Wednesday, March 8, 2017

Philadelphia Coworking Space Demand Surges

by Steve Lubetkin,
Philadelphia’s coworking industry had a good year in 2016 in terms of leasing activity, construction and renovation completions, A Philadelphia research team released its fourth-quarter 2016 Coworking Space MarketBeat report, which also projects continued demand for coworking office space market-wide through 2017.

“The coworking industry in Philadelphia has grown significantly since 2011. In the wake of increased demand by tenants to network and collaborate, the average footprint of occupied coworking space has expanded over the past five years from as small as 3,000 square feet to 17,000 square feet and as high as 56,000 square feet.”

As of the fourth quarter of 2016, Philadelphia was home to 19 operators offering a total of 507,914 square feet of coworking space. Companies expanding their presence in 2016 included New York-based WeWork, The Yard and Joynture, as well as the Philadelphia-based provider Benjamin’s Desk.

WeWork signed three leases totaling 113,170 square feet in the Central Business District market. The Yard expanded by opening a 24,000-square-foot branch in the East of Broad submarket of the CBD, occupying four floors of the newly-renovated William Steele and Sons building at 15 South 11th Street.

Benjamin’s Desk grew its presence in the city by 11,693 square feet in the West of Broad submarket of the CBD, and signed a 12,528-square-foot lease at 30 North 41st Street in the University City market. The company also was selected as the operator and manager of the 40,000-square-foot incubator at the University of Pennsylvania’s recently delivered Pennovation Center facility.

While many coworking companies prefer to have branch offices in the city’s Central Business District, Joynture chose to open a location just outside of the CBD. In June 2016, the company moved into a newly-renovated 23,000-square foot retail/office building at 417 South Street.

“The outlook for 2017 continues to be positive,” says Jacobs. “Three coworking companies are currently in the market for spaces ranging from 30,000 to 50,000 square feet each. In addition, Cambridge, Massachusetts-based Cambridge Innovation Center signed a 125,000-square-foot lease at 3675 Market Street in University City, which is currently under construction. Upon completion in October 2017, CIC’s facility will be the largest coworking space in the market.”

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