Make Strategic Facility Management a Focus

By Shahar Alster
Chief Executive Officer & Co-Founder

Strategy is important in everything from board games to business planning. In the latter, strategy is often the key to success—a concentrated effort toward a measurable goal. If your goal is to leverage facilities into business success, strategic facility management is paramount. It’s a combination of facility management and facility planning, stitched together with a set of clear-cut outcomes in mind.

Strategic facility management is all about focusing on the long-term. What can you do to your facilities today that’ll pay dividends next quarter, next year, or in the next decade? Applying strategy to facility management gives purpose to the workplace, making it a focal part of broader company initiatives. But, like all strategies, one involving facilities management needs clear motive.


Manage with a set of goals in mind

Strategic facility planning starts with clearly defined goals. What are the broader goals of the company and what role do facilities play? Or, what’s important to your business that’s impacted by facilities. Goals can take many forms. Examples include:

  • Improve cash flow to support the expansion of the business
  • Establish the company as a steward for a cause
  • Attract and retain top-level talent
  • Improve the company’s eco-friendly profile
  • Make the transition to a more flexible, remote work arrangement

Decide what’s important to your business. Then, link it to facility management. For example, if your primary goal is to attract and retain top-level talent, consider the workplace’s role and make a list of strategic focuses:

  • Offer perks that entice candidates to work for you
  • Make your facilities centrally located to a diverse workforce
  • Leverage the workplace as part of company culture

These three goals funnel upward into the greater goal of attracting and retaining top talent. They’re all facility-related, serving as focus areas for workplace improvements. As you hone in on each, the greater goal of luring prime workers benefits. This is strategic facility management—action with a greater goal in mind.

Implementing strategic facility management

Strategic facility management takes discipline to execute. According to the International Facility Management Association (IFMA), there are four steps to implementing a successful strategic facility plan:

1. Understand

Understanding strategic facility management hinges on knowing what elements dictate it. What are your goals? What is the capacity of your facilities to support these goals? Do you possess the resources—time, money, manpower, stakeholder buy-in—to make change happen? Is there a timeline or a clear path to execution? This initial phase helps you take stock of the desired concept, which gives it context. It’s important to understand the strategy before attempting to execute it.

Read: Facility management software ROI.

2. Analyze

This is the experimental and understanding phase of strategic facilities management. By now, you should know the goals and have a comprehensive grasp of the situation, which allows you to turn your attention to the how of executing your strategy. There are several experimental and analytical tools involved in building out a facility strategy. Scenario planning is a big part of facilities management, as is systematic layout planning. A Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis helps qualify certain focus areas. Combined with Brainstorming and Strategic Creative Analysis (SCAN) sessions, ideas for facilities improvement should begin bubbling to the surface.

3. Plan

A strategic facility space plan is built on conclusions formed in the understanding and analysis phases. Once you know what you’re working toward, and the steps needed to get there, you can begin constructing the roadmap. Often, this is the physical plan a facility manager presents to the C-suite for approval. It outlines core facility changes and the reasons behind them. It lays out action plans for making said changes. It puts everything on a timeline, delegates duties, and qualifies the metrics used to measure success. Think of it like a business plan specifically for the workplace—it should be a comprehensive plan detailing the path to success.

4. Act

You have a plan in-hand and approval from leadership. All that’s left is to act. Strategic facility management needs leaders who understand the vision—both at the facilities level and how it contributes to broader business goals. These leaders must execute changes according to the strategic facilities management plan, then document improvements and changes to understand the effect they’re having on the business. As the workplace shapes itself into the asset it’s meant to be, you should measure its impact on finances, personnel, culture, and other metrics that align with your goals.

Make strategic facility management an ongoing focus

What is facility management without goals to focus on? Even after you reach your strategic facility management endpoint, it’s important to continually redefine it. Ask yourself how facilities can improve and lend themselves to larger business goals.

Take the time to consider the ramifications of investing in facilities—whether it’s a monetary push or new strategy. Keep the approach strategic and the outcome is sure to reflect the move toward clear, well-defined business goals.

Keep reading: Innovative ideas for facility management.

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A Crash Course in Stack Planning

By Noam Livnat
Chief Product & Innovation Officer

Visual interpretations of data are almost always easier to understand than pure numbers. Graphics provide context for variables better than reading them line-by-line. That’s often the reason facility managers use stack planning software to visually coordinate facilities and plan workplaces.

