These Shared Offices Push The Boundaries Of Flex Offices
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A growing number of flexible office providers are giving workers an alternative to the traditional office and more established co-working models, such as WeWork. Premium and boutique flex office companies are expanding throughout the Bay Area to provide additional services and high-end office space as well as options for people who travel and work remotely.
Servcorp, a luxury flexible office company, is planning to expand further within the U.S., targeting iconic office buildings. The company offers a virtual office product where members can work remotely and use the office whenever needed. San Francisco boutique co-working provider Canopy just launched its Nomad Membership for remote workers and also plans to expand within San Francisco and Los Angeles.
More Americans are choosing to work remotely each year. About 43% of employed Americans spent some time working remotely in 2016. These workers are increasing the time they spend working remotely, with 31% working remotely four to five days each week compared to 24% in 2012.
Servcorp Chief Operating Officer Marcus Moufarrige expects the flexible office market to grow from 4% to 15% of the office market within the next 10 years.
“Landlords slowly, but surely, are recognizing flex workspace as a good option to have in their buildings and as a positive addition to their portfolios,” Moufarrige said.
Luxury Workspace Without The Long-Term Lease
Servcorp offers premium flex office space and will only occupy iconic buildings. It prefers core markets with Class-A trophy assets. It holds space on the 85th floor of One World Trade Center in New York City and the 49th floor of 555 California. Servcorp has been around for 40 years, initially started in Australia and has been in the U.S. since 2012.
Demand for flexible office has grown in recent years in metro areas. Companies are moving from campuses to central business districts throughout core markets, which has created additional opportunities for flexible office providers.
San Francisco has been a strong market for Servcorp, especially as a place of innovation, according to Moufarrige.
“San Francisco is an obvious choice if you are targeting startups and smaller businesses,” Moufarrige said. “The Bay Area is such an epicenter of innovation.”
Instead of having to pay monthly rents for Class-A office space, flex offices provide businesses with a more affordable way to have an office without being tied to a long-term lease, Servcorp Center Manager Stephanie Dittemore said.
“San Francisco is such an expensive market,” Dittemore said.
Servcorp also offers a virtual office product, co-working and executive office memberships. Its virtual office service provides businesses with a mailing address of the office tower as well as access to a receptionist who will answer and transfer calls to the business, an executive assistant and access to premium office space when needed. Virtual office members can have access to offices for 16 hours/month and three hours/day of co-working space, according to Dittemore. Membership starts at $50/month.
Each location has a variety of board rooms, conference rooms, co-working space and private offices. The offices at 555 California have a unique view of the cityscape. Servcorp has a little over 11K SF and 29 private offices at 555 California. Its location at 101 California offers 11 private offices. Servcorp keeps its spaces free of branding.
Servcorp plans to expand its U.S. footprint, including the new Class-A offices at Mission and Market under construction in San Francisco. It is in 10 markets and plans to grow within those market as well as enter new markets. It also is considering Latin America and pushing into France, Belgium and further into Europe. Servcorp already has locations in London. Servcorp has 30,000 virtual office members while another 5,000 are executive office members.
The Rise of Boutique Co-Working
The co-working industry is undergoing a similar evolution to what the hospitality industry experienced in the 1980s, according to Canopy co-founder Amir Mortazavi. During that time, the hotel industry was filled with big brand names and later evolved to include smaller operators and boutique operations. More boutique co-working operations are cropping up now with more luxury design-driven accommodations as well as more industry-specific co-working companies.
Canopy’s boutique co-working setting provides members with a close connection to the community. The firm's offices are in the Pacific Heights neighborhood at 2139 Fillmore St. About 60% of Canopy’s members live within walking distance of the office.
Having a place for people to work near their homes increases quality of life, creates a better sense of community and cuts down on commute times, Mortazavi said. Canopy’s members run the gamut and include not only tech, but also nonprofits, startups, marketing and graphic design and consumer goods companies.
Canopy is leasing another space in a historical neighborhood in San Francisco and is in negotiations for a space in Los Angeles. It also now offers a new option for mobile and remote workers. After being open for six months, Canopy realized there were a lot of people who were interested in membership, but were spending a lot of time traveling to different cities and only needed an office or conference room on occasion. Its Nomad Membership offers 60 days of access to its shared workspace for an annual fee of $3,300.
“The future of work is based on people being more flexible,” Mortazavi said.
Its first 3K SF location provides five- and eight-person conference rooms, private phone booths and co-working areas for collaboration. It offers a concierge-style list of amenities with food catered by Jane Café for conferences and baked goods delivered daily. The UPS store down the street will pick up and deliver packages. The company offers events such as private barrel whiskey tasting and other community events. Other services include 24-hour access and a private, fully stocked kitchen.
Unlike WeWork, Canopy’s design is muted and uses minimalism to create a different kind of workspace. Canopy’s space has neutral colors with lavender undertones and Herman Miller furniture.
“To really create a space that is inspiring to do your best work as well as a place that is very peaceful and not [a] distraction is a fine balance between material choices and color tones,” Mortazavi said.
CORRECTION, AUG. 22, 3:56 P.M. PT: A previous version of this story had the wrong monthly price for Servcorp membership. Servcorp membership starts at $50/month. The story has been updated.