On the surface, co-working companies might appear to all be the same, with a slight twist in their offerings to give the appearance of variation from their competitors. Is that really the case, or are their more differences between co-working companies than what meets the eye? One might wonder if former industry giant WeWork’s recent stumbles will make others rethink how they go to market in a co-working space industry that’s become a lot less predictable this year.
These are all interesting questions for co-working space providers to ponder, but it seems like Industrious might have the right model for today as well as the future. The flexible office space provider has more than 100 locations in 50 markets across the United States, including a recently announced 52,000 square foot location in Chicago’s Willis Tower next year. Industrious signed a management agreement with EQ Office and will equip the space with flexible offices and common area amenities that will meet current health and safety requirements.
I recently had a chance to speak with Industrious CEO Jamie Hodari about the co-working landscape. One of the things I learned from our discussion was that in many ways co-working is co-working. It fills a need for workers who are unable to or don’t want to work from home, but aren’t close to the company’s location and look at the workplace as a service. Short-term leases versus long-term leases make sense to this group.
Are all co-working firms created equal?
Hodari ascribes to a different philosophy when it comes to co-working spaces however. Rather than renting a chunk of space from a landlord and then reselling it to individuals on a short-term basis, Industrious primarily offers space as a service to corporate clients. Industrious also works with landlords to manage the process for them on a revenue share model. Additionally, the company has a lot of glass in their offices but locations look designed not just like glass boxes. The combination of Industrious’ business philosophy and the thoughtful design of its office spaces is perhaps why it’s performing so well, even in the light of a global pandemic.
The secret of co-working space success
Industrious’ strategy, cooperate with landlords, provide beautiful spaces and help corporate clients flex into more or less space as needed, seems intuitive. It is the company’s execution that makes it all work, however. There’s also the fact that Hodari and his team work with landlords to provide amenities in their buildings that all tenants can use. These shared amenities are currently all the rage and Industrious’ ability to deliver them is certainly one key to their success.
So, what does Industrious’ strategy mean for the long-term view for the co-working space industry in general? Generally, it’s wise not to get too far over your skis by signing a lot of leases that don’t provide any wiggle room if or when times get slow. Industrious looks to not only have a good plan in place, but it also executes in well. Maybe one of these days, the Coronavirus goes away and co-working becomes one important tool in the corporate real estate toolbox.