies. Today, larger corporations increasingly use serviced offices for entire teams, individual business units or as part of a broader property strategy. We are no longer talking about a single product aimed primarily at companies requiring fewer than 100 workstations.
Several factors are restricting expansion. Suitable buildings in strong locations are limited, while delivering a professional serviced-office product requires substantial investment in fit-out, technology and furnishings. The relationship between landlords and operators is also still developing. Closer cooperation could reduce risk, create more flexible commercial arrangements and accelerate the introduction of new workspace products. Starting from slightly above 2% today, I believe flexible workspace could reach approximately 5% to 7% of Bucharest’s modern office market over the next five years. However, growth should not be measured only in square metres. The diversity and quality of the product will also matter, particularly as larger international occupiers increasingly consider serviced offices as an alternative to conventional leasing.
CIJ.World: Hotspot has previously reported occupancy approaching 100%, but you have argued that full occupancy can undermine the flexibility customers are paying for. What is the optimal operating model, and what does current demand tell you about opportunities for expansion?
Andreas Schlote: Operating at 100% occupancy can become a problem for a flexible-office provider. If every workplace is occupied, we cannot respond when an existing customer suddenly needs another ten or 20 workplaces. Yet the ability to expand or reduce space is one of the most important characteristics of our business model. Our current occupancy is around 95%, which we consider a healthier level. An operator needs sufficiently high occupancy to achieve profitability, but the objective should be economically optimal occupancy rather than maximum occupancy. Once the break-even threshold has been exceeded, maintaining some available capacity can strengthen the service offering and customer relationships. Empty space is not automatically evidence of insufficient demand; within reasonable limits, it can be an essential part of the product.
Our occupancy levels indicate that substantial demand remains in Bucharest, although not every location or building is equally attractive. When considering expansion, we examine the micro-location, building structure, accessibility, surrounding environment, tenant mix and long-term development prospects. The decision to expand an existing location or open another hub must reflect both current demand and how that particular business environment is likely to develop.
CIJ.World: Bucharest is increasingly becoming a two-tier office market, with competition for modern buildings while older properties struggle to attract occupiers. Could flexible-office operators help reposition existing buildings, or will they compete for the same limited Grade A space?
Andreas Schlote: We do not necessarily need a new building, but we do need a good location and a suitable building structure. Our requirements include sufficient ceiling heights, adaptable layouts and technical infrastructure capable of accommodating changing workplace needs. If these conditions are met, an existing building can be a very attractive opportunity. I see considerable potential for operators to work with owners on revitalisation projects. Introducing a professional serviced-office concept can attract new occupiers, improve the working environment and change how a property is perceived. My experience with building revitalisation in Germany has shown that integrating flexible offices can often be considerably less complicated than converting an office building to an entirely different use.
However, not every older building is suitable. Deep floorplates, inadequate natural light, low ceilings or inflexible structures can make it difficult to create a competitive product, regardless of the address. Where the underlying property is suitable, cooperation between landlords and operators can strengthen asset positioning while providing occupiers with modern workspace. Flexible-office operators will continue to compete for prime buildings, but they can also contribute to the repositioning of selected existing assets.
CIJ.World: With fit-out investment for Hotspot’s next location indicated at more than €600 per square metre and prime office rents increasing, what makes a serviced-office location financially sustainable? At what point do investment costs and occupancy requirements become too high?
Andreas Schlote: A sustainable business model involves much more than charging for workstations. Operators must continuously develop services that provide genuine value to customers, whether through technology, additional facilities, workplace solutions or operational support. These services can also contribute to revenue and improve the overall commercial performance of a location. Every investment decision requires a detailed assessment of rent, fit-out expenditure, achievable pricing, expected occupancy, operating costs, additional service revenue and the long-term prospects of the location. Together, these factors establish an economic range within which the business can operate profitably.
A location becomes unattractive when the occupancy required to break even is too high, the investment recovery period becomes excessive or the prices needed to generate an acceptable return cannot realistically be achieved. High fit-out costs are not necessarily a reason to reject a project, provided the expected operating performance can justify the investment. We also examine different scenarios rather than relying on optimistic assumptions. Market conditions can change quickly, and future demand cannot be predicted with certainty. The important question is not whether a location works under ideal conditions, but whether it remains commercially viable when circumstances become less favourable.
CIJ.World: Should developers and landlords involve flexible-office operators earlier in the design process, particularly when planning new buildings or major refurbishments?
