How are coworking spaces doing two years into the pandemic? The vast majority of them described their current situation as good or satisfactory (79%). In Europe, the proportion of those who assessed their situation as 'good' doubled compared to the previous year.
Two-thirds of all coworking spaces responding to the survey reported membership growth in the final quarter of 2021. Half of them increased revenue and, just as frequently, their profitability as well.
In North America, the current business situation was rated even better overall.
The Corona pandemic continues to be extremely influential
The reasons for the differences between responses in Europe and in North America can probably be found in the different distribution and also different regulations due to the corona variants.
The development of the pandemic and legal requirements were not covered in detail. However, during the survey period, Europe as a whole enacted stricter measures against the Corona virus than did North America. And this in turn affected coworking spaces.
Compulsory home-oﬃce rules and the ban on large events were mentioned significantly more often by respondents in Europe; in North America, measures were more often limited to wearing a mask at desks, in addition to physical distancing rules.
Overall, however, the 'fear of the Coronavirus' topped the global list of major economic constraints by far. About a quarter of responding companies also saw themselves as economically limited by the lack of planning certainty.
More coworking spaces with losses than profits
Compared to pre-pandemic surveys, the proportion of profit-making spaces dropped significantly. Globally, there were more coworking spaces making losses than profits in 2021. Small chains with 2-4 locations were surprisingly slightly less threatened than those with only one or with many locations. In North America, relatively more spaces were able to generate a profit than in Europe.
Meeting spaces are in high demand
Pandemic conditions still have a significant influence on which types of flexible workspaces are in demand. Meeting spaces were particularly requested by the end of last year, presumably due to the continuing high number of virtual meetings. Individual offices followed at the top in North America, while team offices were in strong demand in major European cities.
Demand for 'hot desks' was mixed. In Europe, it was significantly above the global average. In North America, on the other hand, even event rooms were more popular.
However, it is not possible to conclude the revenues from the general demand because that also depends on other factors such as availability and price. Most providers of flexible workspaces cited 'private offices' as the most important source of revenue. Renting desk space in open areas followed in second place, and 'meeting spaces' placed third. The income from event spaces was cited as the fourth most important revenue source.
More than a third of coworking spaces' capacities are currently available
Coworking spaces operate with different business models and this makes it difficult to compare their overall occupancy rates. We therefore also asked - based on their maximum capacity - what percentage of potential new members and users they would accept until they are completely full.
Based on this, the companies surveyed had an occupancy rate of 60% on average. Here we see hardly any differences between the continents.
In Europe, stricter Corona regulations meant that 9% of available capacity could not be offered at all and was blocked. In North America, the blockage rate was only 2%. However, changes in the business model due to the pandemic situation already took place, so that areas that could potentially have been blocked had presumably already been repurposed.
In general, the longer the coworking spaces had existed, the higher the occupancy rate. Likewise, occupancy increased with the size and number of locations. However, this rate did not exceed 65% on average, even in the largest or oldest group.
Outlook: positive trend continues in 2022
Most of the operators of flexible workspaces surveyed were positive about the start of 2022. Compared with the previous months, expectations were more reserved, especially in Europe. After the Delta wave passed its peak, the Omicron wave was just increasing when the survey was distributed.
Overall, however, the forecasts in individual points painted a more optimistic picture than the review of the months before the survey was conducted.
75% of respondents expected an increase in membership within the next three months, 60% expected higher revenues and improved profitability. More than 20% of coworking spaces were already planning expansions for the beginning of the year.
Most operators of flexible workspaces are satisfied
The majority of operators reported to be rather or very satisfied with their own professional situation. Again, the respondents in North America were in a slightly better mood than their colleagues in Europe.
Special thanks to the participants of the survey!
You can download all main results in charts (3MB) for free.
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