SHANGHAI, CHINA - Media OutReach - May 4, 2017 - The Asia Pacific region is poised to see a rise in flexible working environments as the demand for co-working space grows at an average of 10-15% per annum across all regions, according to a report by Cushman & Wakefield and CoreNet Global.
The report shows that Asia Pacific's total co-working stock of 10 million square feet (msf) is estimated to be a quarter of that available in the United States and half of that in Europe (40msf and 20msf respectively). Despite the smaller stock volume, corporate real estate (CRE) managers in Asia Pacific are the most likely (70%) to utilize co-working spaces, with the ability to pursue opportunistic growth over the next 12 months listed as the most important motivation for doing so (63%). More than half of the respondents also expected cost savings in prime locations, where co-working spaces are traditionally 10-30% cheaper than traditional office space.
In 2016, co-working operators leased around 5 msf of co-working space in Asia Pacific -- a region that remains a top destination for growth outside North America for multi-national companies (MNCs) wanting to build or maintain a presence in gateway cities/regional financial centers.
Chris Browne, Head of Global Occupier Services, Asia Pacific at Cushman & Wakefield said the speed and flexibility offered by co-working spaces allowed businesses to accommodate a more uncertain operating environment and to withstand periods of dynamic change.
"Traditionally businesses were constrained by the time and cost of acquiring and fitting out new premises. The shorter leases and competitive costs of these spaces provide options for businesses wishing to scale up either at speed, on a project basis or for a temporary period."
Among the sectors surveyed, the Technology, Media/Entertainment and Professional Services sectors were the most willing to adopt co-working practices, while the Banking, Financial Services and Insurance (BFSI) sector was the most sensitive to rising real estate costs. Nearly half of the BFSI respondents preferred short term leases (one to three years) because of the uncertain operating environment -- a concern also highlighted by the Technology sector.
More than half of the CRE managers surveyed said they had already begun forming solutions to tackle rising rents and more than half indicated they were interested in incorporating co-working solutions into their overall CRE strategy. Most indicated they will consider adopting flexible workplace strategies to utilize existing space more efficiently; they are also willing to invest in technologies to enable flexible working environments, validating the fact that companies are increasingly supportive of the idea of collaboration, teamwork, agility, networking and openness in the workplace.
Jonathan Wei, Managing Director, Head of Occupier Services, China at Cushman & Wakefield said: "Enthusiastic about its prospects, the demand for shared offices is growing and entrepreneurs have shown openness to Co-working space. The environment, amenities, cost savings, and flexibility that Co-working space offers make it a great case for all kinds of occupiers including small businesses, start-ups, and larger companies. However, their viability in the longer term is yet to be tested."
The Co-working: Understanding the Ongoing Evolution report is based on a survey by Cushman & Wakefield and CoreNet Global and considers the responses of end-users and service providers, primarily from the Professional Services, Technology, and Banking, Financial Services and Insurance (BFSI) Industries.
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop and live. The firm's 43,000 employees in more than 60 countries provide deep local and global insights that create significant value for occupiers and investors around the world. Across Greater China, there are 20 offices servicing the local market. Cushman & Wakefield is among the largest commercial real estate services firms with revenues of US$5 billion across core services of agency leasing, asset services, capital markets, facility services, global occupier services, investment & asset management, project management, tenant representation and valuation & advisory. To learn more, please visit www.cushmanwakefield.cn or follow us on LinkedIn ( https://www.linkedin.com/company/cushman-&-wakefield-greater-china