Coworking companies such as WeWork, Spaces by Regus and MakeOffices have redefined the office real estate landscape, and senior living companies of all sizes are benefiting from the disruption.
Smaller scale or startup companies in senior living are using coworking offices to establish a professional office environment — complete with technical infrastructure and flexible lease terms — without expensive capital expenditures.
Workbetter, a shared office provider with locations in New York and Chicago, estimates the average costs for a 250 square-foot office in a shared office in Manhattan at $4,500 per month. But that includes use of reception areas, lounges and kitchens, maintenance fees, furniture and equipment, and utilities. The costs for 1,500 square feet of traditional office space in Manhattan with those amenities would be $14,500.
Leases in coworking spaces also tend to be shorter in term, most often month-to-month.
Even well-established companies, including at least one publicly traded real estate investment trust, use coworking to provide remote workers with permanent office space, as well as meet with clients for meetings and presentations while traveling.
I can say they’ve sparked some ideas and given us other ways to approach communications and branding.LTC Properties Vice President of Marketing Mandi Hogan
It’s a trend that could gain steam as senior living companies seek to reduce overhead and co-working spaces proliferate. Last September, WeWork supplanted JPMorgan as the largest office tenant in Manhattan, with a footprint of over 5.3 million square feet. The company inked two leases in Chicago last month, bringing its total footprint there to over 930,000 square feet across 11 locations.
Flexibility in location, price
Solera Senior Living started in a WeWork location in downtown Chicago three years ago, founder and CEO Adam Kaplan told Senior Housing News. Solera has a portfolio of nine communities valued at $400 million, including four new developments in various stages of construction in Denver, suburban Washington, D.C, Philadelphia and Austin, Texas.
As Solera grew in scale, Kaplan relocated the company to a WeWork in Denver. For Kaplan and his team, leasing office space from WeWork made the most sense, as it provides flexibility for the tenant. Depending on a company’s growth strategy and staffing needs, office space can be expanded or contracted, and leases are typically on a month-by-month basis.
“You don’t need to spend a lot of time building space, so you can focus on your strategy,” Kaplan said.
Coworking is also beneficial for executives who either work remotely or travel frequently, LTC Properties Vice President of Marketing Mandi Hogan told SHN. Westlake Village, California-based LTC, a health care real estate investment trust (REIT), has 104 assisted living communities in its portfolio.
Hogan lives in Nashville and works out of a WeWork downtown, and other LTC executives across the country utilize coworking offices.
“Coworking is a function of where we are living,” she said. “We travel almost every week so it made sense to do this.”
One mid-size senior living provider is also considering moving its executive team into a WeWork, SHN learned. The provider did not want to be named, as it is currently in negotiations related to its office space.
Inspiration from other entrepreneurs
Coworking spaces have been at the forefront of the open office design, and the WeWorks of the world design open offices to save space and foster collaboration — both between team members and by chatting with other companies, Hogan told SHN.
“As a marketing person, it’s about being around other people,” she said.
The startup culture coworking attracts brings a diverse group of industries and entrepreneurs under one roof, growing their businesses. As people interact in the office throughout the workday, they can share their own experiences about building their companies and the growing pains associated with it.
This interaction with professionals outside one’s specific skillset also allows for inspiration and outside-the-box solutions to problems.
“I can say they’ve sparked some ideas and given us other ways to approach communications and branding,” Hogan said. “It’s like having a conversation in a bar.”
Coworking operators have tweaked the open office concept in recent years, adding booths to allow workers privacy for phone calls, and adding multifunctionality in the form of conference rooms.
These rooms are great for team meetings, as well as to hosts investors and clients. The common areas, meanwhile, are often teeming with activity and energy, giving visitors the chance to acclimate to the environment.
“[Coworking providers] do a good job of designing the spaces,” Kaplan said. “They’re multifunctional.”
The response from clients, so far, has been positive and another sign that coworking is no longer a passing fad. Where a shared office community once may have given a company’s investors and partners a sense that it was not established, today even Fortune 500 firms are using coworking. Larger brands such as WeWork are even offering custom workplace solutions for corporate clients.
Future design inspiration
Solera has been so impressed by its coworking experience that it is adopting open office elements to the offices in its new ground-up communities, Kaplan told SHN. It is building “heads up” and “heads down” spaces to encourage the teamwork Solera’s executive team has developed at WeWork.
Solera is also taking design elements from WeWork’s common areas and adapting them to activating Solera’s communities. This makes them more multifunctional, as well as promotes community activities and socialization.
“Every senior living community says they have an open door policy,” Kaplan said. “What better proof than to not have doors?”
Full disclosure: Aging Media Network (AMN) operates out of a WeWork location in Chicago. AMN did not receive any consideration from WeWork for this article.