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ICYMI: Here’s What Happened In Flexible Workspace 2021 (And What’s Next?)

Demand for flexible workspace was hot this year and it shows no signs of cooling off anytime soon. Despite the pandemic the number of coworking users is expected to reach 6.3 million within the next 4 years.

by Jo Meunier
December 27, 2021
in Coworking
Reading Time: 12 mins read
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  • The flexible workspace industry, albeit somewhat battered and bruised from the effects of the pandemic, is finding new ways to adapt and evolve. 
  • Despite lockdown measures and uncertainty all around, if there’s one thing that 2021 proved is that demand for flexible space is hot—and here to stay.  
  • Let’s take a quick recap of what happened in the world of flexible workspace over the past 12 months. 

So that was 2021. 

Some parts of the world may be feeling a dense of déjà vu – at least where the pandemic is concerned. Many nations started 2021 under tight restrictions and are unfortunately closing out the year in much the same way. 

But after another year of learning, scientific development, adaptability, and of course a global vaccination program, we have cause for optimism as we move forward into 2022. 

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And that’s not all.  

The flexible workspace industry, albeit somewhat battered and bruised from the effects of the pandemic, is finding new ways to adapt and evolve. Flexibility is crucial in helping people and businesses move forward and grow, and if 2021 is anything to go by, there are plenty of strong signs that flexible workspace is starting 2022 in a position of strength. 

Before we discover what 2022 has in store, let’s take a quick recap of what happened in the world of flexible workspace over the past 12 months. 

1. Demand for flex space is hot. 

Economic uncertainty tends to generate demand for flexible workspace. For example, in the UK, enquiries grew, and occupancy rates began to stabilize throughout the year. By the summer, it was reported that demand for flexible workspace had surpassed pre-pandemic levels by 48% (Workthere). 

Enforced work-from-home measures created pent up demand for workspace in many different locations, and as restrictions eased, coworking made something of a comeback. One source claims that coworking will continue growing through 2025, with the number of users expected to reach 6.3 million within the next 4 years. 

In particular, there has been a big focus on out-of-town locations over the past year, and demand for space in the suburbs and secondary cities has seen healthy growth. 

All in all, there’s a big opportunity for growth in many parts of the world next year. 

2. Expansion, expansion, expansion. 

The aforementioned demand has led to healthy growth and expansion for flexible space brands all over the world. 

Industrious is certainly living up to its name, having taken over CBRE’s Hana as part of a $200 million funding deal. It also acquired assets from Canadian rival, Breather. 

In Asia Pacific, China’s largest coworking firm Ucommune revealed its intention to open its first location in Australia, while established Australian brand, Hub Australia, attracted pharmaceutical giant Amgen to one of its Sydney locations. 

And that’s not all: 

  • Premier Workspaces announced plans to add 100 new locations over the next few years 
  • Tishman Speyer’s Studio expanded in New York City with two new locations 
  • JustCo entered Japan in partnership with Tokyu Corporation 
  • IWG continued its franchise growth and announced plans to open five new locations in North London over the next four years 
  • Germany-based Sirius Real Estate revealed its UK debut with the acquisition of BizSpace from Värde Partners 
  • Mindspace raised $72 million towards its continued expansion around the world 
  • UK-based Bold set out plans to open its first Manchester community in January 2022, in the popular Spinningfields area. 

And it’s not all about operators.  

Service providers associated with the flexible space industry are seeing growth too, including Upflex, which acquired WorkClub as part of its planned expansion in the EMEA region, and software provider OfficeRnD, which expanded its team and opened a new office in Melbourne, Australia. 

3. WeWork made more headlines. 

In 2021, WeWork once again stole the headlines – in fact, more than once – by finally going public in October. 

The company officially listed on the New York Stock Exchange following a merger with special purpose acquisition company BowX Acquisition Corporation, at a (then) valuation of $9 billion. 

But the headlines didn’t stop there.  

After revealing its first report as a public company, trouble began brewing in the form of a “massive oversight” in its financial statements, which led law firm Bragar Eagal & Squire, P.C. to launch an investigation into the company on behalf of WeWork stockholders. 

Not the best way for WeWork to close out the year. Let’s hope 2022 fares a little better for the troubled coworking giant. 

4. Flexible spaces introduced vaccine mandates. 

In July, research suggested a link between vaccination rates and demand for flexible space. Instant found that cities with the lowest vaccination levels reported the weakest demand for flexible space, while cities with higher rates, such as Denver and San Francisco, performed significantly better. 

By the end of the summer, operators were beginning to announce vaccine mandates. Convene was among the first to require proof of vaccination for the safety of its staff and members, which came into effect in September. 

