Networking opportunities, high-quality services, and a change of pace from the isolation of home office: these are just a few of the reasons that young Prague-based professionals are increasingly drawn to co-working centers in the Czech capital.
According to newly released statistics from CBRE, a real estate consultancy company, the number of leased square meters in coworking office buildings in Prague has risen by as much as 150% since 2017 (from 25,000 sqm to 65,000 sqm). The share of coworking spaces leased in new lease office spaces grew from 2% in 2017 to 10% by mid-2019.
This share continues to rise steeply. On the basis of developments in the first half of 2019, when over 13,000 sqm were directly leased for coworking, and further spaces were in the final stages of negotiations, the expectation is that the share of coworking offices, as part of the total volume of newly leased administrative space, will exceed 15% this year.
With the growing number of independent working professionals looking for inspiration outside classic offices and the market increasing at record levels, operators of coworking centers and flexible serviced offices are responding accordingly — more than 30 such centers existing in Prague alone.
Analysts say the trend is driven by millennials. “This young generation increasingly favors the individual approach, quality service, and networking found in the centers. They are growing all over the Czech Republic like mushrooms after the rain,” says Lenka Hrudíková, CBRE coworking specialist.
While freelancers, creatives, and startups often rent co-working spaces, increasingly, this type of workspace is also rented by large companies.
“Our research reveals four main reasons that motivate companies to choose coworking: coping with an increase in short-term demand (48%), cost reduction (43%), testing of an alternative workplace (39%) and as part of efforts to attract new talent (28%),” says Karel Pelán, Country Manager International Workplace Group (IWG), which operates the Regus and Spaces network of flexi offices.
He says that the popularity of flexible offices is increasing every year. “This trend was confirmed by our annual Global Workspace Survey which reveals that nowadays more than half of people are working remotely for at least 2.5 days a week.”
“85% of respondents stated that work productivity in their companies increased when they allowed employees to work flexibly,” he adds.
The last reason is becoming increasingly important with regards to the approach of the millennial generation to work and the long-term low unemployment rate. Over the past twelve months, its importance has grown by ten percentage points.
In terms of the size of spaces that operators rent and offer to their members, there are three dominant companies. Spaces have a market share of 25%, Regus 17% (both operated by IWG) and New Work 14%. They are closely followed by Scott & Weber, WeWork, HubHub Czech Republic and BusinessLink, which each hold market shares of between 8% and 12%.
In terms of the largest new contracts concluded recently, WeWork has scored some points with the lease of 5,755 m2 for coworking in the Drn Building in Prague 1. Likewise, Spaces (IWG) leased in the range of 3,300–4,000 sqm across Prague over the last three quarters (specifically in the following buildings: Parkview in Prague 4; Nile House in Prague 8; Albatros in Prague 1; and SmichOFF in Prague 5).
Coworking centers were established in the Czech Republic for the first time in 2009. They particularly thrive in larger cities, where more and more independent professionals use them.
In Prague, some of the more interesting spaces include a kid-friendly office for parents, a maker space, and a hub for artsy types in a Prague theater. In Brno, one of the largest co-working centers in Europe and the second-largest Impact Hub in the world opened in January 2018.
Many co-working spaces in the Czech Republic are also characterized by urban-chic modern design. To see a list of co-working spaces in Prague and throughout the Czech Republic see here.