The Rise of Coworking Spaces in U.S. Cities

People move to the suburbs for space and a lot of workers have the opportunity to work from home, whether in their home office, guest bedroom, kitchen, or whatever, but it’s lonely. People need to get into this [coworking] space to be more productive.
Annisa Teich, Owner of West Hartford Coworking

As a freelancer, I’ve spent many hours searching for the perfect place to work. I’ve scoured all of the “best coffee shop” lists, sleuthed for the most comfortable hotel lobby armchairs, and even redesigned my guest bedroom into an office—all for the sake of finding the best space for productivity.

I’ve also debated joining a coworking space. Coworking spaces are membership-based offices where groups of professionals work in a shared communal environment—and they have boomed over the last decade. There were nearly 15,000 coworking spaces around the world in 2017 and that number is expected to double by 2022.

Every day, I walk around my home city, London, and see giant WeWork signs every few blocks. I’ve also scanned coffee shop corkboards with advertisements for hotdesks and small-scale coworking spaces. The coffee shop down the road from my house offers “stylish collaborative desk spaces” with bottomless drip coffee, speedy Wi-Fi, a private meeting area, and 24/7 access. There are even restaurants repurposing their dining rooms for freelancers and remote workers during the day.

WeWork was the pioneer of coworking spaces. The company was founded in 2010 and today manages more than 10 million square feet of office space and is reportedly (and contentiously) valued at nearly $50 billion. The company provides workspaces for companies of all sizes and professionals of all kinds, including entrepreneurs, freelancers, startups, small businesses, and large enterprises. It is one of the largest tenants in London, New York, Chicago, and Washington D.C.—there are 11 WeWork offices in my neighborhood—and is expected to go public this year.

Why Have Coworking Spaces Become So Popular?

The dramatic rise of WeWork—and coworking spaces more broadly—can be attributed to the confluence of two trends in the workplace. The first relates to how we work. Technology and innovation have untethered work from one physical location, reshaped the nine-to-five workday, allowed for more flexibility and efficiency, and blurred the lines between work and play.

The second touches on why we work. Unlike older generations who typically held the same job for decades despite its conditions, Millennials are more likely to job hop in search of a career that gives them meaning. They prioritize happiness and purpose at work over stability, which is changing the nature of work.

Millennials are known for killing lots of things (e.g., bar soap, the real estate industry, cable TV, etc.), including the nine-to-five job. A study conducted by Upwork and Freelancers Union estimates that 56.7 million Americans freelance—an increase of 3.7 million in the last five years. As freelancing and self-employment continue to grow, experts believe that remote work will soon be the standard.

Because technology has allowed us to work from anywhere and at any time, the demand for flexible workplaces has become the norm—especially at startups and modern companies—which is why WeWork had thrived.

Coworking Spaces in Cities of All Sizes

Coworking spaces offer different benefits to different people. For freelancers and remote workers, it’s a professional environment away from home and free from distractions—like a load of laundry or a dirty kitchen. For small companies and agencies, it’s a scalable office that caters to the ebbs and flows of business and provides out-of-box services, like additional conference rooms, printers, Wi-Fi, and coffee—the things an office manager would typically offer.

One could also see the benefit for employees at larger companies in key global cities. The demand for flexible workspaces in major metropolitan cities increased by nearly 20 percent this year, according to The Instant Group, a consultancy that helps companies reinvent their workplace. “We also see a broader societal trend towards relocation to less expensive areas, with employees demanding shorter commutes and a higher quality of life,” noted chief marketing officer John Williams.

As major metropolitan cities continue to balloon, commute times are growing as well. Longer commutes result in higher chances of chronic stress, sleep deprivation, and obesity. Companies that allow their employees to work from a coworking space close to home could have happier—and therefore, more productive—employees.

The Instant Group also notes a strong demand for coworking spaces in secondary cities. As real estate rates and the cost of living increase across the biggest cities in the world, many companies are looking to reduce costs by moving to smaller towns. WeWork recently launched its third location in Manchester and plans to open spaces in Cambridge, Edinburgh, and Liverpool—and coworking spaces in smaller markets are thriving.

As Millennials are beginning to move away from expensive major cities, secondary cities like Austin, Raleigh-Durham, Nashville, and Portland have seen spikes in population growth, according to a report by the Urban Land Institute. While coworking spaces have become part of the fabric of major cities, they’re still new offerings in these younger markets resulting in an untapped demand from suburbanites for flexible coworking spaces.

A Spotlight on West Hartford Coworking

“It’s not like New York, where people ask, ‘Where do you cowork? Are you at the Wing? Are you at Soho House?’ Here, it’s more like, ‘What is coworking?’” explains Annisa Teich, owner of West Hartford Coworking.

