Co-working space seems to be on the tip of everyone's tongue these days. There was a time when no one knew what the term "serviced office" meant or why someone would want such an option. But today, you can't open a business publication without seeing an article about co-working.
Nithipat Tongpun, head of advisory and transaction services – offices, CBRE Thailand
Most people think of a co-working space as a thriving hub of young latte-sipping, technology entrepreneurs, coming up with the next big idea that will make them multi-millionaires.
While there is an element of truth to this image, the goal for many co-working space operators is to change the way that companies, not just startups, source their office space, according to the property consultancy CBRE Thailand.
They want companies to pay for office space as a service rather than follow the traditional route of signing a lease, fitting out space, having an office manager maintain it and hiring their own employees for reception and administrative duties.
Co-working office operators usually offer companies their own private space, based the number of desks they expect to need. For example, if your company has four employees, your package offer will include a furnished closed office with four desks, four chairs and optional telecommunications equipment for four people.
There is usually a common kitchen area and spaces to meet and mingle as well. Think of it like a five-star hotel: you're not sharing a room, but you are getting a high level of service and amenities.
You usually have a short-term commitment rather than a years-long lease. The best deal is usually for a year or more, but you can lease your office for as short as one month. Since the office is already outfitted and reception services provided, getting down to work is much quicker than when you need to design a space yourself or hire your own support staff.
LOOK BEYOND PRICE
"Competition in the co-working space is red hot. As more and more offices pop up, the fight to achieve 100% occupancy is fierce," says Nithipat Tongpun, head of advisory and transaction services for offices at CBRE Thailand.
"When shopping for your space, be sure to consider more than just price, as the services and reputation of your provider are just as important.
"If you do your homework, you'll avoid the pitfalls of co-working space, such as unreturned deposits, unexpectedly thin walls between units or fees for things like coffee and copying that you didn't expect. The great news is, changing providers is much easier than with traditional space."
A CBRE report on the New York City office market sheds further light on the trend:
Since 2013, when the expansion of third-party flexible space began to gain significant traction, the sector has averaged annual growth of 22%.
Seventy-five percent of corporate office occupiers anticipate including co-working or flexible space in their portfolio over the next three years.
Smaller users remain an important part of the target market: traditional leasing among tenants for under 5,000 square feet (465 sq m) fell by 42% between 2013 and the end of 2017, suggesting that these users are migrating to flexible space solutions.
In Bangkok, four large co-working space operators have multiple locations. JustCo, Spaces, The Great Room and WeWork leased a combined total of 25,000 square metres of space in some of the capital's best buildings last year and they are still growing.
In Singapore, The Great Room reports that 30% of its clients are late-stage startups, 30% are private investment family offices and 30% are mainstream corporates.
In the case of corporates, they often lease co-working space as a stopgap before finding a larger permanent office for their expanding team.
AGILE WORKING
Even companies that continue to lease office space directly are changing the way they use the space -- having your own office or even your own desk is out of fashion and agile working is all the rage.
"Companies are providing employees with a daily choice of environments from quiet space to a layout that enables teams to collaborate. Employees are expected to move around, depending on tasks," said Mr Nithipat. "The objective is to create a workspace that fulfils the employees' needs in a high-quality environment, while minimising the number of individual desks needed, effectively putting more people to work in less space."
CBRE foresees significant growth in co-working spaces provided by third-party suppliers. This will mean an increase in demand for high-quality buildings with flexible, column-free floor plates, advanced air conditioning and temperature control, as well as sufficient lift capacity to deal with higher occupation density.