How is the coworking market going? Late last year spaces reported an average of 76 members, almost 50% more than just two years ago. This development continues with a view of the expansion plans and expectations of coworking spaces for this year continues.
Expansion plans continue stable
62% of all coworking owners this year, reported wanting to expand their spaces, showing a slight increase from the 59% as reported by the 2014 survey results. Almost identical with previous survey results, one in three operators (36% in 2016 vs. 35% in 2014) reported planning at least one additional location. An interesting trend proven by this year’s survey is the similar proportion in increase year over year of spaces planning to add additional desks and space in their current location (27% in 2016 vs. 21% in 2014) as well as those planning to move their space to another location (12% in 2016 vs 8% in 2014).
Not surprisingly, the profitability of a coworking space offers owners a greater opportunity (or willingness) to move forward with expansion plans. In 2014 only 66% of profitable spaces planned to expand, compared to 78% in 2016. For those without profit or (so far) still unprofitable a little more than one in two are planning to expand. Unsurprisingly rising growth intentions of coworking spaces also with the number of members. It makes sense that the more members there are, the likeliness of increased profitability allows for more revenue to be reinvested in the business. For spaces that have 50 or more members, the likeliness of expansion is 25% greater than those who have 24 members or less. The largest amount of potential to expand also appears to be for spaces who are operating 13-36 months (69%) compared to 52% for spaces less than a year in business and 63% for those spaces 37 months and older.
High expectations level off, but remain strongly positive
The overall positive expectations provided by space owners are still quite high, but have shown signs of leveling off when comparing 2016 to 2014 results. 87% of respondents report expectations of growing membership while 82% anticipate increased revenue. The slight decrease of five percentage points may speak to the fact that more respondents have been in business for a longer time. Typically those new to the market have the highest expectations for themselves, since they start from scratch with zero members and zero income. As the market matures, the share of new spaces (which are 12 months or younger) shrinks, and reached now 34%, compared to 51% in 2012/2013. Because most of the older coworking spaces still exist and are not simply replaced by a new one.
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