I have heard about the success of various co-working platforms in the United States. We recently completed a co-working deal for space here in China – we are a Chinese development company – and want to explore how the co-working market is set to perform over the next 5-10 years.
Based on my analysis of the current trend, the co-working trend is continuously increasing and becoming more popular. However, the popularity does vary depending on the location. Larger metropolitan areas show the biggest market for co-working. If considering going into this market, definitely do your due diligence to make sure your investment is going to be profitable.
The co-working boom shows little signs of abating. We are currently working with a growing number of office, multifamily and mixed-use developers that are considering integrating these formats into their product offerings.
Sorry, I am not quite familiar with the co-working market in the US. The co-working market in China, however, has been driven by US co-working giants, beyond the first-tier cities to 1.5 and 2 tier cities like Hangzhou, Kunming, Nanjing, Xi'An. The Executive Centre in Beijing and Shanghai has been keen on locating the best office offering in town to accommodate the rising interest from the tenants.
I do considerable legal work in the US for WeWork. They are by far the market leader and got a tremendous jump on others in developing this product and have created a real brand. My guess is that it will be hard for others to catch up and really challenge them unless others can develop some great innovation that WeWork cannot compete with. I think this area is really growing but like most things, I would be concerned that WeWork and their many would be competitors may overshoot the demand and expand too quickly, only to have to retreat and restructure. This is a new business approach so hard to evaluate how big the market for it can really get, especially if office landlords and tenants develop WeWork look, feel and amenities in their own buildings and spaces themselves, which is something some landlords are staring to do. I hope this is helpful.
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