Co-Working: It Is Not Just for Freelancers and Startups Anymore

Shared office space is not a new idea.  Sole entrepreneurs and remote workers from global businesses have used them for several decades when they needed office space for meetings or the facade of a “real office” when meeting with clients.  Back in the day when working from home was not an accepted norm, shared office space provided an office address and a live person to answer the phone, and a creative, collaborative alternative to working solo.

Co-Working Market Explosion

Fast forward 20 years and shared office space--now known as co-working space--is exploding. According to JLL, flexible space has been growing at an average rate of 23% since 2010. It has emerged as the primary growth driver within the office market and given the massive amount of venture capital being poured into this sector, this aggressive growth rate shows no sign of slowing. In fact, flexible workspace and shared amenity spaces are projected to encompass approximately 30% of the office market by 2030. Source: JLL

Operators are expanding into suburbs and international markets and demand is coming from a broad range of customers from large-block corporate leasing to independent freelancers. Co-working spaces like WeWork, Workbar, and Hera Hub seem to be popping up everywhere, offering flexible shared workspace with a range of amenities, often in the coolest real estate spaces and with a fun social vibe.

Today’s co-working space is quite different from the shared office spaces of decades ago. Spaces are designed to build an engaging community of collaboration and innovation while also supporting the comfort, creativity and focus requirements of the individual.

Tech and Other Big Corporations Jump On Board

And it’s not just startups, freelancers, and random mobile workers inhabiting co-working spaces.  Global corporations are now embracing the model.  No surprise, the tech sector was the early adopter with Google, Twitter, Airbnb, and IBM all leveraging co-working space.   Some large companies are moving whole departments or teams to co-working environments to boost productivity and teamwork.   Many are using the flexible space arrangements to better manage their liquid workforce of project-based, often contractor-staffed teams.

By cohabiting with startups, large firms can stay on top of new ideas, technology innovations, and top talent and discover possible acquisition targets.  Other benefits for companies include a reduction in admin costs, ability to house temporary or contract workers, drop-in options for travelers from other geographical offices, and lower investment and more flexibility than traditional leases.  Furthermore, it can be easier to manage staff who work remotely when they are all in one place. According to CBRE Americas Occupier Survey 2017, 65% of enterprise companies plan to incorporate co-working into their portfolios by 2020. 

Similar to offices across most businesses, co-working spaces offer a variety of different areas including touchdown workstation spots, quiet spaces for private conversations, conference rooms with audiovisual presentation hardware, couches for relaxing, quiet nap rooms and nursing rooms for mothers, kitchens stocked with beverages and snacks, all supported with the latest technology and smart systems for energy efficiency. Some co-working spaces are industry-focused but many host businesses from a range of industry sectors. 

Work and Play

Co-working spaces continue to evolve and some actually promote play with quite unusual features.  In January of this year, Absolute 47 opened uniquely themed spaces that can be used for offsite meetings, training sessions, or wellness retreats.  They have private cubicle type work spaces that are elevated like tree houses and accessed via ladders. There’s a space aimed at car enthusiasts where people can wash their cars and then head to a lounge area.  The company says they offer experiential work spaces that aim to promote productivity and teamwork while giving groups a retreat from their normal 9-5 routine. 

Meaningful Work

Harvard Business Review report, Why people thrive in co-working spaces, tells us that people who use co-working spaces see their work as meaningful.  The report cites reasons such as lack of direct competition and internal politics, a culture of helping each other out, and a movement that aspires to include community, collaboration, learning, and sustainability. 

In addition, a pillar of the co-working mindset is environmentalism because flexible space reduces the waste of half-empty offices and energy spent on commuting. To support sustainability, many co-working spaces have an environmentally-friendly design to reduce their carbon footprint. They use energy saving technologies for heating and lighting, and incorporate water saving measures in kitchens and restrooms.