Co-working Spaces: The New Trend in Real Estate

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A relatively new type of business model is emerging in the realty space around the globe. This model can be referred to by many names, including Co-working spaces, on-demand workplaces, shared offices, etc. Due to spiraling real estate tulum mexico prices, this workspace model is gaining momentum. This workspace model is very efficient for companies that don’t want to be tied down by long-term lease obligations but instead prefer a flexible cost structure. This article will examine the growing trend of shared office spaces.

Why Companies Choose Co-Working Spaces

  • Cost:  This is especially useful for startups. Today, most startups are located in the hi- sector. These companies require offices that can host video conferencing, VOIP-enabled phones, leased lines, and other facilities. Startup companies are often short on cash and can’t afford to set up all of these facilities. This plug-and-play office space model is both economically and operationally viable. This is more costly for startups than it would be every month. This model is cheaper for larger corporations by about 25%.
  • infrastructure cost of an operation can be reduced by co-working spaces without affecting its quality. These co-working spaces often include conference rooms, video conferencing, and other facilities. From the beginning, companies get ready-made infrastructure. Instead of focusing on administrative tasks that add time and cost, but don’t produce any value for customers, companies can concentrate more on core tasks.
  • Travel Convenience:  Many multinational corporations choose this model for Tier-2 and Tier-3 cities. These companies don’t need a full-fledged business office in these cities. They have 10 to 15 employees. They don’t want to compromise on the quality and amenities they offer their employees. They want their offices to be centrally situated because they often work with sales and have to travel a lot. This is why shared workspaces are an option. Infrastructure is shared with other groups. This is because these other teams might be part of a different organization.
  • You can commute faster:  People in large cities get tired of driving long distances to work. Many commutes to work for four hours each way, in addition to their nine-hour job. This commute time is not worth it and should be cut. This can be eliminated by using shared workspaces. Workers shouldn’t be forced to commute to work. Workers should instead be allowed to log into the nearest shared workplace center. The time saved on commutes results in more productive employees, who can work longer hours on tasks that add real value to the company.
  • Flexibility Traditional offices can find it difficult to increase the organization’s size. A company might want to hire ten more employees. They cannot rent additional space to accommodate ten more employees. They will need to rent a new office unit. They can also cramp up their existing work to accommodate the new employees. This is not possible with shared workspaces. Companies can rent as many desks and for the period they require.

Problems with shared workspaces

  • Cost allocation can be difficult to allocate costs in a shared workspace. A fully leased office means that the company pays all electricity, water, and property taxes. These costs must be divided into a shared workspace. Here is where there are disagreements. Some companies believe that headcount is the best metric to allocate expenses. Other companies might believe headcount is more relevant. Companies will also not be able to reduce their use of electricity, water, or other scarce resources because the bill is shared. This problem is being avoided by developers who try to include these costs in their lease prices. This can lead to wastage of resources, and even disputes.
  • Privacy Shared workspaces can be cheaper and have better infrastructure. But, companies are not likely to be comfortable locating critical operations in shared workspaces. This is because of one simple reason. Data and other intellectual property can be stolen. A company’s strategy can be leaked to its rivals, which could result in a loss of competitive advantage. This problem cannot be solved by the shared workspace model.

The future of workspaces may be a combination of both of these models. Because of their lower costs and other benefits, shared workspaces may be able to do mundane work that isn’t mission-critical. Higher-end tasks that require sensitive data or strategy information might still be best left for leased workspaces.

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