Stack planning is a useful tool in understanding the cumulative workspace based on its makeup. It’s often a quick and easy way for facility managers to understand and experiment with different workplace changes. Stack planning is key for scenario planning, whether you’re adding a few desks or completely rearranging a floor.

What is stack planning?

A stack plan is a visual representation of the workplace. It shows total square footage, with occupied and unoccupied areas. Occupied segments are further broken into individual business units that show how much space a given department takes up. Stack planning is usually represented as a bar graph, pie chart, or blocks.

Stacks themselves represent chunks of data. Usually, a stack shows one floor of a building and the different space allocations within it. Companies occupying several floors will layer stacks to see space distribution and utilization across levels. For larger companies, stacks may also represent locations. A stack generally corresponds to the scale of the data being investigated.

Stack planning can represent space allocation in many different ways. Most often, it’s by department or business segment. However, stack planning may also show a floor plan’s workstation makeup or the number of employees by grouping. The theme is always the same: the sum of the parts totals the whole.

What’s the purpose of stack planning?

Stack planning—also called stack scenario planning—helps facility managers understand the workplace at a glance for better decision-making and improvements. Rather than deciphering space allocations in a complex spreadsheet, facility managers get visual context of floor plans. For example, it’s easy to see that Sales occupies double the space of Accounting, or that collaborative workspaces take up a third of your available space.

In essence, stack planning is a macro tool. It’s the big picture of your facilities—how they’re allocated, organized, and utilized. By understanding the cumulative, facility managers can dig deeper into areas that require improvements, change, or a complete rework, and understand how those decisions affect the whole.

Problems solved by stack planning

With a stack plan in hand, facility managers can progress to scenario planning. Visual data, conceptualizes adjustments that, ultimately, benefit the entire workplace. Stack plans show how to:

  • Consolidate departments scattered across multiple floors
  • Determine optimal space utilization
  • Reduce total lease cost by consolidating stacks
  • Create strategic, synergistic department alignments (ex. Sales and Marketing)

Scenario planning is a lot like solving a logic puzzle. The bigger the company, the more variables. It boils down to understanding how to best configure the parts to make a more complete whole. Here’s an example:

  • 1st Floor: 80% occupancy—Sales (60%) and Human Resources (20%)
  • 2nd Floor: 60% occupancy—Sales (30%), Marketing (20%), Conference Rooms (10%)
  • 3rd Floor: 40% occupancy—Marketing (10%), Accounting (20%). Executive (10%)

Let’s say the goal is to reduce lease costs by consolidating departments:

  • 1st Floor: 100% occupancy—Sales (60%) + Sales (30%) & Conference Rooms (10%) from the 2nd floor
  • and Human Resources (20%)
  • 2nd Floor: 60% occupancy—Marketing (20%) + Marketing (10%) + Accounting (20%) + Executive (10%) from the 3rd floor
  • 3rd Floor: Vacant

In this example, the company is able to vacate an entire floor, with space to spare on the second floor. Synergy is achieved by grouping once-disparate departments—Sales and Marketing—on the same floors. That creates cohesion across the business, with room to grow.

Stack planning and digital facilities management

Used alongside other digital facility management tools, stack planning provides important insights into facility utilization. How much space is dedicated to different departments? What’s the cost of housing these departments? What types of workstations are present on each floor? These insights inform better decision-making for facility configurations and space utilization. The stack plan provides a visual understanding of space. From there, it’s the responsibility of a facility manager to optimize and streamline it.

Keep reading: Make every space count with space Management software.


What are the Economic Benefits of Coworking?

By Reagan Nickl
Enterprise Customer Success Senior Manager

Businesses with remote employees, contract workers, or traveling team members are likely familiar with coworking spaces. Coworking memberships are now one of reimbursable items for many companies. And, as more companies are willing to pay for them, the economic impact of coworking continues to grow.

In an economic sense, coworking spaces are much more than a collection of hot desks. Coworking spaces are businesses in and of themselves, with direct ties to the local community, area professionals, and ultimately, the companies reimbursing employee memberships. These connections make coworking an important driver of local economies. Every coworking membership impacts the surrounding community by:

1. Supporting the local workforce

First among coworking benefits is support for the local workforce. Because they’re open to anyone, coworking facilities support remote workers from all backgrounds—the budding freelancer, the hardworking gigger, the part-time office worker, and anyone else doing work outside of a traditional office. Economically speaking, giving people a place to work bolsters local employment.

