Today’s commercial market hosts an array of options when it comes to finding a physical place for your business. The most common types of physical offices are coworking spaces, leasing, and purchasing a traditional office. In this article, we’ll be analyzing cowork spaces vs leasing an office.
Before making any decisions, it is vital to determine what type of workspace will best support your organization’s needs. Is a coworking space the best option for your business? Or does a traditional office lease better suit your companies’ goals? Let’s consider the pros and cons of each to determine who would benefit from each.
- Flexible workspaces: Coworking offices are already designed to improve workspace flexibility by providing a variety of work environments. Many coworking spaces also provide technologies that help bridge the gap between in-office and remote team members. One of their greatest flexibility benefits is the availability of short-term subscriptions (some offices even offer daily subscriptions).
- Networking opportunities: Sharing office space means working next to new people outside your organization. This can be a great asset for small businesses to expand their vendor and client relationships.
- Built-in management: Most coworking offices have space hosts that handle all aspects of workspace management. There is no need to supply your snacks, tackle mail management, or anything in between.
- Inclusive expenses: Although renting coworking space is more expensive than leasing an office, it is often simpler to pay for. Coworking organizations typically bundle all expenses (utilities, rent, etc.) into one flat fee.
- Limited Privacy: Sharing a workspace means that you have minimal privacy. Although most coworking spaces have some array of phone booths or conference rooms, total privacy is hard to come by.
- It is a shared space: Sharing your workspace means that you do not have the luxury of customizing your area or incorporating your brand into its design. Thus, the office will not be tailored to your unique workflows and is probably not the best space for client-facing operations.
- Lack of company branding: We already mentioned this, but we believe it deserves more attention (read more on why this is important here). Sharing a workspace means that there is no place for your logo, brand colors, aesthetic, and so on. This can create a lost opportunity when it comes to developing a sense of company culture and community.
- Only accommodates certain types of businesses: Due to the “shared” experience of a coworking space, there are certain types of businesses that should consider alternative options. Essentially, coworking offices are designed for office employees. For example, companies that need a large work area (such as manufacturing and production businesses) and those working in confidentiality (such as law offices) should think about leasing or purchasing their own space.
Coworking spaces can be an excellent asset for specific individuals and small businesses. However, companies with more than thirty in-office employees may be restricted by sharing office space.
We recommend coworking spaces primarily to freelancers, small businesses, and certain startups due to the benefits of integrated office management and in-house networking opportunities.
To quote the U.S Chamber of Commerce’s recommendation, “If your business is fairly small, or you are working alone, you may find coworking spaces to be more beneficial.”
- Privacy: Having your companies own office removes many scheduling conflicts of a shared space for you and your clients. Privacy enables more professional environments that may offer fewer distractions and greater confidentiality.
- Customization and branding: A traditional office space allows you to customize your workspace completely. This enables the opportunity to use design to your advantage. Essentially, you get to design your space to accommodate your business’s unique needs, values, and workflows.
- Community and culture: Having your own office space allows more than just personalizing its design and brand- it allows you to be more intentional through the effects of its design. In today’s environment, many organizations are struggling to create a sense of place, belonging, and community.
- Inclusive amenities and market rates: Current market rates for commercial real estate are significantly low, and landlords are eager to provide upgraded amenities and rich tenant improvement incentives. If there is a time to find the perfect lease space for your Portland business, it is now.
- Office management: Hosting your workspace requires ownership of office management tasks. For most businesses with greater than ~30 employees, management tasks will most likely need a designated office manager. However, outsourcing your office management tasks can be a very cost-effective solution.
- Long-term commitment: Unlike coworking spaces, lease terms often include upfront costs and long-term commitment. Although tenant-improvement (TI) allowances are great, most new leases require some upfront furnishing and equipment costs. Standard lease terms typically run from 3 to 7 years.
For businesses with over 30 employees, having your own office space may be a better fit. Traditional office spaces enable you to use design as an opportunity to drive home your organization’s values, brand, and create a greater sense of community.
For more information, we offer a complimentary workplace consultation to help you determine what your team requires to create a productive environment that fosters community.
In need of assistance?
DESIGN+BUILD’s team of workspace strategists and commercial real estate professionals can help you create the most successes out of your physical space. If you’re unsure which option is best for you, contact us! We’re happy to help.