Shared Office Space Evolves
New shared workspaces continue to pop up all over the world. As noted in a recent Development magazine article, “The Future of Shared Office Space,” “Coworking centers and executive suites facilities that offer shared workspace have become one of the hottest trends among tech startups, freelancers and creative types seeking community and collaboration with like-minded entrepreneurs — or simply workplaces that don’t require a multiyear commitment.”
The trend is no longer limited to those with an entrepreneurial spirit or a need for short-term workspace. Across the U.S., large corporations are renting space in coworking centers, in many cases to enable their employees to rub shoulders with startup founders and techies. According to a recent Bloomberg Business article, “Co-Working Spaces Are Going Corporate,” large companies like KPMG, General Electric, Lennar and Merck have moved employees into coworking centers. KPMG, for example, “rents about 75 desks at a WeWork in Manhattan, which it splits between workers who provide business services to startups, and another team that advises corporate clients on technological innovation.”
Why are these workplaces becoming so popular? A September 2015 Harvard Business Review Article, “Why People Thrive in Coworking Spaces,” offers three reasons. Survey results indicate that people who belong to coworking centers have three characteristics: They see their work as meaningful; they have more job control; and they feel part of a community.
The HBR article also comments on the trend of “enterprise” companies placing employees at coworking centers, noting that operators like Grind, Co-Merge and NextSpace have hosted individuals and teams from companies like Visa, Ricoh and several large financial institutions. Those operators report that the companies are using coworking centers for a variety of reasons: because enabling employees to spend time away from the office can spark new ideas; because it allows workers to make more connections by interacting and building community beyond meetings; and because experiencing how people interact at a coworking center can help companies figure out how to create new types of work environments in their own offices.
WeWork, one of the best known coworking center operators to date, has grown from a single Manhattan location in 2010 into one of the world’s most valuable startups, according to a recent Wall Street Journal article, “WeWork Shoots the Works With Expansion Plans.” It has rapidly become the 800-pound gorilla of the shared workplace world, in part by leasing space to divisions of large corporations as well as to entrepreneurs, startups, freelancers and small businesses. The company is now growing its coworking center network worldwide, with new centers opening this year in Germany, India and Mexico. It is also expanding beyond the shared office realm, into residential space with its “WeLive” upscale dormlike residential spaces and, perhaps, into the hospitality area. (According to the article, WeWork has filed a trademark application for “WeSleep,” “which lists its goods and services as ‘temporary accommodation services for guests seeking a common social experience.’”) Finally, a recent Bloomberg Business article, “WeWork Said in Talks With Lendlease About Global Offices Venture,” reports that WeWork and Australian developer Lendlease Group are discussing forming a global venture to lease offices and living spaces to other companies, which may include both WeWork and WeLive properties.
The pioneering executive suites operator Regus also is expanding worldwide while adapting its business model and facilities to meet the needs of the next generation of both corporate workers and entrepreneurs. In February 2016, Regus opened what it believes is “a groundbreaking technology-driven centre” in Waterloo, Ontario, Canada,” according to a Property Biz Canada article, ”Waterloo Next Step in Regus Expansion.” The 21,000-square foot facility features a mezzanine designed for collaboration, multiple coworking spaces that offer companies room to network and brainstorm in an open environment.
What types of shared workspaces are you seeing in your market? Let us know by posting a message in the comment box below.
Julie D. Stern is Managing Editor, Publications, at NAIOP.