2. Assisting the mobile workforce

The economic impact of coworking extends beyond workers in the local economy. It’s also valuable to anyone visiting the area—a CEO from an out-of-state company in town for a meeting or a young professional in town for a job interview. Anyone temporarily in the area who needs a place to work stands to benefit from coworking. And when visitors use coworking spaces, they’re likely spending money at local restaurants, hotels, and other businesses. Coworking supports professionals far from home, making the city they’re in seem even more accommodating and welcoming.

3. Bolstering local small business

The ripple effect of spending money is another reason why coworking space is important. Not only are people paying for space, they’re also putting themselves in a position to spend money at nearby businesses. A cup of coffee on the way to the coworking space. A sub sandwich for lunch. An umbrella from the corner bodega. Any money spent before, during, and after time at a coworking space is money they wouldn’t have spent if they stayed home to work.

4. Connecting area professionals

Economy grinds forward on the gears of every new business transaction. One of the best ways to get business done is to put people in the same room and let the deals make themselves. That’s exactly what coworking does. A graphic designer and a copywriter can come together on a big project for a third-party client. A business consultant may meet with a new startup to advise them on their investor pitch. Coworking connects professionals to expand their capabilities, resulting in more business for more customers. It translates into positive economic growth.

5. Improving community relationships

Coworking spaces double as meeting areas. After hours, a coworking space might become the venue for a professional mixer or a nonprofit board meeting. On the weekend, it might host a fundraising event. The flexibility of coworking spaces make them valuable community assets. Local entities can do more and engage more, which has positive effects on the economy.

6. Aiding local startups

One particular group riding the tails of the coworking movement is the startup community. They benefit from the low-cost, flexible nature of coworking. And, because they’re enabled to succeed in their infancy, these companies also deliver a positive return. Coworking allows them to grow and flourish, and when they do, they bring new dollars, new employment, and opportunities to the local economy.

7. Coworking is more than a desking solution

Coworking is about desks in the same way a grocery store is about food. Sure, that’s the main product offered, but the ramifications of that business and its products reach far into the surrounding community.

People shop at the local grocery store to feed their families. They get to know their local cashiers as members of their community. These same people go to a local coworking space and support that business as they work to support themselves. They meet other working professionals, friends and neighbors in different careers, sharing the same space. Regardless of whether they’re passing each other at the grocery store or sitting one desk over in a coworking space, the benefit is clear—business is one of the pillars of a strong community.

As the number of working spaces around the world continues to grow, so will the economies and communities they support. Giving people a place to work means giving them a reason to engage with their community—whether that’s spending money at a local business or networking with a nearby professional.

Keep reading: Who Uses Coworking Spaces?


Why is Coworking Space Important?

By Tamara Sheehan
Director of Business Management

As more companies embrace remote work options, coworking spaces help them fill a unique void. They look like an office without the rigidity of one. Coworking offers social opportunities, networking prospects, and general human interaction in place of the isolation of working strictly from home. There’s a lot to love about coworking. But why is coworking space important? What impact will it have as the workforce continues to evolve?

Coworking isn’t only about accommodating remote workers. It’s important to commercial real estate because it benefits both companies and their employees equally. Coworking takes the most important and expensive business cost—the workplace—and turns it into a service. The space-as-a-service model unburdens balance sheets and creates workforce flexibility.

Outside of cloud computing technologies, coworking stands to be the biggest driver in the next evolution of how, where, and when we work.

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A quick look at coworking space pros and cons

The reason behind coworking’s growing importance has to do with its balance of benefits vs. drawbacks. Coworking space pros and cons are simple and equally proportioned, but the value of benefits significantly outweighs any drawbacks. Take a look:


Coworking benefits both companies and employees. For companies, it’s all about cost savings. On the employee side, it’s about having the freedom to work in a way that’s best for every individual. As the demise of the traditional workplace creates more remote workers, benefits will increase:

  • Allows employees to work remotely in a professional setting
  • May prove more cost-effective for businesses, opposed to a larger lease
  • Improves networking opportunities for mobile workers
  • Zero maintenance involved in facility upkeep
  • Pay-as-you-go and membership models offer flexibility to professionals
  • Diverse space types, from individual workstations to group spaces
  • Accommodates almost all work hours


Most coworking drawbacks revolve around the openness of the space. Diverse people working in an equally diverse space means distractions. Moreover, there’s a general lack of hierarchy and order, which takes some getting used to for both companies and employees. The good news is that many of coworking’s downsides simply require new habits and familiarity to overcome.

