Market Trends of Europe Coworking Spaces Industry
Increasing deals for coworking spaces in London and Paris
The co-working and serviced office sectors have grown considerably in central London over recent years. In 2018, about 183,000 m², 13% more as compared to 2017, of space was leased to co-working and serviced office operators. When it comes to London submarkets, the City (40% of deals for flexible office space in m² in 2018), the West End (28 %) and the Midtown (17%) have attracted great interest. The demand comes down to tenants seeking workspace that offers the ability to be flexible on leasing whilst saving costs. This may include changes such as shortening lease lengths, increasing incentives, or acting more as ‘service providers’, rather than simply ‘space providers’.
In France, co-working initially faltered but soon proved to be a real boost for the office real estate market with 28 deals in 2018 representing about 118,000 m²,19% more than 2017. The Paris market has already seen plenty of investment by domestic and international companies. Nevertheless, supply remains very concentrated.
The Evolving Corporate Trends
Co-working continues to evolve and is becoming more professional. Indeed, co-working space providers are renting increasingly large units and introducing strategies to address both self-employed workers, but also larger groups. Many companies seek to maintain flexibility to be able to respond to business change. This is often in the shape of project-based teams which can adapt and flow in terms of their size and staff/skills composition. The natural fit for these teams is to use flexible workspace options that give them the space and freedom to operate as they want. Also, millennials and fresh talent view companies offering ‘well-designed/cool’ flexible space options as increasingly desirable companies to work for. In the race for talent, providing these flexible workspace options could be a deciding factor in winning or retaining talent as the evolving Millennial workforce likes change, and many expect to move jobs within a 2-3 year timeframe, or have more than one job in an increasingly collaborative world.
