Getting College Students Into Coworking Spaces

By KIMBERLEY HAAS

As the future of traditional office spaces remains unclear, the coworking industry is seeing growth, and college students could boost this market while benefiting from the opportunity to work alongside established professionals and entrepreneurs.

According to a CoworkingCafe market study released last week, 80% of the top 100 universities in the country have at least one coworking space close to campus. Analysts found a total of 926 coworking spaces within two miles of the schools they looked at.

New York University has 220 coworking spaces around its campus, George Washington University in Washington, DC, has 74, and the University of Illinois at Chicago rounds out the top three with 66 coworking spaces within two miles.

The median price for an open workspace is $124, according to the study, and students who take advantage of them have access to opportunities they might not get otherwise.

“For many students, college is a time to get out on their own and begin taking their lives into their own hands. It’s the first step in building a career and can make getting a job easier, even if it’s still daunting. But students these days have the advantage of coworking spaces, which can be game changers by offering real-life office experience in a professional environment, something that is not easily, if not downright impossible to convey in a college library or dorm room. Furthermore, students can start building their network by working alongside established professionals and entrepreneurs, and who knows, may even find a job, partners, or clients for their own business,” Laura Pop-Badiu wrote for the study’s introduction.

How big is the coworking market?

According to a CoworkingCafe industry report for Q2, the national coworking space stock was at 6,163 locations in June, reflecting a 10% increase in the span of a quarter. The three markets with the highest numbers of coworking spaces included Manhattan, Los Angeles, and Washington, D.C.

Although coworking spaces only account for 1.74% of the total office space nationwide, they are being considered as a viable option for landlords who have lost traditional office tenants.

Doug Ressler, business intelligence manager at Yardi Matrix, said in a statement that the commercial real estate industry is experiencing office vacancy rates that have surpassed the highs of the 2008 global financial crisis, reaching a record 17.45% as of Q2 2023.

With remote and hybrid work, demand for traditional office spaces will not likely return to pre-pandemic levels and the industry has started to innovate to respond to current challenges, he said.

“The commercial real estate sector is gradually adapting to a hybrid model of work for many economic reasons and coworking is an integral part of this adaption,” Ressler said.

Ressler said with falling property values in some cities and rising interest rates, the commercial real estate industry is at a crossroads. Loan extensions for commercial properties are being made possible through coworking and shared spaces because they are proven opportunities to restore occupancy and increase cash flow, he said.

It is expected the office sector could take a few years to balance itself out as companies reassess their needs for employees and building owners decide what they want to do with their spaces.