  • Lack of permanence and dedicated personal space for traditional employees
  • Lack of privacy and excess of noise and distractions can be hard to cope with
  • Potential for personality conflicts between random individuals
  • Cost prohibitive to companies with rapidly growing space needs
  • Issues stemming from decentralized workers and lack of direct oversight
  • Desk availability isn’t always guaranteed (even with reservations)

Are coworking spaces worth it? As demand for flexible work environments grows, commercial real estate costs rise, and employees enter the remote workforce, coworking becomes even more important. Based on the breakdown of pros and cons, many companies see them as an invaluable part of their business strategy.

Keeping pace with an evolving workforce

The benefits of coworking add up to something pivotal for the world’s workforce. It’s an opportunity to reinvent the workplace, giving workers the stability of a traditional work environment, and the flexibility inherent to remote work. It’s quickly becoming the new standard.

Work is becoming something without borders or barriers. People work in shifts around the clock, 24 hours a day to earn a living. What’s more, anyone can work from anywhere to get their paycheck. Coworking supports every worker, everywhere, no matter their job description or duties. If they can work remotely, they benefit from coworking; and so do the businesses they work for.

The space-as-a-service model changes the way companies function, too. By taking the most expensive element of work and turning it into a service, coworking companies maximize the value of physical workspace. Companies spend no time worrying about how to arrange desks or what their space optimization is. Coworking providers do this for them. This leaves companies free to focus on investing in their people, instead of space. In turn, employees get the tools and assistance they need to do their jobs better.

Coworking creates flexibility

If there’s one trait prided above all in the workforce today, it’s adaptability. Being flexible in how, where, and when work gets done, without compromising on the quality and efficacy of that work, is invaluable to companies. Coworking spaces enable this flexibility, allowing more of the workforce to be adaptable to changing demands. In lieu of a traditional workplace, companies are realizing how vital coworking is in enabling their employees. It’s hard to overstate the importance of coworking in the shift to a more remote, autonomous workforce.

Keep reading: Why Use Coworking Space?

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What’s the Average Size of Coworking Space?

By Jeff Revoy
Chief Operations Officer

When you’re in the market to buy a house, one of the major deciding factors is square footage. Not just total square footage, but the dimensions of every individual room. Square footage has a role in determining everything from the value of your home to how you’ll live in it.

Space is important, which is why square footage is also the chief factor in gauging the average size of coworking space. If people don’t have enough space to work, they’re not going to see the value in their coworking membership.

Like a home, coworking space covers two metrics: total space and individual space. Total available square footage informs how to proportion individual spaces and what desking arrangements are suitable for each particular area.

Making decisions about individual vs. total space comes down to understanding averages. How much space does the average person need? How much space, on average, does this desking arrangement require? Finding averages unlocks options.

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A look at the full facilities

Before we can understand coworking space ratio, we need to know the total space of the facilities themselves. How much space is available determines how it can be split up and organized across different desking arrangements.

According to Coworking Insights, the average size of a coworking space in North America is 9,799 sq./ft., with an average capacity of 100 people. This equates to roughly 100 sq./ft. per person. On a grander scale, however, it makes budgeting different spaces easier.

If a benching concept requires an average of 1,000 sq./ft., the average coworking facility can accommodate nine separate benching areas, with space to spare. Likewise, if a four-desk cluster averages 500 sq./ft., the average coworking space can accommodate six clusters and six benching areas. It’s up to coworking managers to put together the right facilities within the parameters of total available square footage.

