Flexible office growth is increasingly happening outside downtown cores, with suburban markets now accounting for two-thirds of all U.S. coworking locations, according Yardi Kube.
Suburbs Are Outpacing Downtown Growth
Suburban coworking locations grew 39% between July 2024 and July 2026, adding 1,763 new sites and pushing the total to 6,247. Urban locations grew at a slower pace over the same period, up 22% to 3,137. That widened the suburban share of the market from 64% to 67%. Nationally, total coworking inventory rose from 7,058 locations in 2024 to 9,384 in 2026, covering more than 166 million square feet.
The two formats look different on the ground. Suburban spaces average about 15,185 square feet, roughly a third smaller than the 22,827-square-foot average in urban markets, creating a pattern of many smaller suburban sites paired with fewer, larger downtown locations.
Growth Varies Widely By City
Some metro areas are seeing especially fast suburban expansion. Richmond-Tidewater nearly doubled its suburban count, growing 96% to 55 locations, while Tampa-St. Petersburg-Clearwater grew 87% and Philadelphia rose 84%. Central Valley posted the strongest combined urban-and-suburban growth overall, at 69%.
Not every market is following the suburban trend, though. Central Valley’s urban locations tripled, and New Jersey’s urban count grew 150%. Some cities don’t fit the comparison at all: Manhattan and Brooklyn have only urban coworking locations, while Orange County, Long Island, and the Inland Empire have only suburban ones.
A handful of markets also buck the size pattern. In Fort Lauderdale and West Palm Beach-Boca Raton, suburban coworking spaces are actually larger on average than their urban counterparts.
Employers Are Fueling Demand
Corporate cost-cutting is helping drive the trend. Allstate, for example, cut its annual office spending from $382 million in 2020 to $138 million in 2024 while shrinking its footprint from 12 million to 4 million square feet, and now gives a quarter of its 54,000 employees access to coworking space booked by the day. Roughly 30% of coworking memberships nationally are paid for or subsidized by employers, according to industry estimates, letting companies offer workspace near where employees live without signing long-term leases. Other major employers using flexible space for satellite offices include Pfizer, Amazon, JPMorgan Chase, and Lyft.
A Response To A Shrinking Office Pipeline
The rise in coworking inventory comes as traditional office construction slows sharply. Annual office deliveries are projected at about 10 million square feet in 2026, down from roughly 75 million square feet in 2018, and conversions and demolitions outpaced new office deliveries by 3 million square feet in the first quarter of this year. That’s giving property owners another option for space that may be difficult to lease under conventional terms, particularly as demand spreads out toward where workers actually live rather than staying concentrated in central business districts.
The central challenge for operators will be balancing fast suburban growth with urban markets that, despite slower overall expansion, still support larger spaces and in some cities are growing even faster.
