Millions of people now go to coworking spaces to work. According to the Global Coworking survey, over 18,000 coworking locations exist globally now. Coworking locations have enjoyed steady growth since they started. There’s a good chance you are one of the millions that use coworking space, or will soon.
To put things into perspective, if every coworking space was the same company, it would have more locations than Walgreens. The future of coworking is evolving.
By 2020, coworking membership estimates include over 3 million people and 26,000 spaces. Millennials and Genz impact the demand for coworking spaces with their preferences. At the same time, the growth rate of new coworking spaces is expected to be less than in 2019.
Even though the growth is slowing, the industry is still expanding. Did you know that less than 40% of coworking spaces are profitable? As a result, coworking brands are focused on increasing profitability.
According to recent forecasts, the future of coworking includes innovation, specialization, and expansion. The industry continues to evolve combining real estate, subscription, and entrepreneurship.
Before you decide to join or invest in a coworking take a look at the trends that may offer opportunities for you, your business, and brands you know. Which trends are shaping the future of coworking? What will coworking spaces look like in 2020? The future of coworking is bright!
The Future of Coworking
We’re sharing trends for the future of coworking. A coworking space is a shared office where entrepreneurs, startups, and teams meet to work, as well as connect and collaborate.
A coworking space is not only space; it may just as much about connecting and community as work. Contributing to the rise of coworking are Millenials. Millennials are shaping how and where we work. They love coworking spaces because of startup support, networking, and non-traditional working spaces.
Even though about 40% of coworking spaces are currently profitable, the industry is expanding rapidly. On average, 70% of coworking spaces become profitable within two years of operation.
The trends that are shaping the future of coworking include innovation, specialization, and expansion. The coworking industry is just beginning and the future looks bright.
Coworking is inspiring innovation in every way. Future trends in 2020 predict that start-ups will work alongside corporate innovation teams. These teams will have the freedom of a start-up with the resources of enterprise business.
Coworking inspires innovation with this incubator type model among start-ups and businesses. The spaces are an attractive atmosphere because of the non-traditional office feel. This creates an internal type incubator business may benefit from.
The benefits of innovation will create a higher level out of the box thinking to solve problems and provide solutions. Everyone will benefit in the end. The world is changing every way in technology, entrepreneurship, and business.
Coworking will continue to evolve as well.
A focus on profitability will drive strategy in coworking more than ever. The current coworking model includes open spaces with WiFi and snacks in general. As the industry evolves, specialization for industries will quickly become a need.
For example, start-ups and businesses will want customized access to space for physical assets and product testing. Traditional coworking spaces aren’t designed to handle testing cycles for product readiness to market. As a result, new coworking spaces will rise up to meet the market needs.
Businesses are recognizing how attractive coworking spaces are to employees. As a result, they are looking to outsource real estate and office space. They are looking to coworking brands to create office spaces.
This provides opportunities for coworking spaces to offer private offices, as well as set up entire floors and buildings for brands like Airbnb. WeWork and other coworking brands are moving in this direction with businesses.
An emerging trend in the future of coworking includes offering outside services. The goal is to help members feel like their needs are being met. Coworking brands benefit by increasing the number of transactions per member. This is done by forming strategic partnerships and acquisitions.
WeWork is a great example of partnerships and integrations. As they grow, WeWork plans on offering every type of service from fitness to education. This strategy helps coworking brands retain more customers, and set itself apart in the industry.
The business model of coworking is established. The future of coworking includes a shift to focus on profitability. When a coworking space first opens, the main source of revenue stems from membership fees. Secondary fees come from renting equipment, space, and mail services.
To offset real estate and costs, coworking spaces are increasing profitability per square foot. Initially, this is done by increasing memberships per location.
Another way to increase profitability includes expanding to services offered within the brand. By focusing on serving more members needs, coworking brands will increase rates of revenue spent internally.
While growth in the industry is slowing compared to the past, coworking is pivoting to focus on expansion and profitability.
What Coworking Spaces Look Like in 2020
The future of coworking is bright. The way coworking spaces look like in 2020 is changing. The coworking industry is shifting to focus on innovation, expansion, and profitability.
Expect to see the transformation in who coworking spaces serve. The way coworking brands serve will continue to expand and meet market-specific needs. Coworking is expanding to focus on value and customer service for brands and entrepreneurs alike.
Visit us to find your next coworking space for you, your business and your team.