Will Demand Return to the Flexible Office Industry?
The global economy is straining to navigate a wide range of COVID-19 consequences, leading many to question what the future of work may look like. After reviewing our data at Coworker, there are a number of identifiable trends that have emerged in recent months in the coworking industry in particular that are worth noting.
One point that has been made clear throughout the COVID-19 pandemic is that the way we work will change immeasurably. Remote work is here to stay — companies such as Facebook, Shopify, and Twitter have announced they will be shifting to a remote-first workforce in the years to come. Plus, in our recent report, 79.7% of respondents who have been working from home as a result of COVID-19 said they are more productive working remotely than in an office setting.
The question arises: how will the increasing number of remote-first workforces impact the flexible office industry?
After analyzing 3,012 recent Coworker leads, we believe coworking will be a net beneficiary of this systemic shift and space utilization will continue to increase as the global return to work gets underway. What we are seeing is that leads are shifting towards private offices (as a space type), longer-term durations, and higher capacity.
In comparing February’s data (pre-lockdowns) and May’s data (post-lockdowns, here’s what we found,
Further, the average capacity for meeting room enquiries has dropped from 14 to 7, an anticipated result of smaller gatherings which we believe will be an effect for some time.
In a post-COVID-19 world, coworking demand will probably be led by larger organizations looking to decentralize workforces into smaller branch offices and remote teams into private flex offices. That demand will be led primarily by private offices, followed by dedicated desks, while hot desks and meeting rooms (for non-members) will take the longest to fully recover.
Are there any other signs of a general recovery?
Coworker is monitoring and gathering insights from web traffic on a market-to-market basis. Each week, movement has depended on government policies. This metric can be seen as a leading indicator of a recovery, with the lowest traffic occurring during the second and third weeks of April, when the largest percentage of the global population was in lockdown.
Markets that appear to have made the best recoveries so far are generally in APAC and include Australia, Hong Kong, Taiwan, and China, where Coworker’s traffic hasn’t decreased by more than 20% and in some cases has returned to previous highs.
It is worth noting, these markets that have made a near full recovery (in terms of people searching for ‘coworking’) all hit their lows more than a month earlier than many other countries. This may be an indication that as other countries make a general recovery from the impact of COVID-19, the further recovery of the industry as a whole will follow as the return to work progresses globally.
To learn more about the future of work, the way coworking operators have been affected by COVID-19, and other insightful statistics related to flexible office spaces, download our 2020 Future of Work report here.