There's still growth ahead for coworking space

by Steve Randall04 Nov 2019

The headlines about WeWork’s financial issues have shaken the coworking space in recent weeks but the sector still has lots of potential.

That’s according to Cushman & Wakefield which surveyed real estate leaders in partnership with CoreNet Global, a worldwide association of corporate real estate executives.

It found that among the 550+ CRE execs polled, almost two-thirds of companies utilize coworking to some degree, and many respondents expect to double their commitment to coworking over the next five years.

“The results show that corporate leaders have a generally positive view of coworking and see flexible space as a growing part of their occupancy strategy,” said David C. Smith, Americas Head of Occupier Research at Cushman & Wakefield. “The percentage of employees with access to flex space is on the rise, and companies increasingly see this as part of a broader solution.”

The cost savings associated with using flexible workspace is a major draw for corporates. A third of respondents said they saved at least 5%.

“Increasingly, corporate executives recognize that integrating flexible space into their strategy can provide additional value while reducing occupancy costs by enabling them to adapt to major events such as merger activity – 63% of companies have stated they are using coworking as part of their office strategy,” said Melanie Gladwell, Vice President, Americas Head of Flexible Working Solutions at Cushman & Wakefield.

Challenges remain

Despite their optimism in coworking, 48% of respondents see an increased difficulty in maintaining company culture and cohesion when workers are operating out of a shared, coworking location. There is also concern about digital security.

However, companies are 50% more likely to indicate coworking is an opportunity to increase employee satisfaction than it is a likely deterrent to employee engagement, job satisfaction or efficiency.