WASHINGTON, DC–There is a currently 1.4 million square feet leased by co-working providers in the District's office inventory, according to new calculations by Savills Studley — a number that has tripled in the past five years.
At the same time there is also 2.6 million square feet of sublease space available in the District, which is 8.9% of all total available space and a 15% increase over the sublease space available in 2016.
Are the two related?
Yes they are, at least indirectly, Sarah Dreyer, Savills Studley's director of research for the DC region, tells GlobeSt.com.
“While they are not directly linked, co-working does provide a viable alternative to smaller groups looking for flexible terms,” she says. A more complete answer to the question, 'what accounts for the 15% increase in sublease space?' would have to include the long-standing trend of rightsizing, she adds.
The co-working space, however, has made rapid inroads in the District and could well be a weightier factor sooner rather than later.
Savills Studley notes that there are now approximately 20 separate providers in the District with WeWork standing out as the largest user, occupying nearly half a million square feet across eight locations. “These providers target new construction (like MakeOffices at the Wharf) and existing buildings alike (like Industrious at One Thomas Circle) and have served as a significant source of net new growth,” Savills Studley notes.
WASHINGTON, DC–There is a currently 1.4 million square feet leased by co-working providers in the District's office inventory, according to new calculations by Savills Studley — a number that has tripled in the past five years.
At the same time there is also 2.6 million square feet of sublease space available in the District, which is 8.9% of all total available space and a 15% increase over the sublease space available in 2016.
Are the two related?
Yes they are, at least indirectly, Sarah Dreyer, Savills Studley's director of research for the DC region, tells GlobeSt.com.
“While they are not directly linked, co-working does provide a viable alternative to smaller groups looking for flexible terms,” she says. A more complete answer to the question, 'what accounts for the 15% increase in sublease space?' would have to include the long-standing trend of rightsizing, she adds.
The co-working space, however, has made rapid inroads in the District and could well be a weightier factor sooner rather than later.
Savills Studley notes that there are now approximately 20 separate providers in the District with WeWork standing out as the largest user, occupying nearly half a million square feet across eight locations. “These providers target new construction (like MakeOffices at the Wharf) and existing buildings alike (like Industrious at One Thomas Circle) and have served as a significant source of net new growth,” Savills Studley notes.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