West Hartford Coworking is an affordable working space in Hartford, Connecticut for remote workers, entrepreneurs, and small businesses. Teich took over ownership from its founder—a freelancer himself—four months ago. Since then, she doubled its membership, showcasing a strong audience and the natural need for suburban coworking facilities.

“People move to the suburbs for space and a lot of workers have the opportunity to work from home, whether in their home office, guest bedroom, kitchen, or whatever, but it’s lonely,” she explains. “People need to get into this space to be more productive.”

While West Hartford Coworking members’ overall needs are similar to those of urbanites, their perspective on how to fulfill those needs is quite different. Teich, who is originally from New York City, admits that suburban coworkers desire more space and a quieter workplace.

“The mentality of the member is different,” she says. “Folks in the city are used to living like sardines. In the suburbs, they want more space, a healthy-sized desk. They certainly don’t want the constant buzz.”

Teich also admits that suburban workers tend to be more cautious and frugal, which is why West Hartford Coworking offers various levels of membership, including a monthly dedicated desk with 24/7 access and meeting rooms, a monthly part-time desk membership, and an hourly meeting room membership.

Other Benefits of Coworking Spaces

A recent WeWork study in London found that its members save 38 percent over traditional real estate options, but their savings go beyond real estate expenditures. Four in five members report that their productivity has improved since joining WeWork and their financial savings allow them to hire new employees. Many also prefer the coworking space because it enables small businesses to focus on running the business instead of splitting their time trying to provide all the right services and amenities for its employees.

But beyond flexibility, office-as-a-service benefits, and design-focused rooms, coworking spaces provide workers with a strong sense of community from which they can derive meaning.

As a freelancer, I love my autonomy. However, I’ve gone days without interacting with people due to the solitary nature of my work. As human beings, we all crave social interactions and a sense of belonging. At the core of a coworking space is its community, which allows professionals to talk to others about their work, share their ideas and innovations, and work together to achieve their goals. But even for those who don’t want to talk and meet with people, a coworking space provides a more indirect sense of community and belonging just by working alongside each other.

Research conducted by the University of Michigan’s Stephen M. Ross School of Business showed that people thrive in coworking spaces because they see their work as meaningful, feel like they have more job control, and feel a part of a community. The study notes that the community element is crucial; however, socializing isn’t compulsory:

Members can choose when and how to interact with others. They are more likely to enjoy discussions over coffee in the café because they went to the café for that purpose – and when they want to be left alone elsewhere in the building, they are. And while our research found that some people interact with fellow coworkers much less than others, they still felt a strong sense of identity with the community. We believe this comes from coworkers knowing there is the potential for interactions when they desire or need them.

Different people have different preferences for how they work. The key for those who operate coworking spaces is to understand these preferences and to create a community around them. Despite WeWork’s unprecedented growth, local coworking spaces are thriving because they understand their market best.

“It all comes back to the loneliness,” says Teich. “They do want other people there, but whether they take advantage of that socially or professionally, that depends on the personality. What a coworking space offers is a rough sense of what community is.”

In parallel, other forms of professional community environments are popping up all over, like member clubs that cater to certain industries or types of professionals. The Wing focuses on female professionals across industries; the Conduit, in London, is dedicated to social impact and environmentalism; and Alma is building a “co-practicing” space for therapists, coaches, and wellness professionals. Incubators and accelerators, too, are hugely popular with entrepreneurs and startups.

Even brands are catching onto the broader societal trend of building community spaces. Lululemon recently opened a 25,000-square-foot store in Chicago with yoga and meditation studios, a café, and other areas for community gatherings—moving the company further into experiential brand territory. “We know that consumers want to participate in communities with people who share their passion,” Lululemon CEO Calvin McDonald told Forbes.

And this is at the core of the coworking trend. People want to feel like they are part of something larger than themselves. In the age of connectivity, it’s easier than ever to feel isolated and coworking offers a sense of belonging and identity—of working towards something together.

Even if you’re not actively working on the same project, the energy of being around other people who are passionate and working on their own projects is inspiring. All freelancers have had to combat feelings of isolation and lack of motivation at some point or another—perhaps coworking might be the perfect place for that.

Laura Childs
Laura Childs
Writer

Laura Childs is a versatile writer and media specialist living in London. She's a California native and has written about arts, culture, and tech in San Francisco. A self-proclaimed data nerd, she loves telling people's stories supported by research. When not writing, Laura teaches and practices yoga. You can find more of her work and get in touch at www.lbccreative.com.

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