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Arts Culture Co-Working Spaces: Will They Thrive Post-Pandemic?

Co-Working Spaces: Will They Thrive Post-Pandemic?

Co-Working Spaces: Will They Thrive Post-Pandemic?
A branch of KMC co-working space
By Isabel Martel Francisco
May 18, 2021
Co-working offers companies flexibility in an increasingly uncertain world. But in the midst of a global pandemic it also poses a potential health risk. We ask two experts to weigh in on the future of co-working in Southeast Asia

In late 2019, WeWork’s IPO unravelled and the future of co-working startups worldwide looked bleak. For a while, it seemed the industry was doomed to be yet another sharing economy bubble, like shared bikes before it. Then Covid hit, and everything started to change—for better and for worse. 

A global health crisis meant that people were less inclined to share office spaces. But on the other hand, economic uncertainty made the flexibility offered by co-working spaces more desireable. Not to mention, leaders in even the most traditional of companies were getting used to staff working remotely. All of which adds up to an uncertain future for co-working: will it thrive post-pandemic or revert to the pre-Covid trend? 

We asked two leaders in the space to weigh in. Carmen Booth is managing partner of Arch Offices; Mario Berta is chairman of FlySpaces. Here's how they see the future of co-working in their native Philippines and the wider region. 

See also: How To Create A More Inclusive Workplace Culture

Carmen Booth, managing partner of Arch Offices
Carmen Booth, managing partner of Arch Offices

What has happened to co-working spaces in the Philippines during the pandemic? 
Carmen Booth Co-working has taken a big hit during the pandemic. With the [Philippine] government restrictions on operating capacity, there is a push for co-working spaces and serviced office providers to find solutions to be able to operate at a 50 percent capacity, while continuing to pay full rent for its buildings. The capacity restrictions significantly reduced demand and limited rental relief from landlords has made for a very challenging environment for operators.

Mario Berta A number of small operators across the region went out of business, or have merged to be able to survive, so this crisis has led to a consolidation among operators. In the Philippines, in line with other countries in Southeast Asia, we have what we call “local champions”, meaning homegrown brands that have a very strong presence in the market. Think of KMC in the Philippines or The Great Room in Singapore, for instance—each country has at least one. These players have been impacted but have survived because of strong financial backing and a strong tenant profile. I think they will come out as winners.

Mario Berta, chairman of FlySpaces
Mario Berta, chairman of FlySpaces

What do you see as the future of co-working spaces?
CB For those that survive the crisis, I believe co-working and serviced offices will thrive post-pandemic. There is a shift towards flexible working spaces in the Philippines—both for the employees and the companies that need spaces with flexible lease terms and hybrid or remote working models.

See also: The Realities Of Finding Creativity In A Pandemic

Photo: Arch Offices
Photo: Arch Offices
Photo: Arch Offices
Photo: Arch Offices

What working model do you see companies adopting after the pandemic?
MB The very concept of office space and office work every day, nine to five, has changed forever —and it's not coming back. But it does not mean that office spaces will disappear. We are seeing a number of formats emerging, dependent on country and industry.

Hybrid: a company keeps its traditional HQ but uses a number of satellite offices.

Full on flex: lots of companies are opting for direct and fully flexible solutions, losing interest in office spaces.

By function: imagine a bank that has lots of compliance staff—they need to work [in an office] for certain safety and security protocols. They can’t just move laptops around, so these functions will stay exactly as before.

Lastly, there is Swing Space: this is a space that is used with a flexible office space operator while the client makes a decision on its future office space arrangement, or has the old office space renovated to adapt to the new normal.

How do you think people can be kept safe and offices sanitised with all the sharing of facilities involved? 
CB Temperature checks, masks, sanitising stations and operating at a lower than normal capacity are some of the ways to help prevent the spread of covid. But these are no guarantee, and we are hopeful that a government and private sector inoculation program will allow our industry to operate in a much safer way.

See also: How Is This Social Entrepreneur Turning College Admissions On Its Head?

Photo: Arch Offices

Co-working was becoming popular in the Philippines. Do you think it will make a comeback? 
MB The Philippines was following the same trend as other countries. Actually, we were only behind Singapore and Indonesia in terms of penetration—meaning total area of office space converted into something flexible—but we were the region’s third most expensive after Hong Kong and Singapore, so we’re in a very good spot.


How will co-working pivot and adapt?  
MB We see the definition of ‘community’ adapting in most of our flex offices. A huge part of co-working and the flex model relied on beautifully designed lounge areas, which were specifically designed for interaction. Now, there is a demand for physical borders or compartmentalisation as a precaution for safety and peace of mind. This may be in the form of simple markers or acrylic “cough and sneeze shields” on desks, or even the application of scheduled usage of common areas. To keep the tradition of interaction and community alive, most of the dialogue has been maintained via web-based communication tools such as Zoom and Microsoft Teams. Moving forwards, office design that now incorporates spacing as well as a newfound importance on ventilation and air quality is shaping the trend.

See also: Why Might Psychedelics Be The Next Big Thing In Health?

Will companies still need to have a physical space post-pandemic?
MB I still think that this trend of the abolishment of the office is more of a Western world luxury. For the most part in Southeast Asia, we’re in a region where tech infrastructure and accessibility is not as equally balanced, although this continues to rapidly improve. So for now, the ability of a CEO to work from home in his spacious flat in the CBD is not applicable to his entry- to mid-level employees that live an hour from the city where connection is not as stable and working conditions are not ideal. To add to this, Southeast Asia is generally very hot and humid, given its geographical location in the tropics, so having an office to go to ensures your employees do not need to consider the impact of having the air conditioning on from 9am-6pm. It may sound very mundane to us, but as a leader of a company you have to think and be aware of the wellness and satisfaction of not just your C-suite team but the majority of individuals within the organisation, because it greatly affects their productivity and focus.

Photo: Arch Offices
Photo: Arch Offices

Are some businesses more suited to co-working spaces than others?
CB All businesses can benefit from a serviced office or co-working space. It has a bit of a stigma that it’s for just startups, but established businesses can also benefit. More established business that had dedicated offices before may now shift to a flexible option, or see co-working as a great way to reduce the overhead and capital investments tied up with having a traditional office space.

MB Traditionally, certain kinds of businesses or industries have been reluctant to adopt a flexible office space, but this trend is changing fast, especially post-covid, when more businesses need flexible arrangements. Bottom line: flexible office space is here to stay—in what format, or who will be the winner of it, is still to be decided.

See more honourees from the Real Estate & Hospitality category of the Gen.T List 2020.


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