Andreas Schlote: Absolutely. I believe operators should become involved much earlier, ideally while architectural plans are being developed or when an existing building is being assessed for revitalisation. Flexible offices have different requirements from conventional leased space, and these need to be considered before the building design is finalised. We may need offices for two or three people, larger rooms for 20 or 30 employees, meeting facilities and shared areas that can accommodate changing requirements. The structure and technical systems must allow these spaces to be adapted efficiently. Retrofitting flexibility after construction can be considerably more expensive and sometimes physically impossible.
The traditional approach of dividing buildings into fixed office units does not always reflect how companies now operate. One occupier may need a single room, another 100 square metres and another a temporary project area. Developers should therefore consider how buildings can accommodate different workplace models over their lifetime. The larger professional landlords in Bucharest increasingly recognise this change, and I expect cooperation between owners and operators to become much closer.
CIJ.World: How are corporate occupiers changing their requirements, and are serviced offices becoming a long-term solution rather than temporary accommodation?
Andreas Schlote: Hotspot accommodates well-known national and international companies, including major corporate clients, without mentioning any names. . Their requirements vary considerably, but adaptability is increasingly important. Some companies establish a small local team before expanding, while others require space for specific projects or business units without committing to a conventional long-term lease. One of our tenants, for example, developed its presence in the Romanian market from our space, while another initially required just four workstations, with the potential to expand significantly as its business continues to grow. These situations illustrate why companies value the ability to change their accommodation as business requirements evolve.
The market is moving beyond the traditional distinction between coworking for smaller businesses and conventional offices for large corporations. Professional serviced offices can support substantial corporate operations, providing infrastructure, services and workplace quality without requiring occupiers to manage everything themselves. For many companies, this is becoming part of their longer-term property strategy rather than simply a temporary arrangement.
CIJ.World: Artificial intelligence is creating uncertainty about future employment and office requirements. Could AI reduce overall office demand, or will it accelerate the shift towards flexible workspace?
Andreas Schlote: AI will have a significant impact, although nobody can confidently predict the full consequences. We have already seen technology companies restructure their organisations, and administrative and other business functions are likely to experience further changes. It is becoming increasingly difficult for companies to determine how many employees they will need or how much office space they should commit to several years in advance. Some organisations may reduce staffing in certain areas, while others will develop new activities and business models. The important point is that companies may change much faster than buildings and traditional leasing arrangements can accommodate.
Flexibility therefore becomes a way of managing uncertainty. Companies may be reluctant to commit to large, fixed office footprints when their future requirements are unclear. AI could accelerate this trend, but the movement towards more adaptable workplaces was already underway before artificial intelligence became such an important business consideration.
CIJ.World: Hotspot has expanded despite launching shortly before the pandemic. What are your immediate growth plans, and what role will external investors or strategic partners play?
Andreas Schlote: Hotspot was established in 2020, only weeks before the pandemic, which was an extremely difficult time to launch a workplace business. We opened Skyhub in 2023, and the company subsequently underwent restructuring. I took over management, strengthened customer acquisition and reorganised internal processes. In June 2026, I acquired the remaining shares and became the sole owner.
The business is now performing well, and our main challenge is not attracting demand but accommodating all the requirements customers bring to us. Another location is approaching opening, and my objective is to grow to four locations, potentially five. Until now, I have financed the business myself. Faster expansion will require external capital and strategic partners, and we have recently started exploring those opportunities. However, growth must remain commercially disciplined. Each new location must have the right building, market position and operating economics rather than simply increasing the number of centres.
CIJ.World: Looking beyond Bucharest, could Hotspot become an international operator, and what should property investors understand about the future of flexible offices?
Andreas Schlote: Bucharest remains our immediate priority because I believe the market still offers considerable opportunities. Over the longer term, I would like to develop Hotspot into a franchise concept, with Bucharest serving as the centre for expansion into other metropolitan markets. Vienna and Zurich are examples of cities that could be interesting, although any expansion would require the right partners and an operating model adapted to local conditions.
I am also considering opportunities beyond traditional business districts, including satellite offices within residential developments. We have already examined such a concept with a major developer, although we have not yet identified a satisfactory economic model. Providing professional workplaces closer to where people live could become increasingly relevant as mixed-use neighbourhoods develop, but the financial fundamentals must work.
For investors and developers, the most important change is to incorporate adaptability into buildings from the beginning. Corporate requirements will continue to evolve, and AI may accelerate that process. Buildings must be capable of accommodating different occupier sizes, workplace arrangements and services without requiring major structural changes. The office of the future is not simply about providing square metres. It is about giving companies the ability to change.
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