According to a report released in August by JLL, a global commercial real estate services firm, the number of coworking spaces in malls, street fronts and other retail properties is predicted to grow at a rate of 25% annually through 2023.
JLL’s report is based on a review of the coworking space market over the past decade and an analysis of 75 coworking retail spaces in the U.S., totaling one million square feet. Overall, it predicts coworking space square footage will reach 3.4 million by 2030.
Since 2010, flexible working space has increased by an average of 23% annually. Comparatively, the office-property market has increased by 1% overall annually. The report indicates that by 2030, flexible space will make up 30% of all office stock.
Based on JLL’s recently released report, it’s clear that coworking spaces are increasing in popularity as an alternative to traditional office spaces.
In 2015, a guest post on Forbes.com predicted that every office would be a coworking space in five years. While it doesn’t appear that this will be the case by 2020 in just a year and a half, coworking spaces are certainly disrupting the traditional business model. Here are three ways businesses can benefit from these innovative work environments.
Coworking spaces help businesses cut infrastructure costs usually associated with maintaining an office. In addition to the cost of renting or buying an office space, traditional businesses often have to pay for costs like utilities and furnishing the space.
The cost of paying for a coworking space vs. the cost of rent alone often indicates going the coworking route is the better bet. But the difference between coworking and traditional office space is most apparent when considering those additional costs that go into paying for necessary amenities.
According to an analysis by Innovative Magazine, a coworking space can save companies as much as 60% in a large city like Washington D.C. And even in a smaller city like Dallas, the savings still amount to nearly 5%.
And overall, coworking spaces open the door to a more flexible work environment. While we’ll get to the benefits of how a more flexible environment can benefit companies in other ways, it also explains how coworking spaces cut additional costs. Businesses utilizing coworking spaces can decide to require fewer in office employee hours, eliminating the usual costs associated with running a normal 9-5 operation.
Many coworking spaces operate outside the usual bounds of traditional offices. They recognize that not everyone works best during the typical 9-5 parameters.
For offices embracing coworking spaces, this means employees have the flexibility to work when is most optimal for them. This can mean at night or in the early morning hours. It also helps people meet job obligations that occur outside of the traditional 9-5. In the world of international business, employees can work when the people they’re interacting with are working, whether that’s 3 a.m. or 9 p.m.
Flexibility is also a major draw to millions of employees who want a better work-life balance. According to a report by Ernst and Young, nearly 75% of people want a boss that allows them to work flexibly.
A coworking space communicates to these employees that their company embraces flexibility. And when employees are happy, they’re more likely to work more efficiently. The U.S. in particular has been criticized for overworking it’s citizens, but the current shift toward coworking spaces is symbolic of a shift toward more ease in the workplace.
Coworking spaces can help businesses tap into services and skills they wouldn’t normally have access to.
If you’re a marketing company that regularly utilizes the services of a graphic designer, it’s likely you either have to hire a full time graphic designer or outsource the work to an outside agency. But in a coworking spaces, these professionals are often seated at a desk nearby. This allows for a higher level of collaboration that can save companies money.
In flexible spaces companies can find opportunities to collaborate in ways they didn’t even know possible. These spaces breed collaboration by putting a variety of professionals in one space where they can bounce ideas off each other and find ways to work together. A financial advisor could find themselves at the water cooler with an artist and inspiration is likely to ensue.
Coworking spaces can also encourage increased teamwork among members of the same company. Many coworking spaces feature an open office model that puts all employees on a level playing field. This can lead to more collaboration by eliminating the traditional barriers associated with closed door offices.
Also, since a lot of spaces don’t have assigned seating, members of different teams can often find themselves sitting next to each other, leading to a new level of brainstorming that might not have previously occurred.
Whether you’re a well-established company looking to shake things up, or a startup looking for ways to cut costs, coworking spaces offer an alternative to the traditional office setup. Embracing one could be the difference between success and failure.