Is It Worth to Invest in Coworking Spaces?
In this modern day and age, coworking spaces are starting to rise up and take their places in busy areas in the city. Why is this so? What is the big deal with coworking spaces? And why do potential real estate investors look towards coworking spaces for their investments?
Before anything else, let’s talk about the humble coworking space. A coworking space is an area which professionals of any age or background can work at an office-like environment. In today’s age, people are looking to start their own businesses, downsize their office, or work as freelancers without a physical office in order to save money.
“Going to a coworking space can allow you to work at an office-like environment and not spend as much as you would, when you rent out a whole office space to yourself or your small business”, said Scott Rubinstein, owner of Local Office, coworking shared space in Houston, Texas.
On another note, people right now are also looking to move to more peaceful residential areas outside the bustle and hustle of the city. With more and more professionals living outside the city, there is a higher demand for coworking spaces that can offer comfortable work environments.
This can be a real time saver in terms of travel for working professionals. Coworking spaces aren’t just a passing fad but will continue to grow more and more as more businesses move towards the digital modern age.
Looking into a real estate investor’s point of view, it is important to understand that coworking spaces aren’t just a fad, but something that can prove to be really beneficial in the long run. Many real estate agents hate the idea that the traditional commercial and retail real estate market is being destroyed by the popularity of rented off office spaces.
Many real estate investors however look at coworking spaces as a way to make money. Coworking spaces in general can give you up to 2 or 3 times more revenue per square foot over a traditional commercial space. A commercial real estate investor can increase their income by turning their vacancies into coworking spaces.
For example, a landlord who is renting an area to a coworking operator could charge $40 per square foot, and the coworking operator can then lease out the area for $80 per square foot. Coworking spaces can also be used to increase foot traffic in certain areas.
If you are a commercial real estate investor, purchasing properties near each other can benefit from the right businesses. Empty spaces can be turned to coworking spaces to bring more people in the area which, in tern, can attract more potential businesses that are looking to set up shop in those areas.
The possibilities are endless when it comes to commercial real estate investing. Lastly, the timing to invest in coworking spaces can’t be any more perfect than right now. Projection shows that by 2030, millennials will make up 75% of the world’s workforce making coworking spaces the best real estate investment you can make at this moment. Coworking spaces are definitely becoming the best way to invest in commercial properties.