The co-working office is a big trend and rapid expanding in Thailand as well. It is perfectly fit with Startup Company which quickly expand. It also matches to millennial generation's lifestyle who need more flexible office hour, design and amenities which represent a sense of community as it is a key success of co-working office.
Nowadays, co-working office acquired approximately 100,000 sqm in Bangkok's office building alone and many more are located in retail spaces and stand alone office buildings. Co-working office is accounted for approximately 2.6% of the traditional office in Bangkok. Most of the international brands are typically looking for about 2,000-4,000 sqm in Grade A prime location building with the rapidly expanding. Surprisingly, at least 3 co-working offices in size of 4,000-8,000 sqm will enter the market within this year.
Most of the Grade A office building is located in prime location with easy access to the public transportation. It matches to basic requirement of co-working office. Recently, the majority of co-working office is located along the BTS/MRT line where their customer usually transport every day.
There are approximately 70 co-working offices with approximately 30 operators in Bangkok. In 2018, co-working office expanded 51% from the previous year and it is expected that the operators will expand their footprint at least 30,000 sqm or about 40% of the existing by the end of this year.
The current largest player in the market is Regus. On the other hand, some of the international brands – WeWork, JustCo and Spaces have entered in Bangkok's market last year and likely to make a fast move on their footprint.
Since co-working office acquires a large number of the space, it can help market to absorb a huge coming up office building space in near future.
"We have heard that one of the co-working office operator asked to lease 8,000 sqm in one building at the time. That building is located in very prime location." said by Teerawit Limthongsakul, managing director of Nexus Real Estate Advisory - the local property services consultancy.
According to Nexus' research, there are some reasons behind the popularity of co-working office such as cost saving, flexible lease team, variety of workspace, changing of lifestyle and community.
Co-working office can be a choice for tenants to save money. They can avoid the expenses incurred by renting, such as fitting-out costs, furnishing costs, management fee, utilities charges, cleaning, etc. Furthermore, the average price per person per month cost approximately THB10,000 owing to Nexus' survey.
Moreover, it can be easily adjusted in size or any changes for the customers with shorter-term contracts comparing to a traditional office. This is a plus, especially for a start-up company.
In addition, most of co-working office brands have more than one location. Members can choose wherever they want to work on daily basis which match to lifestyle of millennial generation as they are coming a major employee in the workforce. They tend to prefer flexible working style and also prefer more relaxing homely atmosphere.
It is an opportunity for landlords to partnering or leasing some of their office space to an operator or to self-developing a new concept of workplace as it can fill up any large existing vacant space, strengthens the tenant profile and increase capital value of the project.
"In the near future, we expect more developers in the region to develop their own co-working office space, either through partnerships with operators or by operating co-working office spaces themselves in their own properties. Furthermore, we anticipated that co-working office will be in every Grade A office building with the average portion of 10% of lettable area." Teerawit concluded.