Average square foot by workspace type

To complete a coworking floor plan, it’s crucial to understand the different desking concepts and the average space they need to be effective. For example, the average coworking desk size will vary greatly from the dimensions of a collaborative workspace. Knowing the average size requirements for each space type makes it easier to allocate total available space. Here are a few examples of average workspace type, courtesy of The Balance Small Business:

  • Private workspaces require an average of 150 sq./ft.
  • Open workspaces demand an average of 125 sq./ft.
  • Conference rooms need 50 sq./ft., plus an additional 25 sq./ft. per seat

Using this information, coworking operators can piece together a robust picture of space allocation. Twenty hot desks takes up 2,500 sq./ft. A six-person conference room translates to 200 sq./ft. The individual cogs of a coworking space come together to shape the whole.

Average space size as part of a whole

Average workspace requirements are fixed. The actual space allocated to a type of desking concept is variable. For example, a conference room may demand 50 sq./ft. plus an additional 25 sq./ft. per person, but that doesn’t mean every conference room has the same space demands. A four-person room is much smaller than a 10-person room, which means it takes up less overall space.

It’s also important to consider average workspace as a function of the spaces around it. A shared office layout with 10 seats may require 1,250 sq./ft. based on average seating, but it could easily be 1,500sq./ft. if the room already has these dimensions. Or, it may be 1,250 sq./ft. that blends into a nearby zone of desk pods, where ~150 sq./ft. are shared between the two zones.

Considering average space as part of a whole reminds us that there’s wiggle room in how we use space. Think of the average as a best practice example, then understand that deviation above and below is okay—to a degree. Giving someone a private workstation that’s 125 sq./ft. instead of the recommended 150 sq./ft. likely won’t make a huge difference.

Allocation varies across coworking spaces

The average space required for people and different desking arrangements isn’t absolute. It’s meant as a guide to designing cohesive coworking spaces. Deviating above or below the average is okay, so long as it’s done to better accommodate people.

A small half-bath in a home is more valuable than a walk-in closet, even if both fit in the same space. The concept is the same for coworking. Turning a 200 sq./ft. workspace into two desks may fall short of the average, but it’s worth it to accommodate another person.

Understand your space. Know the averages. Play with allocation. Every coworking space will be different, which means fitting pieces of the puzzle together to make sure everything fits.

Keep reading: 5 Ideas for Coworking Space Design.

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Quick Facts from the Coworking Space Industry

By Shahar Alster
Chief Executive Officer & Co-Founder

The coworking space industry is growing by leaps and bounds. A growing remote workforce and rise of the gig economy are pushing the demand for workspaces to new heights. It’s not just happening in the United States, either. The coworking trend is a worldwide phenomenon. Wherever people work, there’s coworking.

Though still an emerging industry, coworking has surged over the last decade. In the last few years, coworking has reached the mainstream. Coworking statistics show strong advancements across important metrics, such as total industry growth and demand, customer trends, and profitability.

Look at some of the eye-popping statistics surrounding the coworking boom and what they mean to the future of commercial real estate and the workforce.

A look at industry fundamentals

Fundamentally, the coworking industry is fascinating. It’s a strong departure from the traditional office concepts, yet serves the same role for the people using it. While coworking operates outside the bounds of usual workplace governance, it’s still held to some of the same rules.

Things like the average size of coworking space must correlate to traditional office metrics. Likewise, variables like occupancy and workspace type play a big role in the success or failure of a coworking space. Consider these general industry facts that paint a picture of coworking:

The growth of coworking

The space-as-a-service business model is growing rapidly. Coworking growth is evident in nearly every relevant metric, including the number of new leases, number of seats, dedicated square footage, and growth rate. Tailwinds propelling coworking growth include the increase in remote workers, rise of gig economy, decentralization of work, and prevalence of startups and small business cultures.

This model originated about a decade ago, but has seen breakneck expansion over the last three to five years. Forecasts show the next few years are likely to see even more emphasis on coworking as the model for adapting work styles.

Coworking’s social impact

The rise of coworking hasn’t strictly been a benefit to commercial real estate. There are also rippling social advantages to coworking. As businesses shift away from traditional office concepts, many people miss working alongside peers. Coworking allows for more contact with other professionals from different backgrounds.

Many coworkers use these unique workplaces to increase their social and professional circles. Others see coworking as a lead-generation opportunity. Partnerships form and referrals mount. Coworking is as much a professional networking opportunity as a space to get work done.

  • 82% of members say coworking has expanded their professional network.
  • 64% of members can trace a referral or business opportunity to a coworking connection.
  • 89% of people say they’re happier while working after joining a coworking space.

