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Coworking Sees Steady Growth as Hybrid Work Reshapes Office Trends

The coworking market is poised for sustained growth and innovation as hybrid and remote work continue to shape the new office landscape.

Inventory reached 7,695 spaces at the end of 2024, up 2% from the third quarter when there were 7,538 coworking spaces, according to a national coworking report from CoworkingCafe. While the quarter-over-quarter growth was modest, it signals continuing upward momentum in the sector, said the report, which analyzes sector trends in the 25 largest US markets.

The two leading markets by number of coworking spaces remained the same from Q3 to Q4. Los Angeles had 292 spaces and Dallas-Fort Worth added seven spaces to its total inventory to reach 286 spaces. Washington, D.C., came in third with 277 coworking spaces, an increase of 11. Chicago came in fourth adding eight spaces to reach 263, and Manhattan dropped to fifth place after losing two spaces to settle at 273 coworking spaces.

Overall, 20 of the top 25 markets registered increases in coworking inventory during the quarter, the report said.

Salt Lake City had the highest growth during the quarter. The city added six coworking spaces, bringing its total to 81 and representing 8% growth. Austin also showed notable growth, expanding to 92 spaces, a 5% increase in inventory.

A few markets experienced declines in their coworking inventory, mostly in the 1% to 2% range. Manhattan, Orange County and Minneapolis were among these markets, the report said. Coworking growth was flat in Los Angeles and Brooklyn.

The national median monthly price for open workspaces dropped slightly to $149 from $150 during the fourth quarter. Some markets, however, experienced sharper movements. In Manhattan, prices fell substantially from $299 to $240, the report found. In Dallas-Fort Worth, prices rose from $150 to $199.

Meanwhile, the national median price for dedicated desks was $300 per month at the end of the fourth quarter. Denver and Nashville saw the largest increases in dedicated desk pricing, both growing $19 to $319 and $324 respectively.

San Francisco remained one of the most expensive markets for dedicated desks at $415 per month, but it also experienced the largest price drop of $35 during the quarter. Markets more expensive than San Francisco include Manhattan, San Diego, Brooklyn and Austin.

Virtual office pricing was steady at a median of $120 across the country, which was unchanged from the third quarter. Washington, D.C., had the lowest virtual office prices at a median of $79. Other markets below the $100 mark in this category were Dallas-Fort Worth, Miami and Indianapolis, according to the report.

Nationally, coworking space allocations rose by 3% during Q4, reaching a total of 136.9 million square feet — an increase of more than three million square feet from the previous quarter. The top coworking operators during the quarter were Regus, Industrious, WeWork, Spaces and HQ.

Reprinted with permission from the Wednesday, 29 January 2025 06:56:38 EST online edition of GlobeSt © 2025 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or reprints@alm.com.