How to Manage Properties with Co-Working Spaces

Co-working spaces have become increasingly popular in recent years, providing flexible work environments for freelancers, entrepreneurs, and remote workers. As a result, property owners and real estate investors are looking for ways to capitalize on this trend by incorporating co-working spaces into their properties. In this article, we will explore the various aspects of managing properties with co-working spaces, including the benefits, challenges, and best practices for success.

Understanding the Co-Working Space Phenomenon

Before diving into the management aspect, it’s essential to understand the co-working space phenomenon and why it has become so popular. Co-working spaces offer a shared work environment where individuals can rent desks, offices, or meeting rooms on a flexible basis. These spaces often provide additional amenities such as high-speed internet, printing services, and communal areas for networking and collaboration.

• According to a study by CoworkingResources, the number of co-working spaces worldwide is expected to reach 40,000 by 2024, a 42% increase from 2020.
• Global Workplace Analytics estimates that 25-30% of the workforce will be working from home multiple days a week by the end of 2021, further fueling the demand for co-working spaces.
• A survey by Deskmag found that 71% of co-working space members reported increased creativity and 62% said their standard of work had improved since joining a co-working space.

Benefits of Incorporating Co-Working Spaces into Your Property

There are several benefits to incorporating co-working spaces into your property, both for property owners and tenants. Some of these benefits include:

• Increased property value: Properties with co-working spaces can command higher rents and attract a diverse range of tenants, ultimately increasing the property’s value.
• Higher occupancy rates: Co-working spaces can help fill vacant spaces in your property, leading to higher occupancy rates and more stable rental income.
• Attracting desirable tenants: Co-working spaces often attract professionals, entrepreneurs, and freelancers who are typically reliable tenants and can contribute positively to the property’s community.
• Additional revenue streams: Property owners can generate additional income by offering various services and amenities within the co-working space, such as printing, event hosting, or food and beverage options.

Challenges of Managing Properties with Co-Working Spaces

While there are numerous benefits to incorporating co-working spaces into your property, there are also challenges that property owners and managers should be aware of. Some of these challenges include:

• Increased management responsibilities: Managing a co-working space requires additional time and effort compared to traditional property management, as you’ll need to oversee bookings, maintain communal areas, and address the needs of a diverse range of tenants.
• Higher operating costs: Co-working spaces often require more frequent maintenance and cleaning, as well as additional amenities and services that can increase operating costs.
• Competition: With the growing popularity of co-working spaces, property owners may face competition from other co-working providers in the area, making it essential to differentiate your space and offer unique value propositions.
• Legal and regulatory considerations: Property owners must ensure that their co-working spaces comply with local zoning regulations, building codes, and other legal requirements.

Best Practices for Managing Properties with Co-Working Spaces

To successfully manage properties with co-working spaces, consider implementing the following best practices:

• Offer flexible membership options: Cater to a diverse range of tenants by offering various membership options, such as daily, weekly, or monthly passes, as well as dedicated desks or private offices.
• Provide high-quality amenities and services: Ensure your co-working space stands out from the competition by offering top-notch amenities, such as high-speed internet, ergonomic furniture, and well-maintained communal areas.
• Build a strong community: Foster a sense of community among your co-working space members by hosting networking events, workshops, and social gatherings. This can help attract and retain tenants, as well as create a positive atmosphere within the space.
• Partner with local businesses: Collaborate with local businesses to offer exclusive discounts or services to your co-working space members, further enhancing the value proposition of your space.
• Stay up-to-date with industry trends: Continuously monitor trends and developments within the co-working industry to ensure your space remains competitive and relevant to your target market.

Case Study: WeWork and the Rise of Co-Working Spaces

WeWork, one of the largest co-working space providers globally, serves as an excellent example of the potential benefits and challenges associated with managing properties with co-working spaces. Founded in 2010, WeWork has grown rapidly, with over 800 locations in more than 120 cities worldwide.

While WeWork has faced its share of challenges, including financial struggles and management controversies, the company’s success highlights the growing demand for flexible workspaces and the potential for property owners to capitalize on this trend. WeWork’s model of offering flexible membership options, high-quality amenities, and a strong community focus has helped the company attract a diverse range of tenants and maintain high occupancy rates across its locations.

Conclusion

Managing properties with co-working spaces can be a lucrative opportunity for property owners and real estate investors, offering increased property value, higher occupancy rates, and additional revenue streams. However, it’s essential to be aware of the challenges associated with managing co-working spaces and implement best practices to ensure success. By staying up-to-date with industry trends, offering flexible membership options, and fostering a strong community, property owners can capitalize on the growing demand for co-working spaces and create a valuable asset within their property portfolio.