By David Smith
Commercial real estate is not the fastest moving of industries. That said, the coworking trend has grown rapidly and is changing how both investors and occupiers think about their real estate portfolios. Across the United States, 50% of the current stock of coworking square footage has come online since mid-2015.
Most of this growth has been in major gateway markets such as New York, Los Angeles, and Chicago. However, the supply of coworking is now quickly increasing in secondary markets across the country.
The attractiveness of coworking is multifaceted for entrepreneurs, freelancers, and startups. There is greater lease flexibility. The space is turnkey and contains high-end, modern amenities. There is a built in community for people who often work alone. Additionally, larger coworking providers can utilize their size to offer members discounted access to services and tools that small firms and individuals may not be able to leverage on their own. This includes accounting services, access to technology solutions for customer relationship management (CRM), virtual assistants, travel programs, and many more.
Coworking is not just the domain of freelancers, however. Corporations are looking at the flexibility and the potential employee experience benefits as reason to incorporate coworking as a part of their global office portfolios. Coworking can give larger organizations the opportunity to quickly grow or shrink their portfolio size on the margins. It is also a tool for starting an office in a new market without investing in a full, traditional office location right at the start. Additionally, coworking locations can be used as “offices on the go” for employees who are traveling and may need a place to land for a day or a few hours.
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