Global coworking stats

How big is the coworking market? Though difficult to quantify, coworking appears to be a part of a broader, global paradigm shift. In major global metropolitan areas, coworking is fueling massive property grabs and changing the work habits of urban professionals.

Coworking is poised for continued growth in the United States, Great Britain, Asia-Pacific, and other hubs. On a global scale:

Coworking is the new way to work

The perfect storm of rising real estate costs and a cloud-enabled workforce set the stage for the space-as-a-service business model. Now, coworking isn’t just here to stay—it’s here to thrive. Demand for coworking spaces will likely increase in the coming years. As remote workers realize the benefits of coworking, so too will the companies that employ them. Coworking as a business model stands to benefit as the solution to new-age workspace demands.

Keep reading: Why coworking space in the modern workplace?


How to Improve Coworking Space Productivity

By Reagan Nickl
Enterprise Customer Success Senior Manager

One of the biggest knocks against the coworking model is that it’s filled with distractions. Critics claim it’s hard for people to concentrate, there’s no privacy, and the temptation to fall off-task is too great. While there are some merits to these arguments, they’re far from absolute. There isn’t any real data to support a drop-off in coworking space productivity. Most coworkers agree, they do just fine when it comes to staying on task.

People new to remote work may struggle the most to be productive. Not because of the coworking environment, but because they haven’t yet developed the habits to work independently and with accountability on their own schedule. In fact, spending time at a coworking space may help form good habits and tendencies, since it bridges the gap between pure remote work and an office environment.

Coworking operators can help new and seasoned workers alike stay on task by cultivating a productive environment. Space planning and management, experiential design, and social networking opportunities all play a role.

1.Productivity through space planning

A workplace should enable workers to accomplish the tasks set before them. By working outside a traditional office, remote employees need to make their own. Coworking space design is critical for creating a productivity-centered option for remote workers.

To be productive, people need a few basic things. Good space planning covers them all:

  • Space to work comfortably alone or with others
  • Noise control for better focus
  • Access to electrical outlets and Wi-Fi
  • A well-lit, clean, and organized environment

The first step is allocating the right amount of space for each desk or workstation type, followed by arranging seats with proximity in mind. By ensuring each seat meets the above criteria, productivity should flourish.

2. Productivity by way of space management

It’s nearly impossible to be productive with constant interruptions. Coworking productivity stems largely from minimizing disruptions. That takes good space management. Workplace managers can mitigate disruptions by determining where distractions arise and creating workspace options based on an individual’s need for quiet, focus, and privacy. Good ways to reduce distractions and improve productivity include:

  • Ensuring a single check-in point to prevent aimless wandering and disruptions
  • Setting and enforcing shared space etiquette for individuals and groups
  • Recognizing the demand for different space types and capacities
  • Managing facilities upkeep and maintenance demands

Proactive oversight minimizes barriers between occupants and productivity. Avoiding a desk dispute or keeping the lights on in a room reduces the chance of distracting people trying to work there.

Read more: What is coworking? A look into the future.

3. Creating productivity through experience

There’s a reason cubicles are creeping toward extinction. They’re boring and uninspiring—as much a damper on productivity as critics claim coworking to be. Coworking should inspire productivity and motivate people with:

  • Personality and unique appeal in the form of décor and amenities
  • Value-add amenities like food, entertainment, or technology
  • Personalization, such as special email addresses or membership perks
  • Events and hours of operation accommodating to all work schedules

Not only does a coworking space need to give remote workers a reason to work outside their homes, it should provide the opportunity to be productive when they do. Given the opportunity to enjoy something beyond their desk at home or a boring office cubicle, most people will embrace and embody what coworking has to offer, channeling it into their work.

4. Networking improves productivity

Many remote workers turn to coworking for the social experience. They may not miss being chained to a desk at work, but they’re likely to miss talking with coworkers and bonding over shared interests. A coworking space that delivers social opportunities will impact productivity. Examples include:

  • Central social areas like a coworking break room
  • Theme days or business model to attract likeminded patrons
  • Open environments where professionals can commingle
  • Mixer events or community functions designed to bring people together

Making a new business connection or finding a friend in a coworking space is a form of productivity. And on those days when you talk to no one, the energy of people working nearby spurs your own productivity.

