Coworking areas and shared workplaces are making a comeback after a post-pandemic stoop and tensions over return-to-office mandates. As AI drives uncertainty over the way forward for their workforces, firms are transferring to coworking to get the area they want for in-person work with out the dedication.
Amazon mandated that its practically 350,000 company staff totally return to workplace in early 2025, however the chaotic rollout left staff with out sufficient desks or parking areas. In August, the corporate signed a lease with WeWork and added 259,000 sq. ft at 1440 Broadway in Manhattan to its greater than 300,000 sq. ft on the constructing. WeWork additionally operates two different Amazon workplaces with 702,000 sq. ft in Manhattan.
San Francisco–based mostly Anthropic has staff working at a shared WeWork workplace in Cambridge, Mass. JPMorgan, Lyft, and Pfizer are additionally utilizing coworking areas, the Wall Road Journal reported.
Coworking is getting into a brand new period as massive corporations and small companies alike are partnering with coworking firms to fulfill the rising want for workplace flexibility for companies and staff. These workplaces aren’t the large, antiestablishment utopian workspaces firms like WeWork had been identified for within the 2010s. As a substitute, the coworking business is targeted on personal workplace areas for firms with sleeker, extra mature designs.
The Wall Road Journal reported that coworking area within the U.S. at present totals 158.3 million sq. ft throughout practically 8,800 places, accounting for greater than 2% of workplace area, based on knowledge agency Yardi. Whereas that is decrease than pre-pandemic ranges, coworking area has grown by 51.7% in recent times from 115.6 million sq. ft in about 5,800 places three years in the past.
Publish-pandemic growth
As firms solidify their in-person work schedules, coworking workplaces are filling the hole with out the necessity to decide to long-term leases.
John Santora, CEO of WeWork, says the Nice Recession and the worldwide market selloff in 2015 prompted firms to rethink their workplace lease methods. The pandemic cemented the shift.
When Santora took over WeWork in June 2024 after 47 years at Cushman & Wakefield, the place he was COO, the corporate had simply exited Chapter 11 chapter after property administration software program agency Yardi purchased a majority stake within the firm. Since then, Santora has made WeWork worthwhile and money circulation impartial whereas investing greater than $140 million in upgrading its areas and know-how.
The shift to coworking coincides with a record-high workplace actual property emptiness charge. In 2025, 85.5 million sq. ft of workplace area got here up for renewal or emptiness, based on analytics agency Trepp. WeWork works with 40 of the Fortune 100, and its renewed success is due partially to the company want for versatile workplace area.
“Why make that long-term dedication, particularly at present, once you’re undecided of how many individuals are coming again, proper?” Santora instructed Fortune. “We’ll get you in 30, 60, 90 days, and you’ve got the power to stroll away at sure factors. So, you might do a one-year deal or a three-year take care of choices to depart. You’re not locked in for 10 years.”
Santora gave the instance of a global financial institution that was debating a standard 10-year lease rebuilding a gutted workplace area or working with WeWork.
“It was going to take them 24 to 30 months to be in that area,” Santora mentioned. “We signed the take care of them for 50,000 sq. ft within the middle of London on the finish of December. They are going to be in that area up and working in March of this yr.”
Coworking is a significant financial savings automobile for firms. They not should deal with brokerage and legal professional charges typical of lease negotiations or take care of building prices and workplace upkeep. T-Cellular reduce its actual property prices by 80% through the use of the versatile workplace area platform LiquidSpace.
In 2024, Allstate moved 1 / 4 of its 54,000 company staff to coworking areas. The corporate reduce its annual spending on company workplaces from $382 million in 2020 to $138 million that yr after closing its Chicago headquarters and abandoning two-thirds of its workplace area.
“The transition from taxi to Uber is what’s occurring from conventional workplace area to versatile workplace area proper now that every one your large gamers are beginning to use it,” mentioned Jason Anderson, president of Huge Coworking Group, which owns three versatile workplace area manufacturers.
A JLL survey discovered nearly a 3rd of firms had been utilizing flex workplaces, whereas 42% deliberate to speed up future funding. Fortune Enterprise Insights predicts the worldwide versatile workplace market will develop to $96.8 billion in 2030, up from $34.8 billion in 2023.
“The concept your constructing goes to be comprised solely of firms on 10-year leases or extra has receded a bit,” mentioned Jamie Hodari, CEO of coworking firm Industrious and a senior govt at CBRE. “I believe most landlords have come to say, ‘My constructing goes to be a palimpsest or an ecosystem of long-term leases and flex preparations and spec suites.’”
Assembly staff’ expectations
Coworking is giving firms flexibility as they handle resistance to a full return to the workplace. Whereas employers increase workplace expectations with elevated social stress and incentives to get extra staff at their desks, shared workspaces present a possibility to test-run in-office work and experiment with new markets with out totally committing.
Industrious provides high-end versatile workspaces for personal fairness corporations, regulation corporations, and Fortune 500 firms in over 85 cities globally. The corporate has seen main progress in regional workplaces of main firms, signed new agreements in 52 places in 2025, up from 33 in 2024, and plans to open 60 new coworking items in 2026.
“Numerous enterprise leaders … are extra obsessive about saying, ‘I want my staff to come back in at the least a number of days per week,’” Hodari mentioned. “Due to this fact they’re centered on saying, ‘I want nice workplaces in all 20 cities [where] I function within the U.S., not simply the highest two.’”
About 90% of staff need some sort of in-person workplace expertise, based on analysis from CIC, carried out by Harvard Enterprise Overview Analytic Providers.
“The individuals who work within the lengthy tail of cities—Austin, Miami, Denver, San Diego, who traditionally needed to work in very second-tier workplaces—are increasingly more demanding that they need to have an awesome day at work, too,” Hodari mentioned, including that many individuals need an in-office expertise on par with an organization’s headquarters.
Hodari pointed to Prospect Heights in Brooklyn—outdoors the downtown and Midtown workplace hubs—for instance. It’s the fourth highest-performing location of Industrious’s 30 New York places.
“For many individuals the distinction between a 10- or 15-minute commute and a 45-minute commute is even higher than anybody ever thought,” he mentioned. “It’s in all probability the only largest determinant of [whether] somebody … in the long term, likes their office or not, or whether or not they present up.”
For smaller firms, partnering with a coworking area is a means to supply facilities for staff, Hodari mentioned. Industrious offers reception, constructing safety, facilities facilities, and group occasions for his or her purchasers, enhancing the worker expertise.
“I believe you’ll begin to see the world be cut up into thirds on the subject of workplace area,” Anderson predicted. “[A] third will change into fully versatile, hybrid, or work out of coworking areas, which is what’s fueling the large growth for versatile workplace area.”
This story was initially featured on Fortune.com
