Recently we’ve seen an increase in the number of corporates transitioning from a traditional HQ to collaborative office space. By 2030, up to 30% of corporate real estate portfolios are expected to be flexible workspaces, with 71% of current occupiers viewing flexible workspaces as vital to delivering corporate real estate objectives.
This trend is not just for the creative fields, corporate industries are also looking to enjoy the benefits of flexible workspace. In 2016 Microsoft announced staff in Atlanta, New York, Portland and Philadelphia would look to work from WeWork office spaces in the coming months. Since then HSBC, Salesforce.com, Facebook, Starbucks and the Bank of America have partnered with WeWork. Continued growth now suggests 65% of enterprise companies plan to incorporate coworking into their portfolio offering by 2020. With the number of companies with 1000+ staff using WeWork doubling in the last year.
These stats have many asking what the benefits of coworking are to corporate businesses. Office Freedom are industry pioneers in the brokering of coworking space and have summarized the top 4 benefits for corporates below. Reducing overheads, the need for short-term solutions, attracting and retaining talent and the flexibility terms are the top 4 benefits for corporates.
For large companies, embracing coworking can be very cost effective. Finding the right co-working space at the right price, with the added amenities built in, can be more practical than renting an empty office block and investing in high quality fit out. Improved financial performance through cost-savings, reduced capital expenditure, better risk mitigation and lower vacancy rates offer the ability to free up capital for investment in value-generating assets and initiatives. As our CEO, Richard Smith concludes, “In many cases, looking at the entire cost-benefit equation, flexible, serviced solutions are often more affordable than leases and involve a lot less stress before, during and after a business takes up a space.”
Short Term Solution
There are a number of reasons companies look for short term spaces, from launching new projects to running industry events. The misconception that short term leases are only for freelancers or businesses just starting up has been busted with the emergence of short term options for corporates. Big businesses looking to enter new markets need flexible space to keep costs under control and run logistics. When these initiatives progress and require space for team expansion and tech needs, these leases often allow for adding new space on-demand. This allows staff to have the amenities they need, without the commitment of 5-10 years. Short term leasing also allows you to skip the stressful and strenuous process of fitting your spaces out with desirable amenities.
Attract and Retain Talent
Coworking spaces focus on staff well-being, efficiency and like-minded communities which offers business greater productivity and a decrease in both sick days and staff turnover. For employees there are obvious benefits, with fewer hours spent commuting, greater independence and flexibility in their work. These spaces are designed for the benefit of employees, with inspiring workspaces in areas where people want to work or with communities they want to work in.
Alongside happier staff, shared work-space encourages innovation through exposure to new ideas and ways of working. As International Workplace Group suggests, “One of the enemies of corporate innovation is groupthink. Having all of your people under one roof, having the same conversations with the same people day after day might be stifling the potential of them generating original ideas. Putting them into a collaborative space with like-minded businesses and people can help free up their thinking.” This has resulted in enterprises like Microsoft, Verizon and IBM relocating staff to coworking spaces in order to promote innovation.
Simplicity & Flexibility
The ability to move in and out of an office at short notice allows corporations to avoid complicated contract negotiations. This becomes increasingly relevant when you consider the current economic climate. We live in an unpredictable world. Uncertainty demands flexibility. Coworking enables companies to upsize downsize or relocate at short notice, which offers you freedom to grow when conditions rapidly change.
Security, Company Branding and Bespoke Needs
With the arrival of GDPR regulations and cyber crime awareness on the rise, it’s not surprising companies are looking for ways to ensure their business is safe from fraud and attack. Coworking spaces are beneficial with their 24/7 surveillance and management systems that remove the unnecessary risk of human error.
Contemporary and creative spaces within stat of the art buildings have replaced mundane and dated office space. Now you can stamp your own identity, as the majority of coworking spaces provide non-branded, self-contained and private space. One of the great benefits for companies of all sizes is the customization to match your specific requirements. Your brand, your image and your vision shapes the output of your company and its success in the world. Using office space as an extension of that will help your business grow.
Many would not have seen the impact coworking would have in companies of all sizes, in just two years the real estate landscape is changed and continues to adapt to this new demand. While corporates continue to run their operations in traditional leases, there is an undeniable shift in how larger companies are choosing to operate. We’ve seen a great deal of change over the past 25 years. It’s an exciting time to be on the market, and as we move into 2019 we’ve predicted some of the trends you can expect to see here.
If you’re interested in exploring some offices, Office Freedom is on hand to handle your enquiry. Our free and impartial service has helped brands of all sizes with their bespoke office space needs, enquire here for more info.