Coworking giants, such as WeWork and IWG’s Spaces, have started to expand their services and lease high profile properties in Auckland’s rapidly growing office market.
Could a possible recession be coming for the coworking industry?
2018 was no doubt a successful year for the coworking space industry, but now, experts are weary about its future.
CBRE’s year-end report showed that coworking increased 200% from 2017 to 2018 with 200 coworking companies operating nationwide.
“The demand for flexibility is very strong and negotiating lease terms — whether it’s directly with a landlord or going through a third party flex-space operator — there’s increasing appetite for that,” said Nicole LaRusso, director of research and analysis at CBRE.
Although coworking seems unstoppable at the moment, there is speculation on how the durable the trend is.
The Latest News
Delivered To Your Inbox
Trading tensions and possible (inevitable) economic downturn could lead the real estate market into risky territory. In this scenario, experts say that tenants leasing flexible spaces could be the first casualties.
LaRusso says that in this case, tenants will most likely look for short-term options, so some may continue to move into coworking spaces and others may give back their space.
“The divergence is likely due to the perceived risk associated with higher concentrations of flex space, as well as the fact that buildings with high flexible space concentrations are much more likely to be Class B buildings,” according to the CBRE report.
Latest on Daily Digest
Sources have revealed that CBRE, the world’s largest commercial real estate services firm, is looking at 3 World Trade Center to house its new coworking brand Hana.
Hoxton Hotel is branching out from traditional hospitality services with the launch of its coworking brand Working From_ at its London Southwark and Chicago locations.
Speaking at the 2019 MIPIM conference, IWG’s CEO Mark Dixon said that companies of various sizes should offer some form of agility in order to attract and retain talent.
As the coworking space sector continues to evolve and grow, experts believe that there will be a 25% growth of these offices within retail properties through 2023.
Ryan Simonetti, CEO of Convene, believes that the firm sets itself apart from the competition by going beyond serviced workspaces and offering more hospitable amenities.
Building Industry Gathering Oakland has opened its 3,650 square foot, one-of-a-kind coworking space geared towards small minority and women-owned businesses in the area.
Novel Coworking’s newest Chicago location will include workspaces, such as office suites, private offices, and coworking space, to accommodate various-sized companies.
As the gig economy continues to become more prominent amongst younger professionals, the demand for flexible coworking spaces from this generation rampantly grows.
Hospitality company Accor is working to expand its coworking services to 1,200 of its hospitality locations, which could make it the largest coworking provider in Europe.
Brexit has left the London office market in development limbo, but thanks to the surprising resilience of the market, builders are moving steadily forward with projects.