More impermanent workers, risks associated with startups, superfluous space, aversion to long-term leases, fit-out costs, demand for time and space flexibility, cost of office space, and requirement for collaboration are factors contributing to the growth of flexible and shared office space.
Bayleys commercial, retail and operations director Lloyd Budd says millennials entering the workplace are driving the trend for flexible work space, which will see the lease model changing over time.
Budd calls coworking spaces the Uber or Airbnb of office space.
He gives the following three reasons. Shared office space eliminates the hassle that comes with long-term lease commitments, fit-out costs and the distraction of having to manage real estate requirements.
It permits collaboration opportunities. “There is also the fun factor,” he says. “Members, particularly small companies, now have a feeling of belonging rather than working in coffee shops or their homes or garages.
“This is a trend we are seeing both here in New Zealand and around the world. Some of the most conservative reports suggest that 10 percent of our workplaces will be based in co-working locations by 2025.”
Shared office space will also amend the leading model.
“Some landlords are responding to the trend by proactively seeking partnerships with coworking operators, while others are choosing to compete directly with operators and provide a solution directly to the market themselves,” he concludes.