THE RISE OF COWORKING AND THEIR IMPLICATIONS ON TRADITIONAL LEASING MODELS
- Publisher:
- PRRES Inc
- Publication Type:
- Conference Proceeding
- Citation:
- http://www.prres.net/, 2019
- Issue Date:
- 2019-01-01
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Coworking, or provision of communal, flexible office spaces on a short-term basis, is a rapidly growing phenomenon in the modern office markets. Coworking was initially driven by the preferences of freelancers, knowledge workers and start-up communities; however more recently the industry has targeted large corporate organisations as their new path of growth. Many landlords are being challenged by this growing demand for flexible, collaborative spaces, and are increasingly looking at how to leverage the benefits of including such spaces within their portfolio. For coworking spaces, landlords are required to revisit traditional lease structures and introduce more creative, alternative means of leasing in order to facilitate new leasing options that provide greater ability to manage volatile headcounts. This conceptual paper analyses the existing literature to identify alternative lease models that can facilitate the growing demand for flexible, scalable and collaborative spaces. The findings identify flex and core leasing model, revenue and profit share model, city campus model, joint venture model and management model as appropriate alternative lease and operating structures for coworking spaces. The findings also identify the advantages and challenges associated with each lease model from the landlord’s point of view. The findings emphasise the importance of having more dynamic and creative lease structures that are better aligned with the interests of landlords, space operators and diverse groups of office space users in flexible office arrangements.
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