Written by Mike Kriel, CEO of Launch Workplaces
As another year begins, one thing has remained constant in the coworking industry:
Change.
The last twelve months were filled with interesting storylines, new innovations, and an evolving industry landscape.
But what does 2025 have in store for us?
Here are my predictions for the four trends we can expect to see this year.
1. Increased Adoption of Artificial Intelligence in Coworking
Artificial Intelligence has started carving out a place in the coworking industry.
And while it’s not necessarily mature yet, it has enough promise that we could see it change how things happen in 2025 and beyond.
For example, at Launch, we recently enlisted an AI salesperson to support our sales team, help with preliminary customer inquiries, and streamline our sales process.
It’s hard to say whether tools like this will become commoditized as adoption grows, but it’s important to monitor the next steps in AI technology and see how it might be able to serve us.
There are enough people developing AI products for the coworking world that operators will inevitably find opportunities to benefit from them.
2. Increased Presence in the Building
The last six months of 2024 had many landlords asking me about our ability to ‘help out’ in the non-Launch parts of the building.
There are many underutilized assets and amenities in office buildings. For example, spec suites are not furnished or equipped with Wi-Fi, conference centers are used only a couple of hours a week, and gyms are dark most of the day.
Landlords realize that the next generation of workers wants more than access to lifeless amenities. They want—they demand—a better experience. That better experience cannot always be delivered by legacy service providers that don’t want to change their methods.
The nature of a management agreement and its fundamental difference from a lease is the mission to do what is best for the building (owner) first.
The next generation of partnerships with landlords will expand the presence of their flexible operator well beyond the four walls they occupy.
3. Authenticity Over Hospitality
The coworking industry is all about hospitality, and hospitality is important. But if you ask me, authenticity is even more so.
Hospitality can be taught, but authenticity can’t. Authenticity requires you to truly care about the people who occupy your spaces.
A lot is happening in the world, and people have a lot on their minds. So, mental wellness is essential now and will continue to be for a long time to come.
We run communities for a living. Part of that needs to involve checking in on people and providing resources they may or may not use, whether they tell you or not.
People who have the ability to connect with other people on a real level make all the difference in any community.
4. Reality Checks for Coworking Optimism
As coworking professionals, we collectively operate with unbridled optimism about the future of our industry.
But I’m less optimistic for 2025 than some of my colleagues.
We’re facing two massive problems that won’t resolve themselves in 2025.
Problem #1: We haven’t hit the bottom of the commercial office market yet.
There are blips of activity, and that’s a great thing, but with a couple of trillion dollars worth of office product debt still left to mature in the next two to five years, we’re just not at the bottom yet.
This is worrisome. Many building owners have cross-collateralized assets and might even be losing some good ones because of bad ones. The world is still a very tangled web, and it will take time to sort it out.
Problem #2: Access to capital in our industry.
While some capital is dripping into the office market, it’s a fraction of what it was pre-pandemic.
The coworking industry is seen as a subset of commercial office space and is subject to the same scrutiny as (if not more than) traditional office underwriting.
Management agreements, now more mainstream than ever, are still difficult. Prime leases are not guaranteed to be accepted either. It will continue to take a lot of patience to get deals done in 2025.
With all of that being said, while I’m not abundantly optimistic, I am cautiously optimistic (with an asterisk).
I do believe the year is ripe with opportunities to secure deals when the right building, owner, and operator are in the equation.
If you’re a building owner and you’re in a financial position with your building that you can take it to the next level this year, you should do it because it will put you ahead of 95% of the similar buildings in your market.
The key is to do your due diligence.
Ask to see the underwriting when you receive proposals. Make sure you see analyses for demographics, pricing, competition, and supply and demand.
The same goes for operators. If you want to secure deals in 2025, you need to do more than throw numbers on a spreadsheet and send it out the door. Be tactful, and don’t just try to massively grow your location volume.
When you do your homework and perform proper due diligence, there are opportunities to be had this year.
If you’d like to talk more about the coworking industry, dive deeper into my predictions for the year, or explore how you might be able to benefit from having coworking in your building, contact me today. I’d be happy to speak with you.
