Nearly 200 coworking space operators, community managers, industry consultants, real estate professionals and vendors gathered in Melbourne for two days of tours, expert panels, open forums and happy hours at the Global Coworking Unconference (GCUC AU) on August 24-25.

Conference response was positive and enthusiastic from veterans and newbies alike who came from cities and rural locations in all seven states in Australia, and as far afield as Perth, New Zealand and Tasmania to learn business strategies, share challenges, discover trends, gather information and hoist a pint or two of Juicy Beer.

In the process, ideas and solutions were exchanged, new connections were made, friendships forged and support groups established consistent with the collaborative spirit that is the heart and soul of coworking.

Eye-opening to all

“I thought I knew all about coworking and all the spaces in Australia. I was wrong,” reported Simone Eyles, founder, Working Spaces HQ and director at 365cups.com. “GCUC exposed me to how big coworking is and how much bigger it can be. I learned about the impact coworking can have on economic development. It’s not just techies and startups. It’s an opportunity for all pockets of business to start and grow.”

“Being relatively new to the industry (as most people are) I welcomed the opportunity to spend a day away from refilling the coffee machine and printer paper to learn more about industry trends, gain new ideas to improve our space, and of course network with others doing similar types of work,” commented Elise Leterman, community development manager at deskworx.

Key takeaways:

The coworking community Down Under is as vibrant, professional and generous as it is in the U.S. “The energy, vibe and ‘collaborativeness’ is global,” reported Steve Golding, founder, Meeting Hub. “The consensus from those who attended NY and LA was that the same level of professionalism exists globally within this industry. It’s the same exceptional ‘Can do,’ ‘Will do,’ ‘How do I help?’, ‘How do I share my experience?’”
Coworking spaces are increasing productivity. This is largely due to some of the extra touches that coworking space operators and managers add to the experience such as free food and opportunities for social interaction. These encourage people to enjoy their work environment and therefore increase their productivity.
The coworking industry is becoming more corporate. It is no longer a movement just for freelancers and digital nomads but a new way of working that is being embraced by corporate companies.This model will continue to expand with companies seeking to retain their talent by understanding the importance of maintaining a flexible and innovative work environment.

Additionally, commercial landlords are going to need to understand the benefits that coworking spaces can bring to their buildings and learn to embrace the flexibility and adaptability that comes with that.

Local coworking operators will need to be more innovative and think more creatively about bringing in new streams of income to remain viable as international companies enter the market and increase competition. One suggestion was to develop strategic relationships with other coworking spaces to strengthen the overall ecosystem and presence of local businesses.

Carl Sullivan, Your Desk, provided ideas and strategies to generate leads and revenue, including offering an iPad sign in for WiFi to convert random visitors into champions and members of the space, providing secretarial services and hosting events and to engage the local community.

Coworking’s cooperative focus differentiates it from the business center community. “If I was to use a term that defines GCUC I think it would be supportive and safe,” offered Golding, in contrast to the property-focused business center community. ”You just wouldn’t get the same degree of collaboration, openness and desire to help each other that you do in coworking.”

“Even coworking spaces located one block from each other are willing to share what works and what doesn’t. You don’t get that in business centers,” he added.

“Collobrotetion” is part of coworking,” asserted GCUC executive producer Liz Elam. “We are competitors, but we can collaborate.”

Coworking operators are laser-focused on their target customer. A tour of local Melbourne coworking spaces provided real-life examples.

“Every space was unique in catering to a different market (B2B, creative, private offices etc.),” reported Amy Green, marketing manager, Hub Australia.

“I was very impressed with the diversity in Melbourne. A central theme was spaces which curated community via design, providing multiple areas for members to meet and gather for networking and events.”

“We visited Teamsquare; Space & Co, owned by The GPT Group, Australia’s oldest Real Estate Investment Trust and their first foray into coworking; Hub Southern Cross, currently the largest space in Melbourne with a good mix of startups and corporates; York Butter Factory, whose members are all Tech B2B; Collective Campus, former coworking space now primarily education and innovation consultancy but with notable tech start-up alumni; and Collins Street Business Centre.”

“It was really evident that every space is different, but each operator has a really clear idea of their customer,” added Golding.

Housed in a unique stone building, York Butter Factory was a particular standout, according to Golding. It offers a strategic partnership for its community via member partners ANZ Bank, Ernst & Young and Salesforce, providing access to venture fund capital and mentoring.

The coworking industry in Australia is still in its infancy compared with other markets in Asia and North America. In Australia, only 0.6% of commercial real estate is currently coworking spaces where other markets have up to 4%, attendees learned at a session led by John Preece and Kimberley Paterson of Knight Frank Commercial Real Estate.

The pair shared research showing coworking in Australia growing steadily. Coworking space across Australia has grown by 62% over the past year, according to Knight Frank’s latest report, Culture Clash: Flexible Workspace, Coworking and the Future.

“Sydney has enjoyed the highest growth in terms of amount of space growing by 65% while Melbourne grew by 63% over the 2017 year. However, Melbourne has the highest volume of coworking spaces across Australia with nearly 50% of the total volume of coworking sites across Australia, followed by Sydney with 38%,” shared Amy Green, Marketing Manager, Hub Australia.