5. Systemic challenges came to the surface. 

Several women-focused coworking spaces struggled to stay open when the pandemic took hold, and many female owners were forced to close or sell their businesses.  

It is a systemic challenge: for one, women are still the primary child caregivers and home carers; having to fund and support a business – especially through a pandemic – is proving challenging. 

In addition, women have a harder time than men in securing funds to grow a business, which makes it more difficult for women-owned businesses to survive during economic crises. 

“We have systemic challenges that we face as women, and that has created some challenges for female entrepreneurs. When coworking spaces have a very high female membership and all those women start closing their businesses, there are potential ripple effects, and women are less likely to get funding from investors.” — Laura Shook-Guzman, Women Who Cowork 

6. But positively, the pandemic is helping to build inclusive workplace cultures. 

The pandemic has brought many challenges and important issues to light. 

One silver lining of the current situation is that efforts to encourage people back into the office are focusing increasingly on culture, and employers and workplace operators are taking a closer look at their communities to understand how to create workplace cultures that are more inclusive and accessible. 

One coworking organization that is advocating for positive change is IDEA (Inclusive, Diverse, Equitable, and Accessible). 

“We each have the opportunity to make decisions in our businesses, organisations, and communities, and we also often have the platform and access to a larger network where we can influence [others] by changing our behaviour and leading by example.” — Ashley Proctor, IDEA collaborator 

Read more about IDEA’s work here: 

  • How To Create A Workplace Culture That Values Inclusivity 
  • Connecting The Dots Between Diversity, Inclusion, Accessibility, And Revenue 
  • How To Create A Support System For Men In Your Coworking Space (And Why You Should) 

7. We also learned that… 

Digital nomads are slowing down (a little). The impact on travel led some freedom-loving digital nomads to stay local, while also encouraging home-based workers to get out a little more… leading to the ‘lomad’ trend. 

‘Lomads’ (local nomads) are a group of people who have the option to work across multiple locations without a fixed desk. Much like travellers, they book space as needed and work on a flexible basis. 

With hybrid work models increasing, we could see many more lomad workers in 2022. But a word of warning: employers who try to restrict movement or flexibility could become victims of ‘The Great Resignation’ — another big trend of 2021. 

In April 2021, four million Americans quit their jobs (according to the Labor Department).  

Why? 

People were, and still are, rethinking what work means to them and how they spend their time. The upheaval and ongoing uncertainty caused by the pandemic is leading many workers to evaluate their work/life choices, and in some cases, are quitting to work for companies that are more closely aligned with their values. 

Others are quitting to start their own businesses, or to become full-time freelancers. 

The good news is, this stands to benefit flexible workspaces, as greater work flexibility and growth in entrepreneurship typically drives more people to coworking spaces and flex space services. 

What’s Next? 

As the year draws to a close, we’re all left wondering what 2022 will bring: more of the same? Worse? Something better? 

That partly depends on your past experiences and your future perspective. And while certain elements remain beyond our control, one thing we can do is to focus on personal and professional improvement. Keep learning, keep asking questions, keep moving forward. 

Here are some resources to help you get started. For everything else, don’t forget to check out the most recent podcasts on Allwork.Space and sign up to our newsletter for all the latest news, trends, and insights related to flexible workspace and the future of work. 

  • Learn How To Gain Valuable Press Coverage For Your Workspace 
  • Business Strategies To Attract And Retain Flexible Workspace Members 
  • Flexible Workspaces Will Need To Become More Flexible (Podcast with Mark Hemmeter) 
  • Why Flexible Workspaces Fail: 3 Common Pitfalls 
  • What’s My Business Worth? A Guide To Coworking And Flexible Workspace Valuations: 
    • Part 1 
    • Part 2 
    • Part 3 
  • Everyday Things You Can Do To Create A More Sustainable Space 
  • The 5 Best Tried-And-Tested Lead Generation Strategies For Coworking Brands 
  • 5 Pros Share How To Use Instagram To Grow Your Coworking Business 
  • Want Your Coworking Newsletter To Actually Convert? Start By Keeping It Simple, Fun, And Consistent 
  • Workspace Design Show: How Can We Design Better Workspaces? 
  • The Top 7 Skills You Need To Land A Tech Job (And Where To Learn Them) 

 Here’s to a happy and healthy New Year. See you in 2022! 

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Jo Meunier

Jo Meunier

Jo is Allwork.Space's Senior Editor for the UK and Europe. Jo has worked within business centre and coworking circles since 2009, researching and contributing written features for numerous industry publications. She reports on the latest market news and delves into local issues with one main objective: to champion the flexible workspace industry and its members.

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