The real estate landscape is becoming more competitive. The days of owners being able to go after the big fish and sign the 100k square foot user as a full floor tenant every time is long gone. This blog will cover what every building owner should consider to make their building more competitive in a tight office workspace market with a focus on space in Miami.
Office Workspace Trends
Most landlords of space in Miami and other rapidly growing commercial real estate markets are not able to deal with flexibility, agility, and turnkey packaging requirements of tenants today. Tenants are shrinking in size, and many global companies don’t want to carry the burden of the lease liability in their financial statements. This is especially true if you are an owner of space in Miami. To say that the players have stepped up their game in the office workspace market in South Florida markets such as Boca Raton, Fort Lauderdale, Doral, Coral Gables, and West Palm Beach is an understatement. The amount of space that companies want to lease is decreasing, and the term they want to sign has become remarkably shorter than in years past as well.
For this reason, owners who don’t want to be in the business but want some exposure to the office workspace wave should consider becoming an incubator, organically cultivating large tenants by supporting their growth over time within a coworking space located in the building.
Benefits of the Office Workspace Incubator Model
This is one of the reasons real estate owners benefit from working with a coworking space operator like Quest Workspaces, who has programs for tenants at each level. For example, instead of having a vast empty space in the lobby, Quest suggests incorporating some buzz with a touchdown space or coffee shop. This can bring life into the lobby. From there, landlords can build a stacking plan in which tenants graduate from one floor of the building to the next level. They would start off in a coworking space, then move to private offices, then to conferencing centers, then to turnkey ready suites once they’ve outgrown the smaller private offices. Having some type of flexible alternative workspace within the building (coworking, shared office space) is important for a real estate owner to stay competitive by offering several different solutions for companies at every stage.
This from quote Laura Kozelouzek, Quest CEO and founder with a history in coworking spanning multiple decades, is taken from her editorial video about office space profitability:
If I were owning a portfolio of commercial office workspace today, the way I would be looking at it is, how do I accommodate every single and every single user at every single level.
Office Workspace Coworking Failure
The unfortunate truth is that many coworking companies won’t be in business within the next 2-3 years because their business models aren’t sustainable and they aren’t profitable. Here is what property managers and real estate asset owners should look for when selecting a coworking space that will monetize your building and office workspace profitability in the future. Especially for space in Miami and other parts of South Florida, an office workspace should have that trendy energy and vibe that has become the coworking brand of today. The critical thing to look for is the stability, history, and experience of the coworking operator. It’s important to conduct due diligence and find out if the operator has been through several different market cycles. An operator who knows how to really monetize the space and get every best dollar out of that space is essential to look for. All this must translate into a model that is profitable and sustainable.
Having seen every nook and cranny of the office workspace market in her history as a long time coworking office space provider specializing in space in Miami, Laura designed Quest Workspaces to accommodate tenants’ burgeoning demand for the freedom to work the way they want. Visit Quest today to hear about how her coworking space, virtual office, meeting room, and executive office solutions support tenants’ business growth while fostering a profitable and sustainable business model for the nine location wide Quest enterprise.
