NYC Residential Developers Edge Into The Flexible Workspace Industry
As the flexible workspace industry continues to explode, New York City condo developers seem eager to join the party. It’s of little surprise to workspace operators in the NYC market. This year alone, we’ve seen considerable developments such as WeWork’s staggering $20 billion valuation and Knotel’s $25 million Series A funding.
WeWork’s continual rise in valuation and ability to raise billions of dollars from partners around the globe has coincided with the rapid expansion of the freelance and remote workforce. But even more astonishing is the fact that the company’s repeated success has the potential to directly impact the entire flexible workspace industry, from your local coworking operator to an entire HR department of a Fortune 500 company.
And now as you look for your next 2-bedroom, 2-bath waterfront Brooklyn apartment, it’s quite difficult to ignore the myriad of luxury amenities of which the building has included: a pool for the hot summer days, a gym to workout all the stress, and its newest offering, once coined the business center lounge, a mixed-use coworking space.
So really, why trek all the way to the WeWork location in midtown when you can hop on the elevator and within a few floors, be fully charged-up and ready to tackle the day at your new (conveniently located) headquarters.
Sounds too good to be true? Well, it isn’t. Condo developers are doubling down on creating communal spaces to fit the needs of their tenants: remote workers who want the flexibility to work anywhere, anytime–as long as there is a strong wifi signal and an array of caffeinated beverages.
“We use the phrase coworking space to describe the spaces that have been carefully designed around the way people work and their everyday lives. Residents consider this space to be a wonderful extension of their home, whether at work or at play,” says Christina Dolamore, the Director of Sales & Marketing at Austin Nichols House in Brooklyn, NY–a residential development that was featured in a New York Times article.
Across the river in Manhattan, real estate management company Gaia is also showing off their latest luxury building in the Hell’s Kitchen area. According to Real Estate Weekly, the building, named Nine52, comes with a mixed-use 2,000 sqft coworking space that will “allow residents to cancel their monthly payments to WeWork or its numerous competitors.”
But New York isn’t the only place where developers are hoping to cash in on their coworking amenity investment. The Catalina Design Group, headquartered in Carlsbad, California, has seamlessly integrated coworking spaces into their many condo projects spanning the coastline from Anaheim to San Diego. Catalina is working alongside developers who are “willing to adapt to the needs of the market and go in the direction of where the demand exists.”
The demand to work and live under the same roof isn’t a new concept for today’s millennial worker. Founded in 2012 in Los Angeles, the startup, Podshare, has made living more affordable for those individuals who prefer a “social network with a physical address.”
Their model appears to attract the transient freelancer–who prioritizes access over ownership–in stark contrast to those purchasing a condo overlooking the Hudson River. The pods are all-in-one communal spaces fit with coworking tables, charging stations, and shared kitchens where beds turn into dedicated desks during the day.
“According to surveys we conducted semi-annually, we know that today’s professional places a significant value on convenience,” says Karen Condi, President of Office Suite Strategies, an executive business suite and management company based in Lexington, Kentucky.
“Furthermore, we have also learned that commuting to an office more than 15–20 minutes is not desirable–so this leads us to believe that we can lose coworkers in our own buildings if they had the option to work from building they live in,” Condi adds.
The question remains whether developers continue adapting to the markets they are serving or will the changing office landscape dictate for the developers what locations they should focus on by adding coworking amenities to their properties.
For Condi, “the [coworking] industry will just need to adapt its offerings in markets that are affected by this trend. I believe there will always be a need for workspace (meeting spaces, conference rooms, etc.) outside of what is offered in a residential building–even if the primary workspace is in their residential building.”