As coworking booms in Columbus, independents ready for national players

Chloe Teasley
Haven Collective on Riverside Drive

It’s impossible to get very specific in an explanation of the phenomenon of coworking and flexible office space. Most coworking spaces have a few overlaps—an aesthetically pleasing space, a membership system, members who are using the workspace outside of a traditional office. But coworking is a traditional work alternative that is endlessly riffable and constantly evolving—so yeah, a little hard to pin down. It’s also more than a trend; it’s a disruptor to work as we know it—or a product of disruption already occurring. Long-held notions of work are changing with a swift rise in the gig economy—project-based contract work, consulting, freelancing and small jobs. A 2018 Gallup poll found 36 percent of U.S. workers are participants in some capacity.

Columbus now has about 58 coworking spaces operated by 40 companies, each trying to have its own distinct personality. You can find the most coworking spaces Downtown, in Upper Arlington and Dublin, according to CBRE research. Over the past decade in Central Ohio, square footage devoted to coworking and flexible office space has grown nearly 465 percent. Right now, nearly 126,000 square feet of coworking space is under construction. Columbus could be considered somewhat of a coworking hotbed, says Philip Pelok, senior vice president with commercial real estate brokerage CBRE.

“Certainly there are bigger markets that have much more in the way of number of offices and total square footage,” he says. “However, relative to the size of Columbus and its peers, it would certainly be ranked as a very high-interest location for coworking and flexible space providers.”

Although a couple of the options in Central Ohio hail from elsewhere in the state or the Midwest, and one has locations scattered throughout the U.S., most concepts were born and raised here—but that’s changing. Two national players have pledged to build in Columbus.

One, Spaces, is a company owned by IWG plc headquartered in Switzerland. It is worth $3.3 billion and has locations standing or pending in 45 countries, with 84 locations in 23 states in the U.S. A mere three years ago, Spaces began to develop its presence in North America, says Michael Berretta, vice president of network development for IWG. Another brand owned by IWG, Regus, already has several Columbus locations. Spaces Columbus is set for a July 1 opening at 711 N. High St. in the Short North, where it will occupy 42,000 square feet and offer six to eight jobs.

The other, WeWork, is fiercely expanding with 37 locations planned or built in the U.S. and locations in 38 countries in nine years. Although WeWork won’t disclose its future Columbus location, a company spokesperson describes the areas it likes to inhabit—business centers, innovation districts, and the areas where corporations, small businesses and entrepreneurs are. It was last valued at $47 billion, though it has yet to make a profit, according to Bloomberg.

How will our coworking scene change when they move in? Will coworking become the new norm throughout the world? We have front-row seats to see how this disruptive industry could redefine work.  

Big players move in

As Spaces and WeWork move into town, there are a variety of responses from the independent operators that dominate the market here. In general, the attitude is that their presence will float all coworking boats because it will continue the education of workers, landlords and real estate companies on what coworking even is. According to commercial real estate firm JLL, only 5 percent of U.S. office space is managed by coworking and flexible office spaces, but since 2010 the sector has grown by 23 percent each year. These spaces are projected to reach 30 percent of the office space market in the U.S. by 2030. Just like with any newer industry, consolidation will probably happen at some point as market saturation occurs.

“I think that’s several years away and we’ll see how that plays out,” says April Zimmerman Katz, owner of Versa coworking spaces. “This is a disruptive industry to the traditional office. It will be interesting to see how nimble landlords and commercial real estate is in adopting this into the ecosystems of their buildings.

“There’s a lot of space in the market. The trick is that coworking is changing very rapidly based on the needs of the market. It’s a matter of understanding your customer and your market, and staying ahead of the curve.”

Danielle Lim is the co-founder of another Grandview space with Melissa Blackburn, whom she met while getting her MBA at the Ohio State University Fisher College of Business. One Thursday evening after what Blackburn describes as a “girl boss” event, they were both feeling inspired and Lim mentioned an NPR piece she heard on coworking spaces. By Tuesday, they were looking at the building that now houses Haven Collective on Riverside Drive. Lim says the important thing is to become as specialized as possible to avoid becoming irrelevant. “There will be more of the larger players in town making it more commonplace,” she says. “Those that aren’t focused on their margins and working really smart about it will probably fade off, and those who really niche down and get their area right will prevail.” Haven Collective is focused on startups, very small businesses and freelancers. Lim says the largest member company is 10 people. She describes what she thinks will happen with coworking memberships by likening them to gym memberships. Some people want to belong to a more “cookie-cutter” gym with many locations, while other people choose neighborhood gyms with a small but strong community. Haven Collective is the latter.

Meghan and Josh Boone, the minds behind Cova Cowork in Franklinton, say they have begun to form a coalition of local coworking spaces just in case the national attention hurts business. It is still in its infancy, but Meghan says her vision is for something a lot like the Denver Coworks Alliance in Colorado. She says an idea she’d like to borrow and implement in Columbus is a citywide coworking passport that allows a potential member to explore as many coworking spaces as they want (from within the coalition), rate them and choose one.

