By: David C. Smith, Vice President, Americas Head of Occupier Research
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 Atlanta inventory has grown by a third in the last two years, and it will surpass 1 million square feet in 2018. This includes locations in the most urban parts of the city (i.e., Buckhead and Midtown), as well as new suburban locations in the fast-growing GA-400 submarket (i.e., Alpharetta).
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.
To learn more about the world of coworking, check out the latest Cushman & Wakefield Atlanta infographic:
David Smith is the Vice President, Americas Head of Occupier Research. He produces occupier thought leadership content for the Research Center of Excellence and directs a program of market presentations, written analysis, surveys, forecasts, and data collection that supports Global Occupier Services and the brokerage business, as well as advance the strategic plan in Americas Research.