“The office hasn’t changed much. But the way people work has changed forever.” We learned this from Ryan Simonetti, co-founder of Convene, during the Office Evolution Conference held in Brooklyn, NY from November 8th-10th.
Adding to his argument, Simonetti believes that “coworking is just the first step in a major CRE industry shift.” Because we have changed the way we work, we have changed the way we ‘experience’ the office. The new generation of workers have different wants and needs; and their demands go beyond that of a good salary. Additionally, technology has also empowered us to work in new ways, from anywhere and at any given time; giving rise to agile working models and remote work policies. This, in turn, has powered the flexible workspace movement, in particular the growth of coworking spaces. And, according to JLL, by 2030 30% of commercial space will be used as ‘flexible workspace’.
Yet, the change isn’t simply about the workplace. The way people interact with spaces has changed drastically–powered by new and developing technologies like mobile phones and the Internet of Things (IoT). Today, life and work are all about experiences, about how people interact with other people, but also how they interact with their surroundings; this includes real estate.
In the world of work, this means that individuals expect seamless, integrated experiences in the workplace. The way Simonetti illustrates this is by saying that basically, a landlord’s tenant is no longer a company…it’s the worker (the talent).
“What talent wants, is what tenants need, and what landlords must build.”
Coworking has strengthened the notion of workspace-as-a-service; in other words, hospitality in the workplace. And this concept can easily extend to the world of commercial real estate on a much deeper level. Coworking has taught us that people are seeking experiences, and that they want these experiences to be integrated as much as possible. Coworking isn’t just about a place where people go to work; various coworking operators offer additional services like gym memberships, on-site cafes, lounges, game-rooms, laundry services, and more.
So, back to the original question: is coworking the future of CRE?
Yes it is. Adding a coworking or flexible workspace to buildings can bring in a much higher yield compared to a traditional tennent. Integrating these spaces to buildings provides landlords with the opportunity to create experiences for users. People want spaces where they can live, work, and play. The demand for mix-use buildings will increase in the coming years, and coworking is a solid first step. This is especially true as large companies and enterprises begin to adopt coworking and flexible workspace models in order to attract and retain talent.
Because of what the new generation of workers demands, companies are being forced to embrace coworking and provide their employees with spaces that provide access to workspace, fitness, food, programming, and additional hospitality services. If landlords want to attract these companies to their buildings, they need to make sure that they have the right infrastructure and management in place in order to cater to these needs.
About the author:
Office Suite Strategies is a shared workspace consulting and management company comprised of experienced business professionals focused on assisting property owners achieve maximum value from their real estate investments. Offering a broad range of services, our unparalleled experience in developing, opening, and managing shared workspace properties enables us to achieve extraordinary results for our clients.