Home away from home

Coworking spaces have two types of members—the large corporation that purchases memberships to give its employees as an alternative work area and place to hold meetings, and the entrepreneur or freelancer who has no office. Spaces and WeWork thrive because they can offer a home for members from large corporations who travel, wherever they go.

“The No. 1 differentiator for our business overall is our global network,” says Berretta of Spaces. “We’ve got over 3,000 locations globally and we’re in every major and secondary city in North America. It’s a highly network-focused business.”

Within these two distinctions, however, are endless possibilities. Some spaces include childcare, some offer programming in the form of talks or workshops. Some have a place to eat a full lunch, some only provide snacks. Some have rentable offices. All of them provide coffee.

Katz, with a background in real estate with her husband Kyle Katz, is the person behind Versa, a 37,000 square-foot space in Grandview that was one of the city’s first and largest concepts. She says she came up with the idea to do it in late 2016. She and Kyle opened another Versa in the Arena District in September 2018, and it was full in four months. She says she is not worried about national competition because of the individual uniqueness of each coworking space.

“There’s a space for everyone,” she says. “We’re educating the city on what coworking and flexible office space is and it’s something different for everybody.”

The Boones say they want to keep their spaces small to serve a specific community. Currently, Cova Cowork is up and running only in a tiny building on West Broad Street with Bottoms Up Coffee in the front and an area with desks and a few conference rooms in the back. Their new space is under construction in Kaufman Development’s Gravity, also on Broad Street. Both spaces are in Franklinton. Joshua Boone says there is nothing wrong with a big space, even though they want to keep Cova compact. “[Larger spaces] can provide things that a smaller space can’t—obviously space for the larger teams if you have a hyper-growth-model startup mentality. If you’re going to go from five to 20 employees in a year, those spaces are really good because they’ve got tons of amenities, as well as a lot of spaces to expand into very, very rapidly,” he says. “But the downfall is that the sense of community can be a little muddled, you can disappear into it, or you can have huge chunks that have your own sub-ecosystem. You also put a strain on the staff within that space, unless you can afford to have three, four, five people on staff. Your average community manager will not know the details of what every employee or every member needs and is doing because there’s so many of them.”

The Bottoms Up space is 2,300 square feet, including the cafe. The new Cova space is 7,100 square feet, which is big enough to accommodate teams of six to 15 people and will allow for some growth, but the Boones say they want all future spaces to stay below 8,000 square feet so they can be highly involved in the growth of their members. Their vision of the person they will hire to oversee the space is more like a business “concierge” than a hospitality manager.

The Boones say they intentionally stayed away from the Short North when considering which community to be in, since it seems to be inundated with coworking spaces already (Serendipity Labs, Industrious, The Perch and soon to be Spaces--and maybe WeWork. Who knows?). All of their decisions have been made from data collection and personal experience. Before moving to Columbus, the two worked remotely in coworking spaces much of the time while living in Washington, D.C. When they got the itch to start a coworking space of their own, they chose Columbus because they discovered it had a large population of younger people, a vibrant startup scene and many colleges and universities.

Hopewell Works, a coworking spot Downtown at Chestnut and Third streets, has yet a different model. Born from a collaboration between serial entrepreneur Brian Zuercher and Continental Office CEO Ira Sharfin, Hopewell accomplishes a variety of things all at once—it’s a coworking space supporting members and a lab that tests and measures the work experience people want to have. It does this by regularly rearranging the environment inside the space (with furniture from Continental Office), and surveying and studying users. Hopewell also has installed its environments in offices around Columbus, paying attention to how the installations improve the work experience for employees and then giving feedback to the company. Zuercher says one thing he has found is people want to change their work setting frequently.

“Some people just need a variety of change in their day,” he says. “Some people very much like to do certain types of work in certain environments. And if you think about a restaurant or hotel, they’re very experiential. They’re very designed for that. Work offices? Not really. We found that individuals who want to change their day are way happier.”

Every coworking space mentioned is going to expand into one, two or three places in Columbus within the next year or two. Versa is negotiating on three spaces. Haven Collective is looking right now to open at least one more space. Cova’s second space is currently under construction in Gravity. Hopewell is looking outside the city for a second setup. And time will only tell how big the coworking phenomenon gets and how profoundly it will change work.

“The industry is going to continue to grow. It’s a natural reaction to companies’ need for ultimate flexibility,” says Berretta. “They can’t be burdened by long-term contracts that don’t allow them to grow or relocate or move as their business needs. So you’ve got a traditional business model that’s been in place in the real estate industry for many, many years that is evolving. It’s evolving in favor of the customer.”

Chloe Teasley is staff writer.