The market demand for co-working space in Toronto is relatively new, but has been growing steadily over the past 10 years, spurring an increase in supply.
Co-working space refers to a shared work environment that a group of people from different employers share. Users of co-working space are often self-employed, frequent travellers, and work in either small start-up companies or with smaller non-profit organizations. The individuals and organizations who rent co-working space also vary across numerous industries.
Most co-working spaces come complete with office furniture, phones, IT requirements, an assortment of meeting spaces, boardrooms, copy and print areas, and kitchen furnishings. Both private and open office areas are often shared by a number of people within an organization. Other attributes typically featured within co-working environments are dedicated desks, virtual offices, presentation spaces, shared common spaces and event space.
So, why has the demand for co-working spaces been on the rise?
The main benefit of co-working office space is the opportunity to share the financial costs of physical amenities such as meeting rooms, reception, kitchen areas, IT infrastructure and electronic equipment. Doing so means minimal set-up costs, which allows companies to dedicate capital to the growth of their business or organization.
Another powerful benefit of co-working space is the potential to uncover creative ideas and knowledge in a collaborative environment where occupants get to mingle with like-minded individuals and organizations.
Medium and large organizations appreciate the flexibility that these centres provide for special projects. Depending on availability, some spaces can be ready for use in as little as 24 hours’ notice. Plus, the commitment required to use co-working centres tends to start as low as six months, and may even run month-to-month beyond the initial term.
Likewise, non-profit organizations benefit from the low time commitment required to use the space, all at little-to-no upfront costs. Many non-profits like the flexibility of being able to expand or contract based on special projects to keep overhead low.
Rental rates vary depending on amenities offered, frequency of use, organization, term commitment and location.
Colliers International recently surveyed and analyzed the co-working community in the City of Toronto. The research showed that Toronto has 39 co-working office space companies with a total of 80 locations spread across the city’s submarkets.
The highest concentrations of co-working offices (30 per cent of the city’s total combined) are in the Toronto West and Downtown West office submarkets. The remaining Downtown submarkets — Downtown North, East and the Financial Core — follow with 13.8 per cent, 11.3 per cent and 10 per cent, respectively.
The increase in co-working space coincides with recent findings in Colliers Not-for-Profit Advisory Group’s Office Trends Benchmarking Survey, which demonstrated that the desire to work within a collaborative workspace is on the rise. Open spaces such as meeting areas, cafés, and kitchens promote engagement, productivity and culture, and ultimately can drive an increase in organizational capacity.
Pictured above: A map of co-working spaces in Toronto.