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Amsterdam, Stockholm, Helsinki and Dublin are among the
major cities featured in a new research report from Cushman & Wakefield
into the coworking and flexible office sectors, which pinpoints future demand
and the next likely growth hotspots across Europe.
Coworking’s rapid expansion in recent years has quickly disrupted
global office markets. The report charts the current state of the sector, the
emergence of flexible working space across continental Europe and where future
growth will occur.
Cushman & Wakefield currently tracks 11 million square metres
of coworking space, serviced offices and flexible workspace providing a
critical insight into the sector. London is the most active city with the
largest total coworking stock (1.1 million sqm) in Europe, accounting for 4.6%
of the overall office market. Indeed, London and New York account for 22
percent of all global coworking stock.
However, the report also looks at where the model might expand
next across the continent and which cities display the right combination of
factors to support the move away from traditional leasing models to coworking.
Cushman & Wakefield’s EMEA Research & Insight team
has for the first time compiled a proprietary European Coworking Hotspot Index
of 10 key markets. More than 40 cities were initially analysed and ‘scored’
using quantifiable real estate and economic measures which have supported the growth
of the flexible working segment covering scale, business environment, people
and catalyst factors.
European Coworking
Hotspot Index (Source:
Cushman & Wakefield Research)
Established office markets such as London and Paris feature
prominently at the top but the list also shows that cities such as Stockholm
and Dublin score highly and have great future coworking prospects. These
factors mean operators and landlords can be more informed as to what offer is
most likely to succeed in these cities in the future.
Report
author Elisabeth Troni, Cushman & Wakefield’s Head of EMEA Research &
Insight, said: “Our
European Coworking Hotspot Index adds a twist to the traditional office market hierarchy
and shows the disruptive potential of this fast-emerging sector. However, coworking
growth potential also reveals a wide range of dynamic factors underlying a
city’s office market. In particular, the growth in coworking represents a clear
shift in employment towards digital and technology-based sectors and away from
traditional financial services.
“The
new growth sectors of the digital economy are more nimble – and comfortable
with flexible working practices. This change in tenant preferences for flexible
working is shifting the balance of power towards the tenant as the landlord
looks to adjust and adapt their strategies in response. With a better understanding of city-level demand drivers for coworking,
operators and landlords can be more informed as to which type of workplace offer
is most likely to succeed in cities across Europe.
“Our analysis
shows every city is different. We expect demand for coworking to be strong in our
featured hotspot markets and would recommend that coworking operators and
office landlords and investors alike adopt a proactive strategy to managing
their response to these dynamics.”
The report also states that many other
cities across Europe, which fall outside the top 10 of the index, could nonetheless
emerge as interesting locations for flexible office solutions. In fact, in many
of these cities, strong growth is already seen in the serviced and managed
office offer, reflecting demand from more traditional corporate tenants looking
for flexible leasing solutions.
Catherine Bai, Senior Research
Analyst, EMEA Research & Insight, said: “The growth of co-working is forcing
operators and landlords to rethink how they design and fit out traditional
office space to better accommodate changing tenant demand. We believe the most
successful coworking strategies will focus on European cities for their distinct
factors, and our research is a nod in this
recommended direction.”