By now, I have discussed the top three most significant trends impacting the real estate of tech companies, labor, cost, and density here, but that’s just the tip of the iceberg. Let’s dive into the fourth most impactful trend, flexible space.
Trend 4: Flexible space evolution
Co-working is here to stay because as it turns out, a lot of people like it. Flex office options, like co-working space, offer companies real estate options on short notice, without having to sacrifice culture. But coworking isn’t expected to be limited to just the office environment. In the coming years, we can expect to see a blurring of lines between not only traditional coworking centers and the traditional office, but also hotel lobbies, coffee shops, retail banking centers and office common areas, all of which will be implemented into office spaces to serve as “third space.”
It will be interesting to see how this third pillar plays out in our market. In Phoenix, the users who are utilizing coworking space the most are companies who are dipping their toes in the water. The users are new companies that are entering the market and need temporary area or want to feel out the market before opening full operations here, at which time they most likely lease their own space.
New coworking operations like Serendipity Labs, Workuity and Galvanize, are entering the Phoenix market but we haven’t seen major, established companies utilize these services as they do in other markets. In Phoenix, the coworking space we are seeing has been mostly small offices. The demand for coworking space has been driven by the growth of creative and tech industries as well as the changing nature of work. As technology has advanced, working remotely from a variety of locations has become easy.
With startups popping up left and right in Phoenix, coworking spaces are not going anywhere, except up. Coworking spaces are a part of the future of commercial real estate, and we will continue to see them appear around different markets.
Stay tuned for my next article in which I’ll explore trend number five: generations matter.