CREJ - page 32

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/ BUILDING DIALOGUE / SEPTEMBER 2015
T
op-tier U.S. cities, like San Francisco and Chi-
cago, have boasted co-working office space
since before the first-generation iPhone
was released in 2007, whereas co-working office
space is a relatively new phenomenon in Denver
(began in 2010).
What lessons can Denver learn about co-work-
ing office space from markets that are five years
more established and 10 times its size? For starters,
the demographic profile of co-working clientele or
“members” is important to understand. Co-working
attracts entrepreneurs, who believe that the old mod-
els of making a living are not as reliable as they used
to be. Mainstream entrepreneurship sprang from Pres.
Obama’s Startup America Initiative in 2011, during the
Great Recession. Today, the average age of the larger
tech industry is 39.8 years old. Entrepreneurs are re-
cruiting millennial hustlers, hackers and hipsters
through co-working office space, but that’s only a
fraction of the appeal. Although there is an age and
income differential between “members,” practically
everyone has an MBA (24 percent of most recent Har-
vard MBA grads are employed in consulting; another
18 percent are employed in tech). Other co-working
perks include: bicoastal offices, charging your Mac
with wind energy, 3-D printing, summer camp with
venture capitalists, health insurance and a social com-
munity for startups.
There is approximately 500,000 square feet of
co-working office space delivered or coming on line by
early 2016 in the Denver metro area. That’s 1.5 percent of
downtown Denver’s office inventory. Traditional office
metrics support 150 to 250 square feet per employee;
however, co-working office space is designed to ac-
commodate 48 square feet per employee. At full capac-
ity, Denver’s current supply of co-working office space
will house 10,000 “members.” Comparatively, Lockheed
Martin Corp., Colorado’s fourth-largest private employ-
er, has 7,100 employees in the state. Where are these
co-working “members” coming from? In 2013, Colorado
had over 837,000 entrepreneurs, earning nearly $25.7
billion in income. In the past, these entrepreneurs
would have operated out of their own kitchens or ga-
rages, or hopped to different coffee shops and libraries
to get work done. Now, they can rent a desk from Cre-
ative Density, Converge, Galvanize, Green Labs, Green
Spaces, Industry, Modworks, Shift, Uncubed orWeWork
(to name a few in alphabetical order) for approximate-
ly $500 per month. Whether “members” find them-
selves in San Francisco, Chicago or Denver, the rates for
co-working office space (not including any a la carte
services) are flat across the board, which explains why
operators are clamoring to break into Denver, where
direct lease rates are half as much as San Francisco.
Whitney Hake
Associate
Vice
President,
DTZ
TRENDS
in Co-working
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