“The angle here was growth opportunities,” added Golding. “The question was: Do we think we’re in a growing and emerging market? Yes. And when you look to more mature and established markets like London and New York, where coworking as a percentage of total office space represents 4.3 or 4.5%, versus 0.3% in Sydney and Melbourne, the opportunity is enormous. By no means are we even close to scratching the surface.”

Millennials drive the trends in how people work. Knight Frank’s Associate Director of Research, Kimberley Paterson, said that with millennials set to flood workplaces over the next five years, the coworking trend is expected to continue to gain momentum. She said that the amount of coworking spaces has soared by almost 300% since 2013 with this industry now occupying 193,192sqm across six capital cities, equivalent to 0.6% of total office stock.

John Preece, head of occupier solutions at Knight Frank, said “To be competitive, coworking operators need to provide high quality spaces, exceptional service and ever-developing amenities.”

Generation Z is set to disrupt the office experience. Beginning in 2017, Generation Z will enter the workforce, creating wide-ranging impact. Oft-referred to as digital natives, they will be the first generation into the workplace that has never lived without technology.

“When you think about the language and ways people are going to access and interact with those services, the whole ballgame is about to change,” noted Golding. “They’re going to want a very, very different customer experience. They want access to services immediately on demand. Sometimes without interacting with the person.

“I think that’s going to be a challenge. The spaces that adapt and shift with that customer will flourish. Those that don’t may fall by the wayside.”

Suburban and regional (rural) coworking is different but similar. Regional operators face many of the same challenges of operators in larger cities: “How can I make my space stand out? How do I build my community?” recalled Golding. On the other hand, city-based operators may focus on yield and rate per square foot whereas regional operators are challenged with “How do I entice people to come away from the cities?” “How do I encourage people to come and work locally?”

A coterie of operators from regional locations – some who travelled four to five hours by plane to attend – connected at the event and met over dinner to form their own support networks to continue the community and idea exchange. “We’ve made sort of a think tank where we can jointly resolve or overcome those challenges,” reported Eyles. “Now there’s a private Facebook group, Slack channel and planned meetups.”

A regional coworking space is an asset for the whole community. Coworking spaces can play a part in local communities, beyond just business, but it often requires bridging the education gap and tapping government engagement.

“You need to let the local business community and chamber know about coworking,” Eyles shared. “It’s more than bums on seats. It’s creating opportunities for collisions, for business people to connect and grow and support each other.

“One suggestion to ignite innovation in the community was having activities in the space for everyone: school kids, local businesses, etc.,” Eyles added.

Differentiate by design is key. Brad Krauskopf, CEO and Founder of Hub Australia said, “Key to this is the way in which we design a coworking space. Providing a diversity of spaces, including areas for quiet, active and social activity, allows members to choose where they wish to work in that particular timeframe and in turn actively manage their mental health,” said Krauskopf, whose Hub spaces include nap rooms.
Create consistent branding and identity from the beginning. Hollie Arnett, Creative Director at CoLo, shared, “From day one, consider your colours, fonts and imagery; creating a brand guideline will ensure your space remains consistent and can scale accordingly.”
A focus on wellbeing should extend to staff and will aid with recruitment and retention. CoLo founder Nick Shewring spoke on the recruitment challenges in the industry. Due to demands and pressures, burnout often happens in just a year or two. Inspire 9 (Melbourne) founder Conrad Tracey mentioned retaining staff is about providing initiatives which are more than money.

Among suggested strategies to find, attract and retain great staff:

Paying 10 – 15% more than market rate.
Professional development.
Coworking from a tropical island (Bali).
Look outside the coworking industry to industries where complementary skills are used, such as hospitality.
Establish a staff rotation from the front to back of house, allowing staff to get angry at the customers, but only in the back of house.

“Trying to constantly build and maintain this vibrancy is incredibly draining. It’s important that people acknowledge the key part that all their staff play in creating that exceptional experience and spirit,” Golding added.

“These people are not just managing and running spaces. Sometimes they’re a confidant. Sometimes they’re providing counseling and advice. They could be a business coach today and tomorrow they could be cleaning fur balls out of the printer. They are multifaceted, incredibly talented individuals who need to be nurtured in the same way the community does.”

Coworking is providing [human] connection when people are so connected to their devices. Coworking can create an environment which truly embraces the whole person through developing strong relationships with each coworker in the space and acting as a resource for people to bounce ideas off and listen when needed, Elam shared with the audience.
It’s not just real estate. It’s about people. Coworking spaces are uniquely positioned to provide a sense of community, attendees learned at a Next Level Community Building Panel Discussion with Nick Shewring. “Activities (in coworking spaces) provide a sense of identity as a member of a particular coworking community, which compares with the rather transactional experience of a serviced office where people might know other users much in the same way as regular travellers meet each other in the same hotel or airport lounge”, according to a report by Tim Malburg, Sydney University – More from his report here.

“I think Nick Shewring summed it up most effectively when he shared, ‘We spend 100,000 hours working… wouldn’t it be nice if we spent it doing things we like, with people that we enjoy being with?’” expressed Loterman.

“The biggest takeaway is that coworking has begun and continues to change the way that people work which leads to a fundamental change in that way that people live. Wouldn’t you want to be part of a movement that helps people lead happier and more balanced lives?” Loterman observed.