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The United Kingdom Co-Working Office Spaces Market is expected to grow at a CAGR of more than 8% during the forecast period (2022 -2027).
The restrictions on office-based working due to COVID-19 have made businesses rethink the space they need. COVID-19 has prompted businesses to rethink their working practices, with nearly half of UK enterprises with office space planning to shrink their estates within the next five years.
The freedom afforded by working from home, according to the research of 1,000 business leaders, is set to permanently alter the way they work. Nearly half of enterprises with office space (45 percent) plan to downsize by the end of 2025, and one in seven (18 percent) have already done so since the pandemic began. According to the study, about 18 million square feet of office space will become obsolete in the next five years, accounting for 18 percent of all currently occupied square footage, having a significant impact on the way UK cities appear and feel.
UK businesses will also be looking for shorter, flexible leases – as well as utilising co-working spaces such as WeWork, with 12 percent intending to use these locations more often instead of an ‘owned’ office. And for those businesses planning to stick to the office, 13 percent will look for accommodation which has less desk-space per head as the office’s main function is set to shift with more space for collaboration such as break-out areas and meeting rooms.
The changing consumer preferences which is again highly boosed by the recent pandemic is expected to boost the Co-Working Office Spaces Market in the United Kingdom.
Scope of the Report
Coworking spaces refer to working arrangements in which people from different teams and companies come together to work in a single shared space. Coworking space is characterized by shared facilities, services, and tools. Sharing infrastructure in this way helps to spread the cost of running an office across members. The United Kingdom Co-Working Space Market size indicates the revenue generated by co-working spaces companies in the country
The report covers a complete background analysis of the United Kingdom Co-Working Spaces Market, which includes an assessment of the sector and contribution of the sector to the economy, market overview, market size estimation for key segments, key developments, and emerging trends in the market segments, market dynamics, and key statistics. The report also covers the impact of COVID-19 on the market.
The United Kingdom Co-working Office Spaces Market is segmented By Type (Flexible Managed Office, Serviced Office), By Application (Information Technology (IT and ITES), Legal Services, BFSI (Banking, Financial Services, and Insurance), Consulting, Other Services), By End User (Personal User, Small Scale Company, Large Scale Company, Others). The report offers market size and forecasts for United Kingdom Co-working Office Spaces Market in value (USD Billion) for all the above segments.
|By End User|
|Small Scale Company|
|Large SCALE Company|
|Flexible Managed Office|
|Information Technology (IT and ITES)|
|BFSI (Banking, Financial Services, and Insurance)|
Key Market Trends
Demand of Co-working Office Space in London Driving the Market
London is currently the flex capital of the world. At the beginning of 2020, there was more than 17.1m sq ft of flexible office space in the UK capital—over 7% of its total office stock (ten years before, that figure was just 1.9%). Flexible workspace has contributed to 35% of commercial property transactions over the 12-month period (2020) in London, despite only making up 6% of the total office supply.
There are 6,075 flex space centers across the UK, having grown 7% in the first six months alone (as of 2021). In total, flex space (coworking, serviced offices, and hybrid centers that offer both private offices and shared working) amounts to more than 85 million square feet of the UK office market. The increased demand has put increasing pressure on price, with the average cost per private office desk in the first half of 2021 at GBP 431, up 10.5 percent from the same period in 2020, but still lower than the level of GBP 464 in 2019. In London, the average price per private office desk is expected to rise by 9% in 2021.
In a post-pandemic war for talent, firms demand excellent offices, with Grade A space accounting for 90% of take-up in London. The volume of new development coming through will be suited to this quest for best in class, and rents on prime space will continue to rise due to competitive tensions between enterprises.
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Pandemic Boosting Demand for Co-Working Space
Flexibility is essential in times of uncertainty. In fact, 47% of UK businesses stated they expected their real estate strategies to incorporate more flexible, serviced, or coworking spaces in the future. The attractiveness of being able to walk into a fully functional office, the flexibility to reduce and enlarge space based on headcount, budget properly with an all-inclusive fee, and stay flexible with a monthly rolling contract was magnified by global uncertainty.
