Location, location, location. You’ve probably heard this age-old quote about the massive importance of location in the real estate market, whether it’s for personal or business purposes.

But while it’s a cliche, it’s also true, especially for coworking operators. Your coworking space’s location can make or break your business, so it’s essential to find the right one early on.

In this article, we’ll help you create a framework for evaluating potential spaces for your coworking business based on five essential factors:

  • Target market
  • Neighborhood perks
  • Nearby offices and coworking spaces
  • Building and space features
  • Landlord considerations 

Let’s dive in.

Finding a Dream Location for Your Coworking Space

#1 Target Market

Like most other key business decisions, choosing the right location starts with your target market.

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For example:

  • Fast-growing tech startups looking for a long-term office may prefer communicative, crowded urban areas which all their employees can easily reach.
  • Businesses with fewer employees may decide to look for an office further away from the city center to avoid traffic and overcrowding.
  • Freelancers may want to work in a cozy, suburban space where they can focus on deep work.

This is a simple point but it’s also easy to overlook, so just take the time to consider who your target customers are and where they’d like to work.

If you’re not sure, look for other coworking spaces and office buildings where they already are. This is a good hint about the areas in which your space can thrive.

#2 Neighborhood Perks

Back in 2017, WeWork ran an extensive analysis of the restaurants, coffee shops, gyms, and other amenities in certain neighborhoods.

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Their goal was to pinpoint the right locations for their coworking spaces based on the density of amenities around them. While you don’t need to hire a whole data science team and create complex reports, it’s still essential to evaluate the area around your space. 

Here are three key questions to answer at this stage:

  • Are there restaurants and coffee shops nearby?
  • Are there gyms, yoga studios, and other sports activities within a few minutes of your space?
  • Are there grocery stores close by, so people can get their shopping done on the way back from your space?

Again, this doesn’t have to be a huge scientific undertaking on your end. A quick look at Google Maps and a few hours of walking around the area should be enough.

#3 Nearby Offices and Coworking Spaces

Businesses in the same industry tend to cluster together. This is especially true for tech startups which are the primary customers of many coworking spaces

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That’s why you should consider if your target customers are already working in the area you’re evaluating. If there are many office buildings or other coworking spaces clustered closely in the region, chances are it’s a good spot.

However, this doesn’t mean you must blindly follow the herd

Building a coworking space in an area that doesn’t have many office buildings can be a good differentiator, although it’s a riskier move. If you’re going to go that route, make sure your target customers are still within 3-5 miles, otherwise it will be very difficult to get them through the door. 

#4 Building and Space Features

Once you zero in on an area, it’s time to evaluate individual spaces — buildings, floors, groups of offices, and so on. 

If you don’t know where to start, consider getting in touch with a reputable broker or agency, as they have networks of landlords on standby.

Here are three of the most important things to evaluate when looking at each space:

  • Readiness for coworking operations. Some spaces can be made ready for operations with just a few tweaks. However, these are exceptions, so your best bet is to allocate a part of your budget for preparing the space — think new furniture, painting the walls, and so on.
  • Noise levels and insulation. Your space will likely have areas dedicated to concentration and deep work. That’s why, if the building doesn’t have good noise cancellation already, you’ll have to invest extra in soundproofing.
  • Windows, ceilings, and light. These factors drastically affect how customers perceive your space. A building with small windows and low ceilings can feel almost claustrophobic. Conversely, tall ceilings and big windows that let in natural light are much more pleasant to work in.
  • HVAC, wiring, and reception. While you can try to evaluate these factors yourself, it’s much safer to just call professionals who can assess them for you. After all, you don’t want to sign a lease, start to remodel, and have electrical or air conditioning issues pop up regularly.

#5 Landlord Considerations

After mulling over all the technicalities around the area, buildings, and budget, it’s time to consider the human element — the landlord.

You’ll want to set up a meeting with them to get a first impression by discussing questions like:

  • Are they willing to work with a management agreement instead of a traditional lease? Note: You can learn more on this topic in our article on leases vs management agreements.
  • If they’re open to a management agreement, what revenue split would they agree to?
  • What period do they want to sign a contract for?
  • Will the rent increase at the renewal date?
  • Do they allocate funds for necessary repairs or improvements to the space?
  • Will they give you a rent-free (or reduced rent) phase while you’re preparing to open the space?

One or two casual meetings can give you a good sense of what to expect. However, if you have the chance, talk to a former tenant as they can give you a first-hand assessment.

Establish and Grow Your Space with the OfficeRnD Flex Startup Program

Starting a new coworking space can be scary. There’s so much to consider, even after finding the right location, like choosing coworking software, promoting your space, creating a business plan, and more.

That’s why we created the OfficeRnD Flex Startup program – because we believe that every aspiring coworking entrepreneur should start with the right coworking software without breaking the bank. 

By taking advantage of our program, you can get a 50% annual discount on our Flex Startup plan and get access to Flex Academy — our library of detailed resources for starting, running, and growing a successful coworking space. 

Click here to apply now.

Asen Stoyanchev
Senior Content Marketing & SEO Specialist | OfficeRnD
Asen is passionate about flexible working and the future of work. He firmly believes that work flexibility directly impacts one's health and well-being. When he's not writing, Asen spends his time devouring business literature, hiking, and parenting.