By Joshua Burd
New Jersey’s supply of coworking space is still growing steadily, with an inventory that’s nearing 3 million square feet amid continued demand for virtual offices and other options.
A new report by CoworkingCafé, part of the Yardi network, found the state now has 2.77 million square feet of such space across 171 locations. That supply grew by 6 percent in the second quarter, the research found, while the average size of a New Jersey coworking space increased by 1 percent to 16,196 square feet.
New Jersey also recently surpassed the Bay Area in terms of total inventory and is now 13th nationwide, according to CoworkingCafé.
“The coworking sector has been experiencing significant growth due to several key factors:
The move to integrate a hybrid model (work-from-home … and coworking) approach suggests that, in the long run, businesses adapt to the new way that work is performed,” said Doug Ressler, business intelligence manager with Yardi Matrix. “At the same time, the increase in remote work has led many professionals to seek flexible and networking workspaces outside of traditional offices. Coworking spaces foster a sense of community and collaboration, which can lead to increased productivity and innovation.”
Notably, New Jersey had the highest monthly rental rates for what the report described as virtual offices, rising to $205 as of Q2, the report said. Rents for dedicated desks and open workspaces in the state remained at $344 and $119, respectively.
Nationally, the total square footage attributed to coworking spaces grew by 2 percent in Q2 to nearly 127.7 million square feet, CoworkingCafé found. The report noted that 18 of the top 25 markets logged increases in supply during the three-month period, with Indianapolis leading the way with a 9 percent spike to reach 1.68 million square feet.
The growth across the top 25 U.S. markets was due in part to expansion by some of the industry’s best-known names, including Regus, Industrious and HQ.
“As the workers’ relationship with the office continues to evolve, individuals and corporations have agreed that there is a need for flexibility within a company’s space footprint,” said Peter Kolaczynski, director of data and research for Commercial Edge. “As this demand further ingrains itself in the marketplace, the demand will be met by operators.”
