There was a clear demand for co-working space before the coronavirus pandemic was ever on anyone's radar. For years, the growing gig economy had spurred a need for shared space. Rather than plant themselves in coffee shops for hours on end to escape the monotony of working from work, independent workers could instead rent out a desk in a co-working environment and enjoy the camaraderie of fellow remote employees -- without the bustle of continuous latte orders in the background.
Of course, co-working spaces became a less secure prospect during the pandemic. Once social distancing became a necessity, the idea of co-working spaces quickly began to wane.
But then something else happened: In the course of the pandemic, many people got tired of working from home. Of course, it's probably more accurate to say that people got tired of just plain being home, but the reality is that a lot of employees have seen their productivity -- and income -- take a serious hit since being forced to hunker down and share their workspaces with family members, roommates, and pets. It's not surprising, then, that WeWork started to see an uptick in demand toward the end of 2020.
To be clear, the co-working space provider suffered its share of losses during the pandemic, to the point where it was forced to sell off all of its noncore assets to stay afloat. But now, the co-working industry is showing signs of life, and that could lead to a nice income boost for those invested in that space.
Remote workers are growing desperate
Not only have many companies gone fully remote in the course of the pandemic, but many school districts have followed suit due to surging coronavirus cases. The result? Many people have been stuck working from home in cramped apartments with classroom lessons blaring in the background. Some remote workers are getting so desperate that they've resorted to renting hotel rooms by the day just to get their jobs done. But that can be expensive.
WeWork, on the other hand, has shifted its model to make it more affordable. In New York City, it launched a pay-as-you-go option that allows workers to reserve a desk for just $29 per day. And meeting rooms can be reserved at an astoundingly low rate of just $10 per hour.
Meanwhile, WeWork has updated its facilities to promote safety. Those who rent space will have access to hand sanitizer, and workstations are spaced out accordingly to promote proper distancing. Furthermore, mask wearing is enforced at all WeWork locations.
A need beyond the pandemic
Though many companies shifted to remote work policies because of the pandemic, there's a good chance those setups will remain in place once coronavirus is no longer such a major threat. After all, employers stand to reap massive amounts of savings by not leasing huge amounts of office building space. But that may not sit well with employees, many of whom miss the social aspect of office life and aren't keen to work from home on a permanent basis.
As such, the demand for co-working spaces could surge even more as the pandemic draws to a close and employees come to grips with remote work as their new long-term reality. Investors would be wise to think about getting in on the co-working action before that boom really takes off.