In fact, Covid-19 amplified market tendencies that were already evident. Prior to the lockout, there was an increase in demand for flexible office space, and it wasn't just from startups and high-growth companies. Even larger, more established companies began to take a 'core and flex' strategy to real estate, with serviced and coworking providers handling the flex. Flexible office solutions will become increasingly appealing as businesses discover the perfect balance and blend of office space – which will take time – allowing firms to modify their requirements as their strategy evolves.
Since many tech enterprises require more than just office space, London and Manchester, as the UK's top innovation centers, are projected to witness a surge in flexible co-working spaces. Many people are looking for features and local amenities that will help foster innovation and creativity while also improving employees' working lives.
The United Kingdom Co-Working Spaces is fragmented with a lot of companies in the industry. The developers are trying to bring new and lower-cost products to meet the current demand. Evolving technological advancements such as new proptech solutions are driving the market in terms of increased transactions and better management of real estate services. Some of the major players in the United Kingdom are Work Well Offices, Labs, The Brew, Huckle Tree, Jactin House etc.
November 2021: Workspace Group PLC has announced that it has acquired The Busworks, in Islington, for a total of GBP 45 million (USD 59 million). This off-market acquisition is being funded from existing facilities. The property provides 104,000 sq. ft. of net lettable space across two conjoined warehouse buildings on 1.6 acres. It is currently operated as a multi-let business centre with customers on licences. The property is 65% let and is being acquired at a net income yield of 3.4% and a capital value of GBP 431 per sq. ft.
March 2022: Currys announces the launch of its new hybrid working models for all corporate and commercial employees in the UK. As part of its new model together with WeWork, one of the leading global flexible workspace providers, Currys will equip its 1000+ corporate workforce with WeWork All Access passes, enabling them to visit over 50 UK WeWork locations. Additionally, to support regional hubs, Currys will also be refurbishing several spaces in its own stores across the UK, giving colleagues even more flexibility about where they work.
Table of Contents
1.1 Study Assumptions
1.2 Scope of the Study
2. Research Methodology
3. Executive Summary
4. Market Insights
4.1 Market Overview
4.2 Market Dynamics
4.3 Technological Trends
4.4 Industry Value Chain Analysis
4.5 Government Regulations and Initiatives
4.6 Insights on Co-working Startups in the UK
4.7 Industry Attractiveness - Porter's Five Forces Analysis
4.8 Impact of COVID-19
5. Market Segmentation
5.1 By End User
5.1.1 Personal User
5.1.2 Small Scale Company
5.1.3 Large SCALE Company
5.2 By Geography
5.3 By Type
5.3.1 Flexible Managed Office
5.3.2 Serviced Office
5.4 By Application
5.4.1 Information Technology (IT and ITES)
5.4.2 Legal Services
5.4.3 BFSI (Banking, Financial Services, and Insurance)
5.4.5 Other Services
6. Competitive Landscape
*List Not Exhaustive
6.1 Market Concentration Overview
6.2 Company Profiles
6.2.1 Work Well Offices
6.2.3 The Brew
6.2.4 Huckle Tree
6.2.5 Jactin House
6.2.6 The Skiff
6.2.7 Icon Offices
6.2.8 Wimbletech CIC
6.2.10 Creative Works
6.2.11 The Office Group
6.2.13 Soho Works
6.2.14 The Hoxton
6.2.15 Mare Street Market
6.2.16 Southbank Centre*
7. Future Outlook Of The Market
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Frequently Asked Questions
What is the study period of this market?
The United Kingdom Co-Working Office Spaces Market market is studied from 2018 - 2027.
What is the growth rate of United Kingdom Co-Working Office Spaces Market?
The United Kingdom Co-Working Office Spaces Market is growing at a CAGR of >8% over the next 5 years.
Who are the key players in United Kingdom Co-Working Office Spaces Market?
Work Well Offices, Labs, The Brew, Huckle Tree, Jactin House are the major companies operating in United Kingdom Co-Working Office Spaces Market.