Flexibility doesn’t just mean a shorter lease term. It also includes the option to expand or reduce the space, use a serviced office, sublease part of the space, terminate the contract early, or renegotiate the terms periodically. A well-designed lease agreement should answer the question: What will happen to the office if the company grows, downsizes its team, changes its work model, or needs additional space for just a few months?

Flexible, Tailor-Made Options

Companies can choose from several models that can be combined depending on the scale of their operations or the predictability of their staffing needs. The first of these is a short-term office lease or a membership agreement in a flex office, coworking space, or serviced office. The tenant then has access to a ready-to-use space, typically with furniture, internet, a reception desk, meeting rooms, common areas, and administrative support. This solution works well when testing a new location, during renovations, when expanding into a new market, or when a company does not want to commit to a long-term lease right away.

However, these are not the only options, as flexibility can also be incorporated into a traditional lease agreement. The most common solutions are:

  • space reduction option – the ability to return part of the office space after a specified period, e.g., after 24 or 36 months;
  • break option – the right to terminate a contract early upon fulfillment of the conditions specified in the contract;
  • office sublease – making unused space available to another entity;
  • expansion option – ROFO (Right of First Offer), the right of first refusal to lease an additional unit or floor in the same building;
  • Core + Flex model – a combination of a main office and a branch office with a flexible pool of workstations, rooms, or project modules.

What should be considered when drafting a flexible lease agreement?

A good, flexible lease agreement must balance the interests of the tenant and the landlord. The tenant expects the ability to control costs and respond to business changes. The landlord or property manager, on the other hand, needs predictable income, financial security for the building, and protection of the property’s value. For this reason, flexibility should be precisely defined rather than left to be determined later.

Three areas are particularly important in a draft lease agreement. First, the minimum lease term. If the landlord finances the fit-out or offers incentives, they typically expect a guaranteed lease term. Flexibility may be introduced later, for example, after two or three years. Second, a transparent cost mechanism. The contract should specify what happens to the rent, service charges, incentives, security deposit, guarantee, and fit-out costs in the event of a reduction in space, early termination, or sublease. Third, rules for expansion and reduction: when the tenant may expand or downsize the office, how much advance notice is required to notify the landlord of the decision, and at what rates the changes will be billed.

Is it possible to shorten the lease term without incurring high penalties?

The simplest answer is “yes.” However, this option should be provided for in the contract from the outset. In the case of fixed-term contracts, a change in business needs alone is generally not sufficient grounds for early termination of the lease if the contract does not provide for such a possibility.

If the parties wish to avoid penalties, the most commonly used clause is a break option, which allows them to terminate the contract in the manner specified therein. The parties may link this option to a notice period, the absence of arrears, the repayment of a portion of incentives, or a fee.

Other solutions that can be implemented in advance include:

  • a rolling lease, which is a renewable agreement that, after the initial term, is extended in shorter periods, such as 6- or 12-month terms; this allows the company to terminate the lease at the scheduled time without the risk of penalties associated with a long-term agreement;
  • a partial space reduction clause (contraction option), which allows the tenant to reduce the leased area without having to terminate the lease;
  • subleasing or assignment of the rights and obligations under the lease agreement, provided that the tenant can find a party to assume some or all of the obligations;

What mechanisms can be used to renegotiate lease terms?

Lease renegotiation typically occurs in situations where the lease agreement does not address changes that the tenant needs to make during the term of the lease due to changes in its operational needs. Most often, these involve reducing the amount of space or making changes to the office layout, for which the tenant would like to secure additional funding from the landlord.

Typically, the mechanism used to agree on such changes involves compensating the landlord for the reduced cash flow or the cost of rearranging the office by extending the term of the lease.

Subleasing as a Form of Optimization

Subleasing office space is one of the practical tools for flexibility in a traditional lease agreement. It works particularly well when a company has more space than it actually uses—for example, after switching to a hybrid work model, reorganizing teams, reducing headcount, or relocating some staff to other locations. In such situations, subleasing helps reduce the cost of unused space.

For subleasing an office or sharing office space to be legal and feasible, the agreement should include specific provisions. It is best to specify in the main lease agreement whether the landlord’s consent applies to the entire space, part of the office, entities within the corporate group, or also external companies.

The contract should include, above all:

  • the procedure for obtaining the owner’s consent and the deadline for a response;
  • details regarding the sublessee, the planned business activities, and the area covered by the sublease;
  • valid grounds for refusal, such as reputational risk, excessive strain on the infrastructure, activities that compete with other tenants, or the subtenant’s lack of financial credibility;
  • the primary tenant’s responsibility for rent, damages, building rules, and the subtenant’s conduct;
  • policies regarding access to the building, use of the reception area, meeting rooms, and IT infrastructure, as well as issues related to the GDPR, confidentiality, and occupational safety and health;
  • the ability to share space with affiliated entities, project teams, or joint venture partners;
  • Restrictions regarding branding, signage, and layout changes in the subleased portion of the office.

Technologies that Support Management

Flexible leasing requires constant monitoring of numerous issues. Lease management systems help with this by centralizing data on contracts, indexations, break options, guarantees, security deposits, and notice periods. In a modern business environment, contract management and deadline alert systems are used, as well as Integrated Workplace Management System (IWMS) platforms that combine space management, technical maintenance, reservations, and office efficiency analysis, as well as software that enables the reservation of desks, meeting rooms, and parking spaces. The data aggregated in these applications helps assess whether the current floor space truly aligns with how teams work.

The technology also supports scenario analysis: staying in the current office, reducing office space, subleasing, relocating, or transitioning to a flex office. For larger portfolios, document repositories and AI tools that analyze contract terms, deadlines, termination options, sublease rules, and additional costs are particularly useful.

Savills is also developing solutions in this area. Savills Asset Hub includes, among other things, lease agreement analysis, rent roll, budget execution, and the Tenant Lab module, which provides a 360-degree view of tenants. The features currently under development also address NOI profitability, floor plan layout (i.e., stacking plan), and tools supporting ESG data analysis. It is a comprehensive analytical platform based on Power BI that ensures operational and financial transparency.

Short-term rentals—a response to changing circumstances

Short-term office leases may be more advantageous in times of market uncertainty, as they give tenants greater flexibility to respond to changes. The company is not tied to the space for many years, which reduces the risk of maintaining an office that is too large, ill-suited, or too expensive. This is particularly important when an organization is unsure what its space needs will look like in the coming years.

From the property owner’s perspective, offering this type of arrangement for a portion of the building’s space allows for quicker adaptation of lease terms to current market conditions and can also serve as a tool for attracting companies that do not wish to make long-term commitments but are willing to move into the building for the duration of a specific project. In this model, the landlord also gains the ability to flexibly manage a portion of the space, while allowing key tenants in the building to continue expanding.

However, a short-term lease isn’t always the best solution. Longer-term leases often allow for more favorable rates, a larger budget for fit-out, rent-free periods, or cost stability. Therefore, in practice, the best compromise is often a medium- or long-term lease with flexible terms. This allows the parties to combine the predictability of a longer-term partnership with the ability to respond to market uncertainty.