After WeWork revealed a positive growth in the first quarter of 2019, experts are still concerned about how sustainable the company would be in the face of a recession.
Colliers report tries to determine the future of flexible workspaces
The Colliers U.S. Flexible Workspace Outlook Report finds that while it seems that the sector is having an impact on the commercial real estate industry, it still only takes up about 1.6% of all office space.
The report surveyed over 27 million square feet of flexible workspace in 19 markets in the U.S. About 40% of space is in Manhattan, while another 12.7 million is laid across 10 leading office markets.
Dallas, Raleigh-Durham, Boston and Seattle were the fastest-growing regions for flexible workspace.
The top 10 coworking firms account for about 80% of all flexible workspaces at 23 million square feet of space. WeWork accounts for over 45% of space with an average of 79,000 square feet per site, while Regus still owns the highest number of sites at 21,000 square feet of space per site.
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Coworking operators have started to appeal to large corporations and enterprise clients as well, most likely due to companies trying new locations, reducing expenses, and allowing employees to work out of a creative environment.
Flexible space companies are using three basic environments to suit clients, including executive suites, hotel-curated spaces, and mainstream coworking.
The future of flexible workplaces is still uncertain as its popularity came after the Great Recession of 2007-2009, so identifying how the market will react to economic downturn is up in the air.
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According to Coworking Resources, coworking spaces are continuing steady growth this year as firms continue to gear their services and amenities towards Millennials.
Young adults have started choosing the all-in-one model when it comes to work and favoring workspaces that also provide lifestyle amenities such as gyms, cafes, and more.
Codi is a startup out of the Bay Area that allows residents to apply as hosts and provides remote workers access to apartments or houses to be used as coworking spaces.
Ahead of its initial public offering, WeWork is shifting their narrative so public market investors see their losses as investments in an effort to avoid the Uber effect.
Kr Space, WeWork’s biggest competitor in China, has raised $145 million in a new funding round led by IDG Capital as well as Gopher Asset Management and Yixing Capital.
Coworking operator Industrious will open its first workspace within an Equinox fitness center at Hudson Yards in New York City, taking up 44,000 square feet of space.
Coworking provider Spaces has announced that its fifth Australian location will be located at Charter Hall’s newly redeveloped, luxurious Raine Square in Perth.
New York-based coworking operator Knotel will open its first Dublin location by the end of the year as it continues its major expansion across several European markets.