The Real Deal National

Co-working finally feels the crunch of supply and demand

New York still reigns as the most expensive place for a desk
July 14, 2019 12:00PM

(Credit: iStock)

(Credit: iStock)

Earlier this year, a San Francisco coder set out to create an outdoor co-working space that charged $2.25 an hour. The catch? It was comprised of a table and chair, set up on an empty parking lot.

While the cost of co-working has yet to reach the levels of WePark, as the operation was named, it has been becoming more affordable as of late, Bisnow reported.

Amid a drastic spike in supply, average desk prices fell by 5 percent in the 18 largest cities for flexible office space in 2018, according to a new report by Instant Group.

The drop in price was most pronounced in Chicago, where prices fell by 17 percent. In San Francisco and Los Angeles, prices dropped by 12 and 11 percent, respectively. In New York, where the average price of a desk circles around $1,060 per year, prices only shrunk 4 percent.

Co-working spaces have been multiplying in almost every city. New York posted the largest growth with a 21 percent spike in supply, followed by San Francisco and London. In L.A., the growth was more constrained at 10 percent.

Still, co-working companies in L.A. have been largely leading office leasing in the region. In the first quarter, WeWork alone signed leases spanning 319,000 square feet. That pushed its overall L.A. footprint to 2 million square feet. Last year, WeWork became the largest office tenant in Manhattan, and as of May of this year, it was on track to do the same in Chicago.
[Bisnow] — Natalie Hoberman