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Here’s what you need to know today:
- Universities Are Teaming Up With Coworking Spaces
- Employees Could Resign If Refused Flexible Options
- How Companies Are Reassessing Their Real Estate Needs
- Washington D.C.’s Coworking Market Is Being Revamped
- Coliving Operators Are Adjusting To Hybrid Work Needs
- Long Island Leasing Activity Suggests Grim Outlook
Universities Are Teaming Up With Coworking Spaces
Universities are partnering up with coworking spaces in an effort to accommodate increasingly hybrid higher education arrangements.
According to JLL, flexible space is rebounding as companies switch to hybrid work policies, and this rings true for universities as well.
Flexible office spaces saw a downturn in activity over the past year, but this rejuvenated sense of purpose for the industry has led higher-level schools to seek a new revenue stream. This is mainly due to the dwindling number of international students, as well as more students switching to online courses and no longer needing to live on campus.
One instance of such a partnership comes from Purdue University, which recently partnered with Carr Workplaces to offer businesses with flexible office space at its Discovery Park District, giving users access to the school.
Another example is the Silverstein Properties, Cantor Fitzgerald and University Place Association partnership that will develop, operate and lease a life sciences-building featuring a coworking space in Philadelphia’s University City district.
“Universities are recognizing the value to the wider community of their real estate, facilities and talent,” said John Mortensen, education solutions lead in APAC for JLL’s Work Dynamics group. “Conversely, businesses bring innovation and energy to universities.”
Employees Could Resign If Refused Flexible Options
Fortune partnered with Momentive (formerly known as SurveyMonkey) to gain better insight into what is causing the Great Resignation and whether office reopenings play a role.
The poll of 2,000 U.S. adults showed that 49% of respondents who are still working remotely or hybrid will seek a new job if their employer forces them to return to the office.
Additionally, the findings revealed that young workers are the most likely to make this choice, with 57% of Millennials stating that they would search for a new job if their company makes them come back to the office full-time, compared to just 32% Baby Boomers.
Making such a move undoubtedly increases the risk of losing out on top talent. However, some organizations are taking this opportunity to position themselves as more forward-thinking than their competitors.
For instance, while Goldman Sachs and JPMorgan Chase are adamant about employees returning to the workplace, Citigroup has been adopting more flexible, hybrid practices to attract talent.
However, despite the distaste workers have for being forced to come back into the office, these spaces are not going anywhere. In fact, the poll found that only 16% of respondents want to be fully remote, but 34% would prefer to be in the office sometimes. In short, workers want the flexibility to choose where and when they work.
How Companies Are Reassessing Their Real Estate Needs
Real estate is no longer viewed as a single, physical product — now, it serves as a flexible, sometimes multi-use space that supports the increasingly hybrid and flexible workforce.
Because of this, businesses are challenged with knowing how to assess their space requirements moving forward. While it’s still too early to accurately predict what work practices will look like in the long-term, leasing deals will need to be futureproof.
One instance of a company adjusting their office needs based on the current climate is Bonnier Books, which recently altered its 20,000 square foot traditional lease to an 8,000 square foot serviced solution.
Many companies are eager to return to the office, citing worries about diminishing collaborative opportunities, decreased employee wellbeing and other aspects of the workplace that are best conducted in person. However, flexibility still remains a necessary part of operations as employees have grown the desire to have their own say in workplace arrangements.
The need for more flexible offerings isn’t new. Prior to the pandemic, many corners of the real estate industry began inching towards more agile practices, which has since only accelerated.
According to a recent Knight Frank report, 47% of organizations will look to improve the quality of space they occupy, while 46% state they want to enhance employee amenities specifically. Along with this, 55% of respondents said they would create more collaborative spaces.
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Washington D.C.’s Coworking Market Is Being Revamped
Douglas Development Corporations is taking over three former WeWork locations in Washington D.C. to expand its new flexible office concept The Mark.
The locations are expected to open this summer and feature brand new flooring, furniture, servers, wireless access and security systems. Additionally, users of The Mark will receive access to a concierge, networking events, a fully-stocked kitchen and more.
“The Mark is not only a solution for those looking to break free from their home offices or larger companies rethinking their corporate office spaces but also a place to learn new skills and interests, interact and support other members and companies and forge fresh relationships and ideas that move this community forward,” said Artur Samofalov, director of development for The Mark.
The Mark is just one operator that is taking over shuttered coworking spaces in the Washington D.C. region. Launch Workplaces is also taking up former MakeOffices locations in the area.
The coworking industry in the D.C. region is clearly revamping its offerings. MRP Realty recently launched a new hospitality program called Heyday Properties to improve services for office tenants. Its dashboard features tools similar to that of a hotel app, such as desk-side food delivery, staff to help plan meetings and catering, and more.
Coliving Operators Are Adjusting To Hybrid Work Needs
Coliving firms are seeing renewed purpose as the global workforce turns to hybrid work policies, allowing employees more choice in their work environment.
Because of this, coliving operators are looking to include workstations in order to create a better plug-and-play environment for residents.
For instance, India-based coliving and student-living operator Stanza Living has been adjusting its design to incorporate enhanced work environments, which will feature workspaces in the cafeteria area, ergonomic furniture, enterprise-level internet and more.
“Given that hybrid working will continue, from a corporate and consumer point of view, plug and play will be the preference,” said Anindya Dutta, co-founder of Stanza Living. “We have created significant differentiators and the shift to organized players in the coliving and student living segment will be stronger.”
Additionally, operator Colive stated it is currently transitioning to more hybrid living arrangements, meaning that it will be creating multi-use environments for meetings, presentations and networking with other professionals.
“The millennials are working from home and not from their hometowns, they want their privacy and at the same time need to be productive at work,” said Suresh Rangarajan, founder and CEO of Colive. “We are upgrading all our facilities and providing work stations in every studio room.”
Long Island Leasing Activity Suggests Grim Outlook
A new report from Avison Young shows that there has been a halt on leasing activity in Long Island, with this year’s volume following 42% below the 20-year annual average.
Despite many analysts predicting an uptick in suburban leasing due to people wanting a workspace closer to home, this theory does not seem to apply to Long Island.
“There is no modern precedent for the post-Covid slowdown in Long Island leasing activity due to the sudden change in office occupiers’ future workplace strategies and the 2020 recession,” the report said.
The report finds that Long Island isn’t the only suburban office market that seems to be suffering as a result from the pandemic. New Jersey also saw its vacancy rate grow to 18.8% during the second quarter, which includes 9.1 million square feet of empty space up for sublease.
It doesn’t help that Manhattan’s office availability recently hit a record high of 17.1% at the end of May. In Long Island, vacancies grew by 3% to 9.4% from the end of 2020.Share this article