Universities Tap into New Revenue Streams with Co-working Partnerships

Universities are stepping up their partnerships with co-working spaces post pandemic, according to JLL.

Work from home orders during the pandemic put an abrupt end to the co-working boom and saw the end of many flex spaces and operators; now flexible space is just as quickly making a comeback, spurred by hybrid-work policies. This is especially true in higher education, where flexible office space facilities are providing a new revenue stream after COVID-19 travel restrictions dried up lucrative international student enrolments.

“Universities are recognizing the value to the wider community of their real estate, facilities and talent,” said John Mortensen, education solutions lead in APAC for JLL’s Work Dynamics group. “Conversely, businesses bring innovation and energy to universities.”

The revenue from business users is also helpful in the aftermath of the pandemic because of the loss of lodging payments from students switching to online courses and no longer living on campus.

As an example, Purdue University has partnered with Carr Workplaces to provide businesses with flexible office space at its new Discovery Park District that gives them unprecedented access to the school.

For traditional flexspace operators, universities provide an ideal base, especially as their future strategies involve drawing more commercial tenants to their campuses, JLL noted.

In some university co-working arrangements, like at the University of Arizona, students are working out of the facilities.

“Corporates and campuses are finding common ground and this marks the start of a future for education and business that is more innovative and collaborative than ever before,” Mortensen said. “I’m excited to see what comes of it.”

Another example comes from Silverstein Properties and Cantor Fitzgerald, who announced late last year that they were partnering with University Place Assoc. to develop, operate and lease a life sciences-enabled building in Philadelphia’s University City submarket.

University Place Assoc. acquired the 43,000-square-foot development site at 4101 Market St. in 2014, as part of a strategic vision to create a cluster of energy efficient life science buildings.

The lab space includes an incubation co-working floor operated by Ben Franklin Technology Partners, and a dedicated floor for pre-built 3,000-10,000-square-foot Growth Pods with three- to five-year leases for graduate or smaller-scale companies.