Coworking is nothing new. In fact, the first ever coworking space was built way back in 2005 but it took a while before really gaining traction. Today, coworking has been deemed a priority for anyone who owns or manages an office building - and it’s making its way to the suburbs.
In this episode of The ChangeMakers in CRE, we chat to Sheree McIntyre, Founder & CEO of Coworking Counsel. Sheree has spent the last 20 years as a leader in the coworking and flexspace arena with some of the largest global coworking operators.
More recently, Sheree has launched Coworking Counsel to offer specialised coworking consultation services to commercial landlords, developers and asset managers wanting to provide coworking spaces in their buildings.
Here’s what we covered:
According to Sheree, proactive office landlords and investors are now looking to put coworking spaces in suburban locations because of high demand. Unsurprisingly, this has been driven by a huge upswing in hybrid work models offering a split between at-home and in-office.
This trend has also been the catalyst for the rise in satellite offices or workspaces. Often referred to as the ‘hub and spoke’ model, this entails having a main office in the city centre and then having smaller offices in the suburbs.
The key reason behind this is that many people working from home require temporary offices where they can get away occasionally but not have to commute into the city centre. This is where suburban coworking spaces are coming into their own.
“The landlords and the coworking operators I'm speaking to are talking about their suburban locations being in demand. The landlords are also talking about how they get some flex space in their suburban assets.
I've also heard other coworking operators are looking for more suburban sites because it may be a given that you can work from home two days a week, but you're still in that situation where you are on your own, and the lines are blurred between what's work and what's not. I think that that suburban city fringe coworking operators has got a place now more so than ever.”
The biggest challenge landlords face when bringing coworking into their assets is security. They are used to longer leases and lower risk with the ability to forecast their income. But while some landlords wait to realize the value of coworking spaces in their buildings, others have already started investing in innovating their spaces to accommodate coworking operators and tenant demand.
“Landlords are used to longer leases and there is longevity in their valuations. There are fewer risks and fewer unknowns too; that's probably the biggest hurdle for a landlord to get into coworking.
I think there are still landlords waiting on the sidelines, treading water, and working to see how things pan out over the next year. But there are also some landlords who are very keen and proactive in working out their options regarding how they will get coworking in their buildings.
And it's not just getting flexible space into their buildings. They're also looking at post-COVID lures. So things like outdoor terraces, elevator-free access. What I mean by that is that your lower-level assets are great because you're getting an escalator or climbing stairs to the building instead of elevators.”
It's undeniable that the nature of work environments has changed as many people embrace flexible work over the traditional 9-to-5, in-office role.
However, no matter how productive people get in the comfort of their homes, they still long for interaction and collaboration with their teammates. Companies will now have to focus on employee experience and give people reasons to come to work. Coworking operators are working with landlords to deliver that which in turn means happy tenants and occupied spaces.
“We've been just giving people their wages and demanding them to come to work by 8:30am. Company owners or CEOs have been able to ride that for a long time now. But it'll be great for the population at large to have the type of environment that brings out the best in people.
We have our favorite restaurants, parks, or camping grounds, and the visual appeal of those things is very strong. We don't go there just because the food's great. We go there because it's a whole experience. It's immersive, and we get the benefits of not just the food being great but all our senses being activated. And that's similar to how I see the workplace, which benefits everybody.”
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