The growth of co-working office spaces and flexible workplaces is explosive worldwide.
In a recent article in CoreNet’s March 2018 issue of “Leader” magazine, the author reports that co-working has grown by 200% in three years and 100% in the last two years. The article goes on to report that co-working has evolved from just five centers in 2005 to more than 13,500 globally this year.
Why flexible & co-working office spaces are growing
Behind this explosive growth are the key drivers of co-working offices and flexible workplaces.
Reduced cost and immediate access
Perhaps the most compelling driver is the elimination of up front capital costs for office renovation, as well as protracted fit-out time.
Co-working office spaces can be accessed almost immediately. And thus offer maximum flexibility. The Corenet article reports that co-working and flexible offices essentially offer a new model of office leasing: Workplace as a Service or (WAAS).
The shared office operator assumes all the responsibilities for office leasing, fit-out, and furnishing; so the users are able to avoid these tasks and costs. Certainly a side benefit of this fact is a reduction of workload for the Corporate Real Estate staff, further reducing costs.
Contract flexibility
Another key driver is the flexibility afforded by co-working office spaces. Users can opt for both short and long range contracts allowing for a wide range of occupancy arrangements.
Better support for mobility & collaboration
Another driver of the co-working arrangement is the alignment this style of workplace has with preferred workstyles. Today’s workforce is more collaborative and mobile than earlier generations of workers.
The old model of one employee, one seat, has shifted to a multiplicity of work settings including collaborative spaces, individual work stations, group settings, and social areas. The employee or independent entrepreneur can choose a variety of space options allowing for heads-down or group work.
More satisfied workers
Perhaps the most compelling benefit of co-working is an individual sense of fulfillment.
In a recent Harvard Review article the author delved into the question of what accounts for a significant sense of “thriving” with individuals who participate in a co-working environment. The article cites the “Co-Working Manifesto”, signed by over 1700 co-working participants in 2012. Here are the key principles of the Manifesto:
- collaboration over competition
- community over agendas
- participation over observation
- doing over saying
- friendship over formality
- boldness over assurance
- learning over expertise
- people over personalities
- “value ecosystem” over “value chain”
In essence the Harvard Review article concluded that co-working resulted in more satisfied users primarily because of a sense of meaning and purpose in their work experience.
Could co-working office spaces work for you?
Initially co-working attracted the individual worker. But today co-working attracts a full range of tenant sizes including large corporate tenants like IBM and Amazon, as well as medium to small user groups.
The market for co-working office spaces is now segmenting into different versions. There are women only co-working office spaces such as “The Wing” in New York City and Washington, DC. And men-only co-working office spaces in Brooklyn, New York and Sydney, Australia. WeWork has branched out with WeLive, co-living spaces, and We Grow, an educational offering from WeWork.
Beyond co-working office spaces: co-living spaces
One interesting trend associated with co-working is the emergence of co-living spaces. In London, the world’s largest co-living community opened its doors to 550 residents. While residents have their own units with bedroom, bathroom and kitchenette, the project offers all-inclusive rent with access to a restaurant, co-working spaces, Wifi, gym, cinema, spa, larger kitchens and dining rooms.
Co-working here to stay
The CoreNet article reports that large landlords in New York and London now view flexible space, such as co-working office spaces, as a key part of their portfolios, more than 67% of landlords surveyed reported this adoption.
Co-working is becoming a major trend in workplace arrangements. It combines significant economic benefits with increased individual user satisfaction. The fact that WeWork, a major player in the co-working market was recently valued at $5 Billion gives a sense that the co-working phenomenon is no longer a passing fad, but a major shift in the office market worldwide.
More topics about corporate office space trends:
Are US Companies Using Too Much Real Estate?
Real Estate Market Analysis: A Primer for CRE Executives
