- There are an estimated 35,000 flexible workspaces in the world today.
- The global market value of flexible workspaces is estimated at an approximate $26 billion.
- Despite the negative impact the COVID-19 pandemic has had on the coworking spaces, the industry is expected to continue growing and thriving in a post-pandemic world.
Coworking is here to stay. It was here to stay before the coronavirus pandemic, but the onset of the COVID-19 pandemic has solidified coworking’s standing as a preferable workspace solution.
In the early days of coworking, many argued it was nothing more than a movement and trend that would eventually fade away.
Twelve years later, what started as a movement has become a full-blown industry that has entirely disrupted the way people lease and use office space. As demand for coworking spaces has risen and the industry evolved, so has the terminology. Today, many people use coworking, flexible workspace, and workspace-as-a-service to refer to the same thing.
One thing is clear, regardless of the term you decide to use, flexible work environments are here to stay.
From trend to mainstream
The Oxford English Dictionary defines normal as: “the usual, typical, or expected state or condition.” As Sara King notes in this article, coworking could arguably be classed as a ‘new normal’ for workplace requirements. And we think that’s spot on.
Coworking spaces have become the expected and preferred workplace of today’s workforce. This is now truer than ever, especially as more companies shift to permanent remote work options following the coronavirus pandemic. Companies adopting hybrid work models are incorporating flexible workspace solutions into their real estate strategies in order to cater to the needs of remote workers across different cities and countries.
It’s not just the increased adoption from corporates that points to coworking being the new, preferred normal; it’s also the increased interest the coworking industry is experiencing from landlords, property developers, and investors alike.
A bright future ahead
The coworking industry has been hard-hit by the pandemic. But better days are ahead.
Despite a slowdown in growth, research from the past year shows that the coworking industry will come out alive and strong following the COVID-19 pandemic.
Specifically, reports have found that suburban coworking spaces stand to win the most in a post-pandemic world. As remote work is adopted, many are choosing to leave big cities in favor of more suburban (and affordable) areas.
Numbers that back up the growth and potential of coworking (updated, March 2021)
Statistics gathered from reports published in 2020-2021
- Despite the pandemic, many markets globally have shown increased demand for flexible workspace, and on shorter terms. The Instant Group forecasts flexible workspace supply growth of over 21% in 2021.
- Aas of Q2 2020, the coworking footprint nearly doubled since 2017 to 86.0 million square feet (msf).
- Coworking space as a percentage of total office space nearly doubled from 1.1% in 2017 to 2.1% as of Q2 2020
- 67% of CRE decisionmakers are increasing workplace mobility programs and incorporating flexible space as a central element of their agile work strategies.
- 86% of CBRE respondents see flexible office space as a key component of their future real estate strategies.
- More than 90% of respondents projected lease flexibility will increase in the future. Of these respondents, 25% believed this will take the form of more flexible workspace agreements.
- The Commercial Observer estimates that coworking spaces are likely to double or triple in the U.S. in five years.
- Landlords will increasingly allocate 10 – 25% of their assets for flexible leases.
- 71.5% of workers that used coworking prior to the pandemic plan to return to it, while 54.9% of remote workers that didn’t use coworking before stated that they will consider joining a coworking space as a remote work solution in the future.
- 40% would like to be able to work from a third-party place such as a coffee shop or a coworking space (+11%).
- Coworking spaces will become popular among a growing percentage of employees (from 30% pre-crisis to 40% post-crisis).
- 20% of corporate workers used coworking space at least one day a week, an increase from 14% in 2019.
- 30% of flexible workspace providers reported that occupancy rates have remained relatively stable through the global lockdown, only falling by 10%.
- Supply in the UK has grown by 4% despite COVID-19.
- The share of the flexible office market held by London continues to grow year on year, up to 31% in 2020.
- The UK flexible workspace market is on track to hit 12.5% penetration within two years – a doubling of current supply.
- 90% of LATAM operators are planning to expand over the next 12 months.
- Despite the COVID-19 pandemic, JLL still predicts 30% of all office space will be consumed flexibly by 2030.
- The U.S. total flex office inventory was reduced by only about 1% in H1 2020.
- Inner cities have become the most popular location type to date in 2020 with a 52% share of demand.
- 43% of workers would consider working from a company-provided location nearer to their home at least a few times a week.
The statistics were compiled from a number of reports:
The Instant Group – 2021 CRE Predictions, The Changing Face of an Industry: UK Flex Market Review, The Growth of Flexible Workspace in Latin America, The Rise of Suburbia: Can a hub and spoke model really work?
JLL – The impact of COVID-19 on Flexible Space, Shaping Human Experience
CBRE – The End of the Beginning, Workforce Sentiment Survey
Colliers International – Flex Forward
Coworking Insights – 2020 Future of Work Report: What the Future Holds for Coworking & Remote Work
Cushman & Wakefield – The Changing Role of Coworking in the Workplace Ecosystem
Gensler – US Workplace Survey 2020