Coworking spaces present loads of opportunity
The very nature of work has changed, and flexibility is key. The IWG Global Workplace Survey for 2019 found that 92 per cent of employees can be more productive through flexible work. To facilitate that flexibility, coworking spaces have emerged to provide everything from monthly private office leases to meeting rooms by the hour or office rentals a few days a month. These spaces offer a variety of amenities to attract renters. Nine out of every 10 businesses in Australia employ fewer than 20 workers, many of them startups looking for a small space. By 2030, a full third of office space nationwide could be flexible.
The average total contract value near $17,000, according to Office Hub’s extensive Australian Coworking Market Report.
“The greatest demand for commercial space comes from small businesses, startups, and businesses expanding with small teams into new markets,” Office Hub founder Grant Philipp told Commercial Real Estate. “The time taken to fill the empty space is substantially reduced in line with the often urgent needs to occupy space by the incoming business.
“The days of spending thousands of dollars fitting out conventional space, signing long-term contracts and coming up with six-month bonds are over.”
Philipp expects the market for coworking space to keep growing and diversifying over the next couple of years. Alongside big players such as Victory Offices and boutique shops such as Christie Spaces, there’s an opportunity to break into the space as a franchisee.
Hit the Ground Running
Venture X have been at the forefront of the coworking industry for years. Combine their expertise with the resources of parent company United Franchise Group, and you have a recipe for instant success as a franchisee. You’ll learn the ropes at an immersive full-week training in Florida then have on-site training in your own coworking space from the corporate support team to make sure you’re ready to open. Ongoing support and innovative multichannel marketing will keep enquiries headed your way and help you solve problems as they arise.
Total investment is between $1 million and $1.5 million, including the franchise fee of $84,500. Franchisees also pay a royalty of 6 per cent on their gross monthly sales. Qualifying franchisees may be able to obtain financing. Venture X say their best franchisees had no prior experience in coworking spaces. It could be the perfect way to help other new businesses grow along with yours.
IWG Australia head Damien Sheehan wants to franchise 100 new Regus coworking centres in the next five years. “It’s an exciting opportunity for landlords and real estate funds, who rather than build their own coworking business can plug in and play the Regus model and tap into double-digit returns,” he told AllWork.
Regus is the world’s largest supplier of coworking spaces, and a big draw is that renters have access to centres in nearly 900 cities across 120 across. There are already 79 centres in Australia. “We are focused on expanding our footprint with franchise partners to cater to the growth in the market as it really does become mainstream,” Sheehan told Inside Franchise Business. “With the right partner or partners, we believe we can commit to 100 centres as a minimum in the next five years. So, in total, our portfolio will consist of 150 to 200 new centres, when taking into consideration what the market can absorb.”
IWG, owners of Bizdojo and Spaces in addition to Regus, have launched a franchise programme in New Zealand as well, with aims for more than 100 coworking spaces spread throughout Auckland, Christchurch, Dunedin, and Wellington. “We want to accelerate our growth faster than we have been doing,” IWG New Zealand country manager Pierre Ferrandon told Stuff.
Fitting a Need
Whether you become a coworking space franchisee or not, they can be exactly what you need in terms of office flexibility. If you’re franchising a restaurant or fast-food chain, you might be in between locations a lot and one of your stores might not be the best place to hold business meetings. With the variety of spaces and times coworking offers, it might be the perfect solution for the few times a month when you need a genuine office and boardroom.
The franchise sector in Australia is worth nearly $200 billion and counting, and many of those employ a few people on the management staff with similar flexible office needs. Even if you already have a successful franchise business, you might consider getting into the coworking space given the prevailing trends in how we work.