The global coworking spaces market size is expected decline from $9.27 billion in 2019 to $8.24 billion in 2020 at a compound annual growth rate (CAGR) of -12.9%. The decline is mainly due to economic slowdown across countries owing to the COVID-19 outbreak and the measures to contain it. The global coworking spaces market share is then expected to recover and reach $11.52 billion in 2023 at CAGR of 11.8%.
The increase in the number of people working from home or remotely, owing to COVID-19 lockdown limits the growth of the market. For instance, in March 2020 – due to many companies working from home owing to COVID-19 pandemic – operators of coworking spaces have seen an almost 50% decline in footfalls. Furthermore, according to Business 2 Community publication in April 2020, the number of people working remotely has grown by 44% in the last five years, with 7 million people (3.4% of the population) working remotely in the USA before the arrival of COVID-19. Nevertheless, the number of people working remotely is tremendously increased owing to the coronavirus outbreak over the last few months, resulting in declining revenues generated by companies in the coworking spaces market during 2020.
According to global coworking space market trends, the development of sustainable coworking spaces is a major trend shaping the coworking spaces market. Coworking spaces are implementing eco-friendly measures in the workplace to attract entrepreneurs concerned with environmental issues such as global warming. Sustainable practices adopted by coworking space providers offer substantial benefits and are economically feasible. For instance, CoCoon in Hong Kong has a floor made of natural bamboo and uses non-toxic paints and LED lights. In addition to this, drought-resistant plants are part of the interior and exterior. Another such example is Green Spaces in Denver, which uses about 160 solar panels on the roofs of its offices. These allow significant cost savings at Green Spaces. Thus, sustainable coworking space is a key trend in the coworking spaces market.
The coworking spaces market consists of coworking space rental revenues earned by entities (organizations, sole traders and partnerships) that provide coworking workspaces on rent or lease. Unlike traditional office rental, the cost of renting coworking workspaces usually covers the use of related services/equipment such as office chairs and desks Internet/Wi-Fi connection, hardware, software, and others. The industry includes businesses that offer non-residential structures with amenities and facilities on a flexible rental basis.
The coworking spaces industry market size is majorly driven by the increase in the number of start-ups globally. According to thegeniuswork.com publication in October 2019, the global startup economy was worth $3 trillion in 2019, with a rise of 20% from 2017 and 2018. Moreover, according to ENTRACKER magazine published in February 2019, the number of startups in India increased from 7,000 in 2008 to 50,000 in 2018, recording a growth of 7.14 times in a decade. The growth is backed by the expansion of internet space, exposure to the knowledge of entrepreneurship outside the boundaries of the country, and improved literacy rates. Advanced manufacturing and robotics, agriculture technology and new food, blockchain and artificial intelligence, and big data and analytics were the fastest growing startup sub-sectors globally. Therefore, the rise in the number of startups across various industries globally increased the demand for coworking spaces, thus driving the market during the forecast period.
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