by Jen A. Miller

Why Coworking Is a Hit for Telecommuters and Entrepreneurs

News Analysis
Jul 01, 20145 mins
IT LeadershipPersonal SoftwareRelationship Building

Despite Yahoo CEO Melissa Mayer’s decision to ban telecommuting last year, working in places other than a traditional office headquarters is becoming more popular. Not only has this been a benefit for workers who want more flexibility in when and where they work, including at home, it has also been a boon for coworking spaces, which support both the self-employed and more traditionally employed.

“In terms of personal productivity, it’s the ability to share and collaborate on a mobile device through applications that give you the ability you draw information from the cloud,” says Vanessa Thompson, a research manager covering enterprise social networks and collaborative technologies at IDC, of why non-traditional work setups have been and are continuing to be popular.

From 2005 to 2012, telework grew nearly 80 percent, according to Global Workplace Analytics. Coworking spaces have grown with that work. In 2005, the U.S. had one coworking space. In 2013, that number jumped to 781, according to a workplace innovation report by the National Association of Industrial Office Professionals.

Coworking spaces have seen a more recent spike, too: Memberships in these kinds of office communities rose 117 percent from 2012 and 2013, according to NAIOP.

“This changes the old line that it’s just another day at the office. America has always been the land of innovation, and we are seeing that in commercial real estate like never before,” says Thomas Bisacquino, president and CEO of NAIOP, in a statement.

The report notes that the Internet, social media and Wi-Fi have “profoundly affected workplace communications as well as workplace flexibility” – and that a younger workforce who grew up on this technology is changing the idea of what constitutes an office.

[ Feature: 10 Most Telecommuting-Friendly Tech Companies ]

Thompson adds that access to mobile enterprise application has had a profound impact, too. “Being able to get work done where you would have previously had to go to a quasi-desktop system,” she says, frees up both employers and employees to create work situations that benefit the worker and productivity.

Creatives, Techies and Politicos

Coworking spaces aren’t cubical farms. Yes, there are a few traditional offices, but overall they’re more likely to have large, centralized open spaces. That’s the case for Cowerks, a coworking space that opened in Asbury Park, N.J. in 2010.

Bret Morgan, co-founder of Cowerks, and his business partner started the space initially because their company, Bands on a Budget, had too much room in its 2008 office space. “It was a natural fit where we had some extra space,” he says. The demand for co-working space was so great that they moved their offices and expanded the coworking space as well.

Cowerks started with 700 square feet and no private offices. Today it occupies 1,600 square feet, with an open floor plan for desks, four private offices and a conference room. Wi-Fi and printing services are included.

Clients run the gamut and include writers, designers, developers and attorneys. Many are solo entrepreneurs, but Cowerks’ clientele also includes telecommuting employees. Some work remotely from corporate headquarters; some drop in a few days a week; some live at Jersey Shore for the summer. Cowerks had four day traders last year at its beach town location; this year, it’ll have six.

Price points appeal to both solo entrepreneurs and telecommuters who want a community office space. Typical rents in the region range from $800 to $900 per month and require long-term leases, but monthly memberships at Cowerks cost $250 and are signed on a month-to-month basis. Drop-in rates cost $20 per day, $85 for a five-pack and $150 for a 10-pack. The conference room is available for $25 per hour.

Nebula was the first coworking space to open in St. Louis (in 2010). “We had a lot of people who were just looking for work space,” Nebula owner Jason Deem says. “A commercial storefront was generally too big for them, and people were reaching out asking for just an office or a desk. We thought there might be a demand.”

Nebula started with a handful of members and now has more than 100. Its space has expanded to 15,000 square feet and includes eight Wi-Fi hot spots as well as more than 50 Ethernet ports. Nebula started with a lot of “creatives,” says Deem, though clientele has grown in two directions: Technology and political consultants, plus messaging firms.

[ Analysis: Coworking Offers Employees More Than Office Space ]

“I think we’re getting some political people because they want to be connected to the small business and tech community,” he says. “They want to be in touch with what’s going on, and the coworking space provides that.”

Nebula prices run from $50 to $175 per month, depending on what services a person or company wants. More expensive memberships include things such as 24/7 building access, kitchenette use and lockable storage.

The traditionally employed still make up a small percentage of members of co-working spaces – just 9 percent, according to the NAIOP report, compared to 53 percent freelancers and 14 percent entrepreneurs. But NAIOP predicts that the co-working movement is just getting started and will take traditionally and non-traditionally employed in a new kind of workplace direction.