5. Productivity by design

Productivity waxes and wanes depending on many factors—not least of all the energy and focus of the person working. Aside from minimizing distractions, coworking spaces should energize and intensify focus. Give people the right spaces, a unique environment, and a strong social element and coworking becomes a productivity driver.

Where drab white walls and the sound of a ticking office clock can drain productivity, the buzz and appeal of coworking might ignite it!

Keep reading: Are coworking spaces worth it?


How Does Coworking Space Work?

By Reagan Nickl
Customer Success Senior Manager

To the uninitiated, coworking spaces may seem like disasters waiting to happen. A space where anyone can walk in at any time and pay a small fee to use a desk doesn’t exude structure and order. Moreover, clumping a diverse group of working professionals in one big, shared area seems like a recipe for friction. So how does coworking space work? What allows it to be as successful as it is today?

Despite a lack of outward-facing structure, coworking is actually highly organized. Operators face many unpredictable, uncontrollable variables. So, they create a framework that supports optimal space utilization and management. It feeds into a viable business model and a great concept: A space for people who need it and a place where work gets done.

Coworking in a nutshell

What is coworking space? The simplest definition is “space supporting a group of people from different companies, working independently or collaboratively.” Coworking spaces are open to the public, aside from any membership rules.

Coworking goes beyond the space itself. It’s a philosophy rooted in bringing people together to get work done. Freelancers may work alongside remote workers while gig workers share a space with traveling professionals. No matter the background or the job, coworking environments provide people with a casual, professional space to focus, as well as networking opportunities and a social element.

Coworking is about more than good vibes and accessible office space. Space-as-a-service is a business model, which means it needs to turn a profit. How do coworking spaces make money?

The membership model

Like a gym, coworking spaces sell memberships by the month or year. This has two chief benefits. First, it creates a steady, reliable cash flow through recurring auto-charges. Second, it provides a baseline for determining working capacity.

Most coworking spaces will sell monthly memberships to satisfy space capacity—often in excess of 100%. The likelihood that everyone with a membership will show up on the same day, at the same time, is marginal. To that end, a coworking space with 200 seats may sell as many as 250 memberships (125% of total capacity), with the expectation of seeing 150 members at any given time (75% capacity). It’s a balancing act based on space utilization trends and membership figures.

Usually, memberships sell at a steep discount to one-time users—the goal is to entice one-timers to buy full memberships. Monthly memberships may cost $99, while day passes may run $20. Theoretically, they could use the space every day for ~$3 a month instead of paying $600 for individual day passes. Memberships may also come with perks, like access to faster Internet or seating by request.

The walk-in model

Not everyone wants or needs a coworking membership. Someone using the space only a few times per month will opt for the pay-per-use model. It’s harder to predict demand from these users, but revenue is higher on a per-person basis.

If a coworking space expects 75% occupancy by members at any given time, the remaining desks serve two purposes. First, they accommodate an influx of other members. Second, they serve walk-in patrons. The walk-in model has tiers in and of itself—pricing by time, workspace type, or amenities. Someone may pay $60 for eight hours of desk time, high-speed Internet, and access to a space with a view. Another person may pay $20 for six hours of desk time and standard Internet speeds. The goal is to fill unoccupied desks at a higher margin.

The chief problem with walk-ins is they’re unpredictable and variable. If a coworking space is 100% occupied, there’s no choice but to turn away a walk-in—even if they’re willing to pay 20 times the membership price. That said, walk-ins can be frequent customers, even if they don’t opt for a membership.

Organized seating and space management

It’s hard to explain coworking without mentioning the infrastructure required to seat every person using the space. This is the heart and soul of what makes coworking successful.

Regardless if a person is a member or a walk-in, they both check-in with an admin. That person logs them in, assigns them a desk, and provides the relevant details they need to get to work. This provides a real-time picture of occupancy and space utilization. It also highlights relevant information, such as the number of members vs. walk-ins, daily revenue, occupancy time left in certain spots, and types of spaces available.

Without this centralized management system and use of coworking software, coworking spaces don’t work. There’s no way of knowing who’s where, for how long, or what spaces are open.

Finding the right balance

Coworking spaces work when operators find the right balance of members and space allocation. The coworking model provides flexibility for users, which means it needs to be inherently flexible itself. Accommodating people on-the-fly is a product of having a well-designed, well-managed system for space management and the means to connect people with seats.

Keep reading: Who uses coworking spaces?