Corporate Big Guns Blast Into the Coworking Sector

Central Working

It’s an exciting time for operators of flexible workspace.

There’s a growing pile of research that suggests businesses of all sizes – including large corporates – are turning their back on traditional office leases in favour of serviced offices and coworking spaces.

Take London, for instance. This article, released today on Property Week, claims that corporates are now “abandoning old geographies” and moving into alternative locations in search of larger, more flexible spaces, which is resulting in a “continued upsurge in the serviced office sector.”

This mainstream approach is good news for operators of serviced office space. And given the need for more agile, digital-nomad-savvy spaces, operators of collaborative and coworking spaces are set to benefit too.

But with this intense interest in flexible workspace comes new forms of competition.

Property giants moving into flexible workspace

Among them, we’re noticing a number of traditional big guns moving into the flexible workspace arena. Take JLL, for instance. Just this week we posted news of HiRise, a new online marketplace that focuses on the workspace needs of small businesses – namely, flexible requirements of less than 5,000 sq ft. To say this is a new direction for the commercial property giant is an understatement.

Now, another property behemoth in the form of British Land is entering the fold.

Central Working, which operators coworking spaces across the UK, has partnered with British Land to launch a coworking space on Liverpool Street under a 10-year agreement. ‘Central Working City’ is set to open this year with a mix of shared workspace, serviced offices and meeting rooms.

In this particular case, British Land identified the opportunity based on a “rapidly changing” occupier profile in this part of London, citing the migration of technology and creative businesses driving demand for coworking spaces in the area.

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Seismic shift

JLL serving startups and British Land offering coworking? It’s easy to spot a seismic shift in the way traditional property giants are operating.

It’s also clear that the demand for flexible workspaces is rising sharply. So much so that it’s emanating beyond the workspace industry – and even banks are getting in on the action. Last July saw the announcement that RBS, a major financial institution in the UK and Ireland, was partnering with DeskUnion to launch a new coworking space in one of its Edinburgh-based banks.

Several months on, and given the immense popularity of the space, it seems this industry first is unlikely to be the last.

What we can see from these trends is that the big guns – both inside the property market and out – are spotting huge opportunities in the flexible workspace industry and are moving into position. While this certainly triggers a need for business centre operators to sharpen their competitive edge, it also proposes significant collaborative opportunities. The chance to work with a big-name organisation such as British Land, or even RBS, could be a major boon for your brand.

Regardless, with competition intensifying amid a steady stream of new and unlikely market entrants, now’s the time to fire up your own cannons.

Image – Central Working