It was recently announced that WeWork, the global coworking chain, has signed a deal to manage an entire office building for IBM in Manhattan. Up to 800 employees will work in the building, which WeWork will manage as a single shared office environment. At first glance this looks like it is just an extension of its recent strategy of providing work spaces for employees of large firms, but it might also signal something much bigger.
Concurrent with this news was the announcement of a new Enterprise division within WeWork. While it is unclear what the specific terms of the IBM deal will be, it seems that these enterprise deals might signal the beginning of a lease-free model, wherein the value-add of the company is in the management of the space. We are seeing lots of ‘management fee’ arrangements in lieu of straight leases, and it would make sense that this is what the company is aiming for. It seems like only a matter of time before the weight of SO many leases becomes a heavy burden.
But that isn’t the main point here. Rather, what is interesting (and important) about the WeWork announcement is the shift towards enterprise. Retail coworking, which is for the most part what the world has seen thus far, is just the first iteration of a much large shift from old ways of working to ‘new ways of working.’ All of those brave pioneers who made coworking what it is today, such as Alex Hillman and Tony Bacigalupo, have opened up the floodgates for a new wave of adoption to follow the retail coworking phenomenon.
Three years ago, before we began working primarily with real estate developers seeking retail coworking solutions, we set out to do enterprise coworking. For us, the big opportunity has always been the potential to ‘convert’ large firms to the culture and flow of coworking. Not only is this a big business opportunity, it would seem, but it also potentially can serve to liberate corporate employees from uninspiring spaces and rigid workplace policies.