How Coworking Continues to Evolve


Dan Park

Now that coworking is no longer considered a fad, it’s quickly moving beyond the quaint notion that it’s meant only for entrepreneurs and startups.

As of 2019, coworking spaces makes up 5 percent of U.S. office space and it’s expected to consume at least 30 percent of space within the next 11 years, according to a recent study by JLL.

More than 1.1 million people worked at 13,800 coworking spaces around the world, according to a recent Global Coworking survey. And with giants like Google and Microsoft embracing the coworking model, smaller and medium-sized companies are giving strong consideration to the economic advantages of coworking spaces.

How Coworking Continues to Evolve people working 300x200

Here’s a bit of trivia: if one company owned all the coworking spaces on the planet, it would have more international locations than Walmart, according to Tweak Your Biz.

Here are some of the more recent coworking trends we’re finding:

Coworking is becoming more refined and defined.

The JLL study reveals the top coworking markets still exist in major cities like New York, San Francisco, Silicon Valley, Austin and Boston. However, each market shows different reasons for the growth. New York is influenced by population and entrepreneurs, while San Francisco benefits from the tech industry (and, of course, population density as well). Silicon Valley may not have the population density going for it, but the tech-industry presence and venture capital availability is a major coworking growth component.

As a result, the direction now is to evolve toward “more scalable models of creating coworking communities, and toward a wider range of services offered to clients,” according to globalworkspace.com.

How Coworking Continues to Evolve 500 w madison spec suite 2 300x200

This market-related growth moves coworking into more specific categories and niches; it’s no longer one-size fits all. Think women’s only spaces, writer’s spaces, medical and bio spaces, commercial kitchens and more. Coworking owners and operators must know the exact population and market they are serving, and why entrepreneurs and startups are looking for space in a distinct market.

Coworking spaces will expand.

During its humble beginnings over a decade ago, coworking spaces often did not exceed 20,000 square feet. Today, it’s not unusual for coworking spaces to offer over 100,000 square feet, according to HSP Real Estate Group. The expansion is attracting larger players like Verizon, Toyota and IBM, which is successfully using coworking space for outsourced, temporary leasing situations.

Expansion, and a need for bigger coworking spaces, is becoming a given. On average, every coworking space is planning to expand their area by 70 percent, according to the Deskmag 2018 Global Coworking Survey. Of those surveyed, 86 percent anticipate more members.

Large corporations are incorporating coworking into their model.

Big companies are finding that the collaborative environment is helping to motivate staff and encourage creativity, reports The New Republic.

Forbes reports that large organizations can use coworking spaces to recruit talent, due to its close proximity to the hive of creative/tech teams and individuals.

Leasing coworking space gives larger companies a chance to expand into a new market without long-term commitment, making a temporary headquarters of the coworking space.

Coworking may be going even greener.

The very idea of coworking is environmentally friendly. Companies and entrepreneurs sharing workspace, supplies, amenities and infrastructure helps cut down on wasted energy and makes for a more sustainable environment. Medium reports that coworking spaces may be taking green to the next level by promoting more efficient ways to dispose of waste and introducing initiatives like “bike to work” to reduce congestion and pollution.

How Coworking Continues to Evolve Busy coworking space iStock  300x169

As the coworking market matures, its pace slows.

According to Collier’s 2019 Flexible Workspace white paper, the number of coworking spaces climbed 16 percent in the U.S. and 36 percent outside the U.S. However, Colliers predicts the number of future coworking spaces to grow annually at 6 percent in the U.S. and 13 percent elsewhere between 2018 and 2022.

According to Emergent Research, there will be 21,306 coworking spaces worldwide by the end of 2019. The field is expected to grow almost 43 percent between this year and 2022. In other words, this trend is showing no signs of slowing.

By 2022, there will be over one million coworking members in the U.S. alone. By 2020, 40 percent of coworking members will be freelancers, independent contractors and part-time workers. A survey conducted in 2017 shows 44 percent of coworking members are women. It can be expected that as of 2019 roughly half of the coworking industry will be female. As a result, a growing trend to serve the niche: women-only coworking spacesMajor corporations like Microsoft and Deutsch Bank continue to make at least a partial transition to coworking spaces.

Ultimately, the acid test of the best coworking space is not location, but community. The most successful spaces are defined by their ability to build a niche audience of members who enjoy working together, specifically if the space is industry specific. According to Coworking Resources, “rather than focusing on competition, building a tight-knit community is probably a better focus for your energy.”

 

How Coworking Continues to Evolve dan park website 02 225x300
Dan Park is a senior vice president and asset manager for KBS overseeing more than 3.3 million square feet of U.S. office space .