The past year was full of changes and adjustments across all industries, and the coworking category was no exception. The speed of the massive shift to a work-from-home model created challenges that our relatively young industry could not have previously fathomed.
Our strengths as an industry – flexibility, cultivating a strong sense of community, cross-collaboration and shared spaces – suddenly became barriers as our teams sanitized every surface, counted the number of feet between our members and actively researched technology and new protocols to protect our communities from COVID-19. As our tenants faced difficult financial decisions and fretted over expansion plans that had seemed so promising in 2019, coworking companies of all sizes faced their own existential crises.
But as the workforce forges ahead into 2021, coworking has emerged as the office real estate type best-positioned to capitalize on the new normal, offering companies and employees the choice they have come to expect and the flexibility they need in a still-uncertain environment.
Companies and employees alike have learned that remote working works – to a certain extent – and that employees don’t necessarily have to be physically present every day in a centralized office to be effective workers. At the same time, employees’ mental health has suffered as a result of our current situation, with one survey by the Conference Board indicating a 42% increase in the number of employees reporting burnout and a 46% decrease in work-life balance as work-from-home has persisted.
Accordingly, companies will increasingly implement a hybrid model, or one that combines remote work with in-office work to provide the flexibility that will soon be an expected standard for modern employers while also supporting the need for team members to come together and collaborate when needed.
At Shift Workspaces, we’re gearing up to accommodate some key trends over the next several months:
Supporting the hub-and-spoke model
Historically, urban environments have been at the center of office life. Commuting to a high-rise in a busy – often expensive – downtown area was seen as the cost of doing business. Now, that thinking is shifting. People accustomed to working from home and avoiding time spent in traffic are loath to return to the old way of doing things. Companies are recognizing they don’t have to maintain such a large real estate footprint in the central business district.
As a result, we’re seeing a significant shift to a “hub-and-spoke” model, in which a company maintains a smaller central office in a downtown while establishing one or more smaller offices in suburbs, giving employees the benefits of a dedicated office environment closer to home.
The logistics of managing many small offices are complicated and obtaining several traditional leases in one market poses financial challenges for some. Coworking space is the perfect solution, offering companies multiple locations with flexible space options and no operations or management hassle. By working with one coworking provider that has multiple locations in a metro area, companies can work with a single representative and streamline the process.
Flexibility is king
Long-term office leases have been the standard for years, as lenders who fund office projects have required developers to lock tenants into long-term leases to mitigate risk. But in the new world of work, predictable cash flow will take a back seat to flexibility, especially in the near-term, as companies seek space that allows their employees the benefits of in-person collaboration or a quiet, dedicated space outside of the home to work while waiting to see what long-term needs they might have once normality returns in earnest.
A survey by CBRE at the end of 2020 indicated that 86% of respondents saw coworking as a key component of future real estate strategies. Many in the real estate world saw coworking as a valuable tool that should be incorporated into strategies even before the pandemic accelerated the need for flexible offerings.
Flexibility is what coworking providers do best, offering desks for as little as an hour at a time. But they also offer critical infrastructure, high-quality technology and, in some cases, even design elements such as movable walls that create the ultimate flexible space for companies.
Human connection and positive mental health make a comeback
After a year cooped up at home, many people who have worked remotely since the pandemic’s early days in mid-March 2020 are ready to mingle. Even the most introverted among us is likely ready for a bit of in-person human interaction.
Research shows that the prolonged withdrawal from our daily lives and connection with coworkers and others outside our homes has taken a toll on people. The Conference Board survey, conducted in September, shows a 40% increase in the number of people reporting mental health problems and a 35% decrease in people reporting high levels of personal well-being.
Once the COVID-19 vaccine is widely available, people will be eager to see one another, meet up, and discuss things in person. Zoom and Teams have proven business-saving tools, but they are ill-suited to supporting the kind of impromptu conversations that build camaraderie and culture – the kinds of interactions that lead to true employee engagement.
Again, coworking provides interaction-hungry people with an ideal solution. Not only can people chat with coworkers, but they can also once again make new friends or business contacts from a different company in the shared kitchen space or make weekend plans over coffee.
Challenges still lie ahead in 2021 for all of us, but with the right approach, coworking providers can help make the best of the difficult hand we’ve all been dealt and not only give businesses a viable, flexible option, but also help employees re-enter the working world as comfortably as possible.