The space dimension: How co-working could survive Covid

Co-working got a bad rap during the pandemic, but the sector is pushing back.

Sheree McIntyre, country head of co-working provider JustCo Australia

Co-working got a bad rap during the pandemic but the sector is pushing back, arguing that its mode of shared spaces will work well for corporates forced to offer more flexible work arrangements as employees get back to the office.

Traditionally co-working spaces have been for individual contractors or freelancers but some in the sector see potential to expand their services to design and manage the communal spaces that are likely to become more common as companies move to hybrid workforces.

With some corporates keen to reduce their real estate, landlords could consider providing co-working spaces for tenants to access when needed for meetings or creative work. Other companies will choose to outsource the management of their common space to a co-working company, especially if they have concerns about maintaining COVID-19 rules.

Sheree McIntyre, country head of co-working provider JustCo Australia, says the company will offer to take on the management of co-working spaces from landlords and other building operators who may not be confident of managing the spaces.

She tells The Deal: “Everyone has realised the need for flexibility and agility.

“There are a lot of different dynamics. Is there going to be another pandemic, a situation where people will be in a tight spot, with a long lease? (Then) there’s the desire for people to stay home and avoid the commute; the importance of sanitation and employers not wanting the worry of ensuring that their workplaces are COVID-safe.”

McIntyre believes about 35 per cent of commercial office space will be dedicated to co-working by 2030, with companies already getting rid of some of their space or converting desk areas to space for collaboration and connection. Overall, there could be a permanent shrinkage of CBD office space of between 10- 25 per cent, she says.

Even before COVID, there had been estimates that at least 20 per cent of corporate space would in future be required as flexible space, with companies gradually reducing formal desk space and building more communal areas.

During COVID, some commentators suggested co-working spaces would be relocated in the suburbs so people could use those spaces close to their homes instead of commuting to the CBD.

McIntyre disagrees. “I don’t actually believe that will happen. Unless all your team lives in a specific suburb, you will have people coming in from every angle. I think co- working spaces will have to be somewhere central,” she says.

JustCo, a multinational with headquarters in Singapore, has introduced measures to manage health issues during the pandemic. They include facial recognition technology called Sixth Sense which can monitor the numbers of people in particular areas; sanitising hot desks; and controlling the direction of traffic in buildings.

McIntyre says Just Co has strict sanitation protocols, including wiping down all door handles, microwave handles and similar, on the hour.

She says the pandemic has changed the general approach to working hours with many people keen to access co-working spaces at weekends, to avoid crowds. JustCo – which has five co-working spaces in Melbourne and Sydney – is open at weekends and off-peak times.

McIntyre says co-working is a “base and flex” proposition – areas for hot desking only and areas for collaboration, town halls and team meetings.

The company is offering tenants month-to-month leases, with no increase in rent in a period when McIntyre believes many companies are just starting to regather their teams and rebuild their cultures.