modern work spaceCo-working spaces are booming, and it appears they are here to stay.

study projected that from 14,411 co-working spaces worldwide in 2017, the number of shared spaces will grow to 30,432 in 2022. This marks a forecasted annual growth rate of 61.1 percent from 2017 to 2022. Additionally, by 2022, the population of co-working members worldwide is expected to reach 5.1 million.

Property listing site Property Access Philippines credits the Philippines’ share of this boom to the “uninterrupted growth” of freelancers and start-up entrepreneurs in the country. In addition, according to the company, even large enterprises are allowing their employees to work in co-working spaces.

Co-working spaces offer a lot of advantages, especially to Millennial workers. Entrepreneurs and freelancers in co-working offices benefit from the low-cost of these spaces. Additionally, co-working offices are ideal for those who want to work in flexible and collaborative environments. Working with professionals with different skills can also pave the way for co-working members to build their own company.

But, this is the question for real estate investors: should they lease out traditional office spaces or co-working spaces? Here’s why they should seriously consider the latter.

The Small Cost is Attractive

Typically, small businesses, freelancers, and startups flock to co-working spaces to do their jobs or operate their businesses. And these professionals and small-to-medium companies are growing in the Philippines.

Small companies often have a limited budget and small teams. For this reason, instead of signing a long-term lease, they opt for co-working offices. These startups can rent a private room or a single desk. Apart from the space, co-working offices also provide internet connection, telephone lines, and office equipment. Meaning, startups don’t have to worry about office chairs and tables, among other items.

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On average, co-working spaces in the Philippines cost about P500 per person daily, inclusive of coffee and water. Members can also rent a private room for meetings at a reasonable rate.

Rising Freelancer Population in the Philippines

The explosion of the digital economy has paved the way for freelancers to thrive around the world. The same is true for the Philippines, which is considered as the social network capital of the world. The Internet is a very significant tool for freelancers. Without it, they cannot do their jobs or connect with their clients efficiently.

In 2017, the US-based service, PayPal, released its Global Freelancer Insights Report. The report surveyed freelancers from 22 countries, including the Philippines where, the study found, two percent (1.5 million) of the workforce is made up of freelancers. Among these 1.5 million freelancers, 65 percent are women. Additionally, the report showed that 86 percent of Filipino respondents believe their startup or freelance businesses would grow.

Abhinav Kumar, the head of Paypal Southeast Asia, said that “the Philippines’ freelancer market is… poised for further upsurge, with more Filipinos looking to getting freelance work from overseas.”

Further, according to the report, flexible working hours are one of the main reasons that Filipinos want to be freelancers.

There’s Not Much Competition at the Moment

Yes, the co-working industry is growing, but currently, there’s no one company at the forefront of this movement.

Co-working offices in the Philippines are relatively new, and there’s still a big space for investors. The ideal locations for this type of office set-up in the country are business districts like Makati City, Bonifacio Global City, and Metro Cebu.

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In recent years, freelance and remote workers would go to coffee shops to work. Co-working spaces, however, now offer a more conducive space to work. These non-traditional office settings present business opportunities not only to online professional but to real estate investors, as well. To begin, investors looking to break int the industry need an ideal location, a high-speed internet connection, and good-quality tables and chairs.