Major office space provider IWG has started adopting the franchisor model, pioneered by fast-food company McDonald’s, in its effort to edge further away from WeWork.
The future of the coworking market
Atlanta’s coworking footprint is at about 0.8 million square feet in a market of 144.4 million, but it is rapidly growing at 80.2%.
Eric Messer, senior researcher at Newman Knight Frank (NKF) says that with all the new construction taking place, he sees a continued growth of office space this year.
Messer was apart of the study “The Future of Coworking and Flexible Office Space: Five Potential Paths” that found coworking operator Regus being Atlanta’s largest coworking operator, taking 45% of the market.
The national study also found that coworking and flexible offices have doubled their inventory, with coworking occupying 49.7 million square feet in large U.S. metro areas.
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The study explores five likely outcomes for the national market as a whole, including: coworking will accelerate, reaching 20% of inventory by 2023; coworking will continue at its pace, but will consolidate within the industry; coworking growth will slow to 5% a year due to a saturated market; coworking will be challenged during the next recession and consolidate; and coworking will be completely disrupted by economic downtown and will reduce by half.
Messer believes that the most likely outcome is that coworking will continue to grow at its current pace. He said as the market matures, big players will begin acquiring smaller operators for moderate consolidation.
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Amy Nelson, CEO of The Riveter, has made it her business to promote inclusivity of women in professional settings while also providing men tools to value gender equality.
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IWG has started rolling out a franchise model, similar to that of McDonald’s, enlisting franchisees to take the reins in subleasing Regus and Spaces offices to companies.
Chicago-based Novel Coworking has purchased Denver’s 195,753 square foot, 17-story boutique office property Trinity Place in Uptown